When is the Best Time to Buy a Home or Sell a Home?   Tweet

Do you want to buy or sell a home for less money?

Homes in the winter are listed for less money. That is what the Listing Prices chart shows with the median list and sale prices. The median price is found by putting all homes in order from highest price to lowest price and identifying the one in the middle, the median.

Because we are looking at a very large number of homes in this chart, all homes in the Columbus Multiple Listing Service, and there is no distinguishing factor between homes, the chart reflects overall prices as well as the median. As you can see, the chart shows that Listing Prices are lower in the winter with D-14 (December 2014), J-15 (January 2015), and F-15 (February 2015). The highest Listing Prices being in May, June, and July which is the start of the new price season in central Ohio.

The Listing Prices chart also starts at the left lower than it finishes at the right. As time passes real estate values typically increase. In central Ohio we typically do not have big up and down price swings seen in other areas in the country. This chart is typical of central Ohio Listing Prices from year to year where we see about 5% price increases.

How important is length of time to sell a home?

It costs more money when your home is on the market longer. Homes which are on the market longer end up selling for less money. Buyers think there must be something wrong that no one has wanted to buy this home for so long, therefore they will make a very reduced offer. This is why when you are selling your home that pricing it right to begin with is so important. This means knowing the market and the likely amount you will be able to bring in a buyer who will make a good offer.

The Days on Market chart (Often thought of as Number of Days to Sell) shows that February and March have the highest CDOM (Continuous Days On Market). The days on market is determined after a home is sold. If February and March is when the home sold, then it is likely that the home was put in contract about 45 days or a month and a half prior, which would be December and January. The Buyers were looking and making their offer in the winter months.

How close to the asking price should you expect?

We are often asked for our opinion on how much to offer for home. Offer too little and the sellers may get offended. An offended seller is not the best to work with when buying as they do not want to give the buyer much in the way of reduced price or help them with other things which can come up during inspections. It is better to have the seller happy to sell their home and wanting to do what they can to help the buyer.

The Sold to List Ratio chart shows that in January the average seller gets about 92% of their asking price. Compare this with the high in June of about 96% If you are moving into a more expensive home, then doing this in the winter months is good for you. You may get less money for the home you currently own, but you are also paying less for the more expensive home. The Sold to List Ratio chart shows this to be about a 4% difference. If you are selling a $300,000 home, 4% is $12,000. If you are buying a $400,000 home, 4% is $16,000. That would put you ahead $4,000 just by selling and buying in the winter.

There are some benefits to selling in the winter:

• Less competition from other sellers
• Buyers are more determined to purchase

Do you benefit as a buyer or seller when there are fewer homes on the market?

People generally do not like looking for homes in the winter. This often requires being out in ice and snow and cold driving around. Then there is the getting out and walking through the cold and snow to look over the exterior of the home. For many of the same reasons, sellers prefer not having their home on the market in the winter. These things combined with the lower prices and lower List to Sale Ratio and people do not feel like selling during the winter.

As the Number of Listings chart shows there are fewer homes for sale during the February, March, and April months, about 8,000. Compare this with August when there are over 9,000 homes actively listed for sale. Who is selling in the winter? Sellers are often those who have to sell for one reason or another, such as relocating for job. Buyers are often those who are seriously looking (not just browsing around) and they are looking to get a deal before spring, when prices and demand tends to increase.