Most people think that buying a home during the holidays is a bad idea. Maybe they think that waiting for more inventory is a better idea. That's true, there will be much more inventory in March than there is now, but if you're looking to get a great deal on a house, November through February are the months with the lowest average sale prices year after year.
Let's look at the statistics from the Northeast Florida MLS database over the past 2 years to provide you with some visual proof...
Past 2 years - Lower Average Prices in Winter
Looking at the graph below, you can see the the average sold prices of homes was significantly lower in November - February than they were during the summer months in both 2017 and 2016.
Average prices in January and February over the past 2 years were around $210,000, and average prices in June for both years averaged around $232,000. Please note that these average sales prices are from the entire Northeast Florida MLS database, not just Ponte Vedra, hence the low numbers. The point is that on average, over the past 2 years, homes have been selling for around 10% less than during the winter months.
Inventory Begins to Decline in September
As we enter the Fall season, the number of listings begins to fall as well. As you can see in the graph below, housing inventory generally starst to decline in September, and then begins to grow again starting in January.
In this graph, the inventory in Jacksonville peaked at around 9,261 home listings in April of 2016, and then fell to 7,640 in January, a difference of 1,621 listings. In June of 2017, there were 8,126 homes actively listed for sale, and then that fell to only 7,333 listings in November of this year. This is the trend year after year.
What does this mean if you are a home buyer?
Doesn't the lower inventory mean that homes will sell faster and for more money? This isn't necessarily the case. Yes, inventory decreases, but the amount of houses that are actually sold decreases also. Looking again at the graph above, there were around 3,212 homes that sold in the months of January and February in 2017 combined. In June and July of 2017 there were 5,092 homes sold. That's almost 2,000 more homes sold!
This means that as the housing inventory decreases from September through January, so does the DEMAND! There are not as many buyers out there actively looking to purchase a home during these winter months. People get tied up during the holidays, or the colder weather somehow lessens their desire to go out and house hunt, or whatever their reason is, they are putting off their home search effort until the early spring. For you, the now knowledgeable buyer, you now can use this information to your advantage and go out and find a great deal on a house!
Want another reason?
Sellers are usually more motivated
A big reason why inventory declines in the winter is because sellers who didn't get their home sold over the summer will take their homes off the market in September and re-list in February or March. Most of the homes left on the market throughout the winter are still there because the seller NEEDS to sell. This obviously works to your advantage when negotiating the price of the home. During the winter months, the big decline in home showings, inquiries, offers, etc. are all factors that push these sellers into selling their home for less money than they would like. This is a fantastic situation to be in as a buyer! Of course, you have to like the house too. :)
Where's the best place online to search local real estate for sale?
If you're a current home buyer, or plan on being an active buyer in the future, you have many options for home search websites. I highly recommend using my local home search site. It is updated every 5 minutes from the local MLS database, so it is more accurate than any site out there and it will never show you home listings that have recently gone under contract. Some of the major national websites out there like Zillow and Trulia do not update their listings when a home goes under contract. At least 40% of the phone calls and emails I get from people using these sites are inquiries about properties that have already gone under contract, and 40% is a conservative estimate. Sometimes they are calling on properties that have already sold & closed! Can you imagine falling in love with a house online, only to find out that it's no longer available? It's not a great feeling. So just stick to using my website. It will save you a lot of hassle and frustration I promise. Feel free to start a new search below!
- Jake Bestic, P.A.