'Foot Traffic To Decline In The Winter Months'...Sell Now or Wait Until Spring?
Posted by Bob Barnum on Friday, October 23, 2015 at 9:26 AM
By Bob Barnum / October 23, 2015
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'Tis The Season, Jingle Bells, Jingle Bells, Jingle All The Way...
It happens every year, as the leaves turn and foliage starts to whither we begin our annual pattern of what I refer to as "Holiday Thinking". It seems retailers put out Christmas decorations almost at the same time they roll out Fall and Halloween items. So how does this impact our local Real Estate market?
Well, many of us unconsciously go into holiday mode once Halloween arrives we literally have a holiday every thirty days for the next three months. Kids have events, we decorate and attend endless gatherings and parties providing a welcome "distraction" from the hustle and bustle. We are also overwhelmed with advertising to Buy Buy Buy!
Many Real Estate professionals and their clients buy into a belief that prices go down in the winter with foot traffic of buyers touring homes. It's true as shown in this graph that historically traffic does follow the temperatures and taper off in the winter months. Landscaping goes dormant affecting curb appeal and the communities kind of just go gray.
Zig When Others Zag...
True professionals, like The PerfectHouse Team, and educated sellers profit from their competition laying down for a season, every year, it seems it's the same pattern. It PAYS to be counter intuitive considering more than the just season, or appearances. Every situation is different, sellers that need to sell should consider doing the opposite of what everyone else says. Especially "Move Up Sellers", those that need to sell a home to upgrade or downsize into another home.
Possibly the WORST ADVICE in the Press Today...
"Wait till the Spring Market to sell your home..." Taken at face value and only considering seasonal statistics this looks solid on the surface. Just like your unique property and circumstance, this may be a decision that could cost untold thousands of dollars and even cancel a move all together. "Timing is everything", you have heard this cliché a million times. Sadly most Americans miss timing because at heart most are "followers". We follow the momentum blindly causing the very seasonal trends we are talking about. We are in the middle of a few historic economic events that may warrant a closer look regardless of the temperature or conventional wisdom.
Why Sell Now vs Why Not?
A. Myth: "Fewer buyers mean less foot traffic and lower demand that leads to lower prices during winter months".
1. Consider this, it's true there are fewer Active Buyers during the holidays BUT the ones that are shopping in many cases MUST MOVE NOW. They are SERIOUS BUYERS. Who wants to shop homes during the winter?
2. It is also true that there are fewer homes for sale as sellers and agent sit out the winter on the sidelines waiting for spring. Therefore the supply and demand dynamic is not as skewed as you would think. Homes for sale in the winter have less competition.
B. Myth: Homes for sale in winter get fewer and possibly lower offers due to dead grass and landscaping, they do not show as well.
1. A well-staged home in top condition, lit and decorated for the seasons can have a warmer and inviting charm then in other seasons. Yes, it is a little more work and yes, decorations and lights should be moderately subdued for maximum effect. Women buy homes, they need to "Feel Something" viewing online photos and in person tours.
2. Consider the economic timing. We know why we want a larger audience but why do you want more competition? For the past 7 years mortgage interest rates have been artificially low as a result of over $80 Billion dollars a month printed to fund and back residential mortgages. We all know this is not sustainable or good for any of us in the long run.
The selling price is important but it is the "cost" of the finance money that really drives the market. Buyers live with a monthly payment not the Sales Price. Currently a buyer qualified to buy your home at 4.25% will lose approximately $9,500 in buying power for every 1% increase in the interest rate. Interest Rates change Daily, a market move of only 2% could put as much as $19,000 downward pressure on a home's value from October to March. Starting the see the potential cost of "waiting" and following the crowd?
Bottom Line...
Only you know what's best for your family when considering a move but you should take action now.
Selling or Buying a home is HUGE in the scheme of your financial plan. We recommend you interview and seek advice from a Full Time Professional with a track record and the experience to help you consider every option. Find a Realtor more interested in a relationship than a sale and sue their advise and experience to make your own decision. It really comes down to this, Do you Need to move or not? Failing to act may wreck a move but acting without all the facts can be too risky. Sadly many folks never compare Realtors, they answer an internet ad and go with the 1st agent up to 90% of the time, never knowing they were SOLD instead of getting guidance from a Realtor that values the relationship more than a sale.
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