Whether you’ve lived in it for 3 years or 30, your home is a part of your life.
As a homeowner, it’s also a big part of your financial future. So if you’re thinking about selling your home, it’s usually for a good reason:
- Your family is growing and you need to find a larger home
- You need to move for work
- You have taken ownership of a family home and choose not to live in it
You may also need to sell your home if you’re having financial problems or need to short sell your home to avoid foreclosure.
Of course, like the Rolling Stones, you want to be able to say “time is on my side” before you sell.
Knowing when to sell your home is about more than dates on a calendar. It’s about timing and managing the sale of your home to ensure that you can get the most value from the sale before it becomes someone else’s home.
So when is the best time to sell your home?
When People Want to Buy: Time It Right
What is the best month or season to put your home on the market? The traditional answer is late spring, early summer. Why?
- Cabin fever: The days are getting longer, the trees are in bloom and the weather is warm. After being cooped up all winter long, people are looking for a change. It’s a good time to be outside and walking through neighborhoods looking for open houses.
- Tax refunds: After April 15, people’s tax return money may start burning a hole in their pockets.
- Curb appeal: Let’s face it, houses look more appealing in the spring and summer. The grass is greener and the sunlight flooding your home will beautify it better than the Clarendon filter.
- More time to move: The summer gives everyone more time to move. The days are longer and people are making full use of their vacation time. If the home buyers have kids, they’ll have enough time to get them registered for the coming school year.
The idea is that homes listed around April and May will be snatched up first, with sales continuing through the summer.
By fall, the weather gets colder and home sales tend to decline. By winter, everyone is focused on the holidays. Come January and February, everyone is recovering from the holidays and prepping to file their tax returns. And in early spring the cycle repeats.
Of course, that only makes sense if you live somewhere where you have a winter.
In sunbelt states, like Florida and Arizona, December can be peak season for sales because the weather’s cooler, and new home buyers looking for a winter home may be eager to be moved in just in time for Christmas.
In high-demand areas like New York, New York, or San Francisco, California, it’s always a seller’s market!
When the Housing Market Is Your Friend: Buy Low, Sell High!
The only constant is change. It’s one of the laws of nature and one of the rules of the housing market. Experts can make predictions, but no one knows exactly what the housing market will do. That said, there are some easy-to-read signs that you can count on when trying to figure out if it’s a good time to sell.
When mortgage rates are low, homes become more affordable and home buyers are motivated to search. Another benefit is that low interest rates can make it easier for you to borrow against your home equity if you need to make repairs or renovations before you sell.
Changes in the area
Neighborhoods can change in the blink of an eye. Your grandparent’s’ working-class neighborhood may be flooded with young families, and that sketch industrial area is an on-trend arts district.
Depending on where you live and your time frame, if a neighborhood is going through a renaissance or turnover, you may benefit from waiting for prices and competition to rise before you sell.
On the flip side, if an area is losing businesses, and people are moving while new buyers aren’t replacing them, it may be a big red flag that it’s time to sell quickly before prices drop further.
Seller’s market or buyer’s market: It depends
The rules of supply and demand are fixed, especially in the real estate market. When the number of buyers exceeds the number of sellers, there’s increased competition, which increases prices and makes potential buyers more willing to meet your list price.
If you want to gauge demand, look at your neighborhood as if you were a home buyer. Ask yourself these questions:
- Does the number of available homes seem to be growing?
- Are home prices rising or falling?
- Are homes staying on the market for less than a month?
- Are homes selling at or above the asking price?
If the answers to all of these questions are yes, you may be in a seller’s market and it may be a good time to sell. A real estate agent can help you gauge the market as well.
When Your Home Looks Good: Appearances Count
Before you sell, you’ll want to present your home in the best possible light.
To do this, you’ll need to improve your home’s inside and outside appearance by making repairs, renovating, landscaping, cleaning and staging your home.
Or if you prefer to sell your home “as-is,” make sure you understand how that can affect the type of buyers you’ll attract and how much they’ll be willing to pay.
You’ll also want to make sure your home’s finances are solid. Make sure you’re up to date on property taxes and mortgage payments. You can also check your property title to make sure there are no outstanding liens or other red flags on your home that might scare off potential home buyers.
When You Can Sell For A Profit: Keep Money In Your Pocket
As a home seller, the profit you’ll make from your home sale is measured as home equity. It’s the difference between the balance of your current mortgage and the sale price of your home. Ideally, you’ll want to have equity available to apply toward your next home or the next stage of your life.
But before your home has been sold, you’ll need money to cover realtor commissions, closing costs, fees and expenses related to the sale of your home.
You may also need money to make additional repairs if a home inspection reveals issues. If you don’t have enough equity to cover these expenses, you may find yourself in debt after you sell your home.
When You Have a REALTOR® or Sales Agent: They Have Connections
Perhaps no single expense is greater than the commissions for both your real estate agent and the buyer’s real estate agent. These fees can equal 3% – 6% of the sale price. Listing your house as For Sale By Owner (FSBO) can save you thousands of dollars. But you’re also likely to make mistakes when selling your home. There are significant advantages to working with a real estate agent:
Experience is on your side
Real estate agents may prefer to work with fellow professionals rather than negotiate directly with home sellers. But they also may steer their clients away from FSBO sales, reducing the number of potential buyers for your home.
Price and reality check
A good real estate agent will help you price your house so that it’s competitive. Price too low, and you’ll lose money on the sale. Price it too high, and you’ll turn off potential buyers before they even make an offer.
Check your feelings: Prevent emotional selling
We all have deep emotional connections to our homes, and we may also have financial goals and dreams connected to the sale. A real estate agent can make sure you follow the Corleone family mantra: “It’s not personal. It’s strictly business.”
Listing your home
Real estate agents have access to listing networks and resources that will allow your home to be seen by more potential buyers in less time. They’ll also know all the secrets of how to sell your home.
Sell your home online
More home buying than ever happens online. One study from the National Association of REALTORS® (NAR) shows that 93% of home buyers use websites to research their next purchase. So listing your home online is a vital part of the home selling process. A REALTOR® can help list your home online, arrange for professional home photos, and they can create virtual tours that will put your home in front of more eyes.
Handle the paperwork
Selling a home requires lots of paperwork. Real estate agents are trained to know what’s required and how to get it done without making a mistake. A real estate agent also has a network of lawyers, notaries and other real estate professionals at their beck and call, saving you the time and expense.
So You’re Ready To Sell Your Home
Selling your home can be a complicated process, both financially and emotionally. If you time it right and find the right time to sell, it can make the process easier and help you get more money from the sale.
National Association of REALTORS®. “2020 Home Buyers and Sellers Generational Trends Report.” Retrieved November 2021 from https://www.nar.realtor/sites/default/files/documents/2020-generational-trends-report-03-05-2020.pdf