Photo: Tim Grafft/Flickr
Spring traditionally marks the unofficial start of homebuying season in the US. But according to a new report by the listing site Zillow, late summer may provide homebuyers reduced prices and a larger inventory to choose from.
Although there are generally more new listings during the spring months, competition can be fierce. Buyers that purchase a home during the spring buying season are more likely to pay above the listing price, says Zillow. Homes listed in late spring also tend to sell faster.
But Zillow’s analysis of 2016 buying trends revealed that there were more homes for sale at the end of the summer than any other time of the year. The month of August had more active listings than any other month in most major metros, says the listing site. For example, the hot Seattle’s hot market had about 5,000 more listings in August 2016 compared to April 2016.
Another factor for homebuyers to consider is that as summer comes to a close, many sellers begin to worry about not selling their homes and will often slash prices. Last August, 15 percent of all listings on Zillow had price reductions. Buyers in larger metro areas are more likely to find a listing with a reduced price in August and September, says Zillow’s data.
This year, as summer inches closer, the national inventory is currently 5.3 percent lower than it was a year ago. According to Zillow, inventory is still “well below” levels observed five years ago in many markets that have seen recent increases in the number of homes for sale.
Buying a home is a process that for some buyers can take several months, often with a couple of unsuccessful offers along the way. Homebuyers who strike out during the spring buying season might find a better deal in the late summer when sellers are more eager to move their property.
“In such a competitive housing market, it’s easy for buyers to get frustrated when they are putting in multiple offers without success,” says Zillow chief economist Dr. Svenja Gudell.
Patient homebuyers who wait out the spring buying season may find the market conditions more favorable in late summer.
“Homes that may have been overpriced earlier in the year are more likely to have a price reduction, and those listings passed over in earlier months may look better with a fresh perspective,” adds Gudell.
It’s interesting to note that CoreLogic’s Home Price Index earlier this week predicted that not only would national home prices increase over the next year, but would hit a new peak in August.
Click here to read the entire report.