May 26, 2007
When is the best time to sell a home in Los Gatos, or Silicon Valley generally?
Many people think it’s spring, others summer. But is there a best time?
The answer is: it depends. . . and it varies.
Usually there’s a runup in real estate pricing from January to some point later in the year. Then it levels off. Sometimes it even declines a little. Sometimes not. Once in awhile, there’s a second runup in the real estate market too. A couple of years ago, August saw a 2% increase in pricing (other years, we’ve seen a decrease in pricing then). It’s actually hard to predict. But normally, things heat up in January, February, and March. That part is usually fairly predictable.
Some years, the “peak” of the pricing for the year is early (March, or close to it). Other years, it’s later – sometimes as late as July.
Last year, the realty market began declining in March and that “correction” continued until September. Then home prices leveled off and skated along, pretty much holding value, until January. Then they took off like a rocket again in the higher priced homes of Silicon Valley. Not so for places on the east side, really.
Other years, we’ve seen the market stall out because of something like an earthquake (October 1989) or a terrorist attack (September 2001), These things cannot be predicted but they do impact the market.
Besides pricing, another consideration is the cost of money. That is, what are interest rates doing? Remember that you don’t really “get” a loan, you “buy” one. You are purchasing a loan product. It’s a supply and demand issue. So when the demand is high, generally interest rates will be higher as compared to when the demand is low. Demand for loan products tends to be at a low point in the dead of winter. Interest rates often start ratcheting up close to Valentine’s Day (mid-February).
There are not a lot of easy answers. Selling your Silicon Valley house in the dead of winter can be very advantageous because interest rates are low, there’s not much inventory, and the “absorption rate” (the rate at which inventory is “absorbed” by the market) is often better than it is in summer.
Another consideration is what you’re planning to do once you sell your house or condo: cash out or buy another home. For move up buyers who are not picky but really want “a good deal”, it may be best to sell first in spring or early summer and buy later, in late summer for instance, when the market may soften. For pickier buyers, it may be good to sell their property early in the year (or more in winter) and buy later (more in spring) because the rise in inventory will provide more choices – though usually at a steeper price.
No matter when you want to sell your home, there are some key things to keep in mind, including realistic, strategic pricing (overpricing is the number one reason why homes won’t sell), good staging (knowing which improvements to make, decluttering, keeping the home clean), and good marketing (make sure it’s on the web and in all the right places!) are all key. It is also very, very important to hire well. A poor agent can make or break your home sale from the start. A good agent will assist you – if you let him or her and follow the advice given – to maximize your place in the market.
A couple of years ago, I co-authored a book, “Get The Best Deal When Selling Your Home In Silicon Valley“. The book covers a myriad of topics from how to choose your local agent to pricing and what to expect in escrow and how to do a move-up sale/purchase. The book is available at local public libraries (Los Gatos and San Jose), at Border’s Books, at nearby Barnes and Noble, and via Amazon.com. Or you can ask me to view your home and talk about your plans or thoughts on selling and I’ll bring you a copy when I visit. But in any event, I do suggest you read this book (no matter whom you hire to help you sell it) so that you go into the home selling process the wiser.
Your best timing depends on a number of things, but most of all, it depends on your particular circumstances. Beware the idea that there is “one right” month to go on the market. It just isn’t so. In my practice, I have seen countless people try to time the market right, but fail to stage or price the home correctly – and so despite the timing issue, it doesn’t sell. And conversely, I’ve seen others work hard to stage and price a home correctly and seen it sell under the most adverse of conditions.
Timing matters. But contrary to popular belief, timing isn’t everything. It’s only one part of the puzzle.
If you do it right, you can be successful at selling your Los Gatos home at any time in the year.