Listing in the Winter = Selling for more!
Stay ahead of an important MLS change!
Last winter Anthony Lamacchia wrote a Column in the Boston Globe along with a noteworthy blog illustrating how Home Sellers who List in the Winter Get a Higher Price. The blog debunks the common misconception that spring is the best time of year for home sellers to sell. The fact is there are tremendous home selling opportunities throughout the year, in particular in the winter homes typically sell the fastest and for the most money.
Why this is the case? The most significant contributor to this outcome is that the available inventory levels in the winter are typically at their lowest for the year, especially in January. With scarcity in the market, when a home gets listed there is a natural increase in demand as there is very little, if any, competition. The forces of supply and demand come into play as the driving force behind homes going under agreement quickly and often over the asking price as a result of a Bidding War.
Another key factor that will rapidly impact housing inventory is a long awaited and welcomed change to MLS Guidelines. For at least the last five years when a property that was listed for sale comes off the market for any reason the property would have to stay off the market for at least 90 days before it could return with a clear market history. The recent MLS change reduces the number of days the property needs to remain off the market to only 60 days. This will have a considerable impact allowing sellers to relist their homes with a fresh start date 30 days sooner than before.
In prior years the number of homes for sale typically began to rise in mid to late February. The 90 day wait period is closely correlated with sellers who took their home off for the holiday season in the November timeframe and relisted 90 days later in February. This year the influx of homes getting relisted will also be faster. The selection of homes competing in the market sooner will result in an increase in supply which will reduce the demand per property.
This chart illustrates total homes for sale (Inventory) over 52 weeks in 2013, 2014 compared to 2015:
Another important consideration is the past three January’s have been very consistent with somewhere between 17,000 and 18,000 homes for sale. As mentioned January almost always marks the lowest inventory of home for sale of the year with the exception of 2015 when the lowest point of inventory was right after all the snow was done falling in early March. This past week actually showed the lowest January inventory since January 2003. There were about 17,249 homes for sale compared to almost exactly the same amount of homes in January 2003. This low inventory is wonderful for sellers but can be very frustrating for buyers because of the aforementioned creation of Bidding Wars which drives prices up.
Here is a chart that shows early January Inventory every year going back to 2003:
When to list this year?
With this change in MLS guidelines listing as soon as possible in order to get a head start on most other sellers will get your home sold quickly and at the highest price!
Even if we did get another year of record breaking snow fall you are still better off going on the market sooner rather than later. Last winter many of the homes that listed in January went under agreement before the snow really started. The ones that missed that window either sold in February during the snowiest month in the history of Massachusetts or sold right after. In the two weeks after Snowmaggedon just about every house for sale sold. It was best time to sell in over ten years because there were so few homes for sale.
It’s true that in the spring thousands of homes sell and home prices peak. But what most people are not factoring in is that many of the properties went under agreement in the winter. Remember most real estate transactions take an average of 8 weeks to close. In the spring many deals get delayed even longer as some sellers want to wait until after the school year ends.
So if you’re thinking about waiting until spring to sell your home, you should reconsider and put your home on the market in the winter when there’s less competition. The key to this actually has nothing to do with winter itself. It is just the importance of listing before everyone else does. No doubt it will equal more money!
For additional information with more charts and data click here to read our blog from last year called List your home in the Winter to Get a Higher Price. And below is a Washington Post article from two years ago explaining the same concept.