Real Estate Prices Fluctuate with the Seasons - Prices Drop in the Fall.
It has long been known that demand for real estate decreases after what is traditionally called the summer selling season. Spring and summertime are when buying activity is at its strongest of the year.
While markets vary and past performance does not guarantee future results, sales generally slow down in the fall, as students are settling into school and families begin to focus on the holidays rather than on moving. This historically has had a negative impact on real estate prices, and prices have seemed to decrease.
Opportunity Knocks For Buyers.
The fall and winter present a window of opportunity for buyers interested in buying a home or an investment property.During the fall and winter months, there is far less competition from other buyers, which results in sellers sometimes being forced to accept offers lower than they would like, if they want to sell their homes within a reasonable amount of time.
Real Estate Prices are Trending Upward.
As the chart above shows, the long-term trend, for real estate prices, appears to be an upward trend. The real estate market continues to rebound as unemployment numbers go down and our economy continues to stabilize and improve.Where are we Today?
Most noteworthy in the chart above, is the clear pattern showing a seasonal fluctuation with prices falling in the fall and into the winter. In the springtime and summer, prices steadily increase until the fall season, then prices again fall and this pattern repeats itself.This cyclical pattern has been repeated each year since 2009 when the market began to stabilize and rebound, as the chart seems to indicate.
In short, if you are considering buying real estate, it should be done during the fall months and into the winter, while prices and interest rates are typically discounted.
Further, if you are considering selling your home or investment property, it should be done after the first of the year until prices peak in the summer selling season in order to get top dollar.
Mortgage Interest Rates seem to be Trending Upward - But Rates also Fall in the Fall.
Mortgage Interest Rates generally follow the same seasonal pattern according to the laws of supply and demand.
With real estate sales down and demand for mortgage loans down, mortgage interest rates also typically fall in the fall and winter. This has proven to be the case this year, according to the chart above. Interest rates rose from mid-May and peaked in early-September, when they fell to 4.1% near the end of October.
With prices and interest rates down in the fall and winter, it would seem wise to take advantage of the window of opportunity, rather than wait until the spring when many others will be out competing for the same properties, driving up prices and accepting higher mortgage interest rates for their purchases.
Related article:
Calculated Risk: House Prices: CoreLogic to turn negative month-to-month seasonally in October
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Since 1998, Mark has been providing expert representation to buyers and sellers of homes, condos, multi-unit properties and multi-million dollar estates.
His clients include friends - old and new - colleagues, professional football and basketball players, original founders of Fortune 500 companies and other high-profile personalities, who value their privacy and anonymity. Mark has also consulted Nationally and Internationally with many interested in buying and selling real estate.
Mark can be reached at 619-246-2860.
Email: markonthemark@gmail.com
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