Wednesday, October 19, 2016

As Winter Approaches, Should Sellers Wait for Spring to Put Homes on the Market?



The short answer is “no.”  Winter has proven to be a great time for listing a home, with less competition from other listings but still an abundance of buyers looking for a home.

I tell clients that December is now the “hottest” month when it comes to selling homes in Denver and Jefferson County. It’s shown in the chart I created (below) using the MLS, www.recolorado.com.

On that chart you can see that in December 2014 and 2015, there were a nearly equal number of active and sold listings. This was also true of the late winter months. January was the only winter month with low sales. In the summer, there were far more active listings than sold listings, meaning that if you are one of the sellers choosing to put your home on the market in the winter, you have less competition for buyers who are looking year round.
 

I no longer think of summer as the “selling season.”  Rather it is the “listing season,” because that’s when sellers assume it’s best to list a home. But the smart sellers list their homes in the winter.  I know, it sounds counterintuitive, but consider the following:
 
Last week I published a chart of the Golden Real Estate listings which sold recently at well above their listing prices. Most of them sold in less than a week. That only happens when you attract multiple buyers by pricing a home at market value, rather than at a wished-for higher price.

Recognizing that only one buyer won the bidding war for each of those homes, that means all the other buyers are still looking.  Even if they get discouraged and stop looking actively, you know they’re keeping an eye on listings, and if your home matches what they’re looking for, they’ll ask to see it.
 
That’s why it’s smart to put your home on the market in the winter months. But beware of overpricing your home. I recommend using my personal strategy of pricing your home at that sweet spot — low enough to attract multiple offers quickly — and then working with the agents submitting offers to get the highest price. As I’ve written before, this is no different than how an auction works.  If you’ve been to an auction, you know that the auctioneer starts the bidding at a low price to get buyers engaged, and then lets buyers drop out as the price rises due to competition. The same process works for selling a home. We know, because we do this all the time, as demonstrated by that chart in last week’s column. (If you missed last week’s column, you can read it at www.JimSmithColumns.com.)

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