When’s the best time to sell your house?
Common knowledge is that spring and summer are the best seasons to sell your house. March through July tend to be the busiest months overall. Most families don’t want to move when the kids are in school—and no one wants to move during winter.
But… is that always true?
Let’s look at the best (and worst) month for a home sale.
The Best Time to Sell a House—Historically
Let’s ignore the housing boom and recent mortgage rate woes.
On average, houses sell faster and for more in the first two weeks of May. In recent years, this has shifted somewhat. Selling a house in March is faster, but you’ll get more money if you wait until July.
Largely practical concerns. Real estate is an industry of big numbers. Whatever “most people are doing” is going to lead the market. The average buyer doesn’t want to buy during winter.
In the first two weeks of May, people are coming out of hosting their holiday parties. They are thinking more about what they want in a home. They’ve recovered from huge late-year expenditures like Christmas. And their kids are out of school.
It’s the perfect time to start hunting for houses.
But think about this year. Houses were selling like hotcakes, then the new mortgage interest rates hit, and the market slowed down. That doesn’t mean that now isn’t a great time to sell a house—but there are external factors beyond seasonality.
Let’s take an actual look at the numbers pulled from Ycharts.
And here’s 2019:
We can see that July is a great time of year, especially back in 2019. But we can also see that 2020 didn’t hold to that pattern—the numbers kept increasing.
Without any other confounding factors, we can say that summer is usually the best time of year to sell.
- People are fresh out of the holidays and want a space to entertain.
- People are ready to move after the winter holidays and spring cleaning.
- People with children can move because kids are on summer break.
But in a hot, accelerated market, you may see the market doing other things, such as continuing upward trends.
Okay, What’s the Worst Time to Sell a House?
2008 through 2009.
The worst time to sell a house seasonally is in the winter. January will yield the slowest sales and the lowest prices. No one wants to look at homes during the winter. No one wants to move during a holiday.
But even that isn’t necessarily true. The charts show that if you sold a house in November of 2020, you would have made less than selling in January 2021. The housing market was on an extraordinary hot streak.
In general, selling a house during the winter will yield the worst results. But this isn’t always true because, at minimum, you face less competition. If someone needs to buy a house in winter, they may find few options.
What Exactly Do “Best” and “Worst” Mean?
Note that when we talk about “best” and “worst,” we frequently discuss different things. There’s the speed of the house sale and also the price.
Let’s say you want to sell your house fast. Boom. Spring and summer. People are in the market, especially if your house is in a great school district. But let’s say you want to sell your house for the most money.
Even though sales tend to be depressed in the winter, it’s possible you could sell for more just because there’s less housing stock available. Presently, prices aren’t going down in the winter, even though fewer properties are sold.
It’s a balancing act. And it’s an extraordinarily difficult balancing act because of how quickly the market moves. But what is sure is that it’s not that hard to find a potential buyer right now.
What Impacts the Speed and Volume of House Sales?
Why are houses selling so fast?
America is experiencing a tremendous housing shortage. Part of the acceleration isn’t that people are just “buying houses faster.” It’s that fewer houses are on the market to purchase.
Of course, this also pushes prices upward rapidly—fewer houses on the market means more people are competing for the same house. People get aggressive during house hunting, waiving contingencies and offering over asking. Consequently, home prices keep going up.
There are a few reasons behind this housing shortage:
- The millennials are hitting their 30s and 40s, which is when people traditionally buy homes. They’re also having children later in their lives.
- Investors are starting to invest in real estate because of the coming recession. Real estate is a safer bet.
- Investors also buy starter homes, making it harder for first-time homebuyers to enter the market.
- New construction has been depressed for some time, partly because of supply chain difficulties and because they became very cautious after 2008.
So, we have a housing market that’s been slow to spin up. We haven’t made as many houses as we need to fill the need. And that has removed much of the seasonality from the market because houses are just going up and up.
For decades, the housing market worked on a cycle. The market went down in winter and up in spring. Primarily, that was because of school. Parents want to purchase houses during summer so their children don’t have to move during the school year.
But the past ways of doing things have been largely obliterated.
When Will the Housing Market Return to Normal?
It’s impossible to say.
The market has changed so much in the past year that any attempt to predict the future would be foolish. We don’t know what’s going to happen.
We can say that many markets will soften as people start to work remotely. The upper end of the market may also soften as the stock market corrects. Remember when people were having trouble off-loading their McMansions during the pandemic?
The market’s lower end will continue strong as people seek more affordable options.
Take a Look at Canada
I’m not an oracle. But the easiest way to see what will happen to the American market is to look at markets with the same issues.
We are essentially where Canada was about a decade ago, with prices rapidly approaching unaffordability. Everyone said, “The market will crash! It’s unsustainable!”
Well, maybe more; it’s gone up by 10x in that time. If Canada can support $1,000,000 price points on average with salaries lower than the US, we can too. That’s the reality, as unfortunate as it seems.
Canada has not seen a slowdown in purchasing, but people are moving further down the ladder. Rather than a 3-bedroom starter home, people are first moving into 1-bedroom condos and making their way up the property ladder.
And yes, seasonality is limited. The housing market is skyrocketing so fast that season-by-season doesn’t matter so much as month-over-month.
So, if you want to know when the best time to sell a house is… it’s probably now, regardless of the month.
Although, there is one more caveat…
Scheduled Rate Hikes in 2022
According to various sources, mortgage interest rates are expected to rise in 2023. The Federal Reserve announced a rate hike in March 2023, which may affect mortgage rates, among other things.
Forbes Advisor forecasts that the average 30-year mortgage rate will start at 6.6% in Q1 2023 and end at 6.2% in Q4 2023. However, the Mortgage Bankers Association predicts a lower rate of 5.7%, with the 30-year fixed mortgage rate at 6.2% in Q1 2023, gradually falling to 5.2% by year-end.
Despite some variations in predictions, it seems that mortgage interest rates are likely to increase in 2023.
Conclusion: It’s More Complicated Than You Might Think
Historically, the best time to sell a house is the first two weeks of May.
Realistically, no one wants to buy a house in the dead of winter.
But during a housing boom, all bets are essentially off. It’s impossible to tell what’s happening without understanding the market.
All these charts, numbers, and assumptions highlight the importance of having a real estate professional who deeply understands your local market.
The “regular knowledge” that everyone has established? It just doesn’t work with a market this volatile.
- Usually, March through July are the best months to sell. Historically, May has been the highest yield month. Lately, it’s been July.
- In 2020 and 2021, the market kept accelerating, so much seasonality was lost.
- When in doubt, you need to talk to your real estate agent.
Usually, the volume of sales is lower in the winter. Traditionally, prices are lower in the winter as well, but in recent years they have been similar to or higher than in other months. The lower volume of sales leads to higher demand.
Spring and summer are most common because people want to move when their children are out of school, but people sell houses all year round. There will be more housing stock in the spring and summer but more competition.
The best time of year for selling a home is usually spring and summer, but the market has been strong all year round in recent years. Note that “best” could mean either the fastest or highest figures.