For the past six years, Rokham Fard and his colleagues at online brokerage and big data hybrid TheRedPin.com have been collecting and sifting through data from hundreds of thousands of home sales a year to find the best month for listing and the best month for buying.
“When you look at sales over five our six years you have accrued a large enough sample size to account for all the anomalies, for all the rate changes and all the emotions that are involved,” explains the co-founder and chief marketing officer at the Toronto-based tech company. “There’s a pattern… a big gap between January, which is the best month to buy as it’s the least expensive, and May, which is the best month to sell.”
It’s a $60,000 difference in prices, says Fard.
“That is a big enough gap to at least pay attention to when you look at average home prices being south of $600,000 – that’s 10 per cent,” he says. “It’s easier for buyers to negotiate asking price in January (when) homes sell for 2 per cent below asking price.”
Overall, homes sold in May fetched higher prices compared to any other time of the year at about $18,650 above the calendar-year average, says Fard. Spring in general sees the highest levels of home buying activity in the year, accounting for 47 per cent of market activity.
Melanie Piche and Brendan Powell, lead brokers with the BREL Team, a part of Sage Real Estate, say the weather plays a part in spurring the real estate market.
“A warm early spring can get people out and a really frigid winter can keep people away,” says Powell.
It’s also a more aggressive market for buyers stumbling out into the cold in January or February.
“All the sellers want to sell when it’s spring and the gardens are pretty and all the buyers are out in January,” says Piche. “So February and March are traditionally the high list-to-ask ratios – that’s when you’re getting people showing up to a bidding war.”
But the time of week also shouldn’t be overlooked.
“I would list a house on a Monday, Tuesday or Wednesday,” says Powell. He explains that from a selling perspective, a listing will take a couple days to go through the MLS system, be flagged by a realtor and sent to potential buyers.
“You want to make sure that people get to see or are alerted to your property with enough time to plan their visit in the evening that week or at the open house on the weekend,” he adds. “I wouldn’t want to do it any later than Wednesday because then the risk is that by the time people see it, it’s already Saturday morning.”
While all three brokers admit these rules are more general than anything, TheRedPin.com’s data argues a strong case for sellers holding off listing their homes until spring.
“If you’ve got the patience, if you can wait – be zen about it,” says Powell.