Understanding The Annual Real Estate Cycle
The annual real estate cycle occurs within the context of larger factors and larger economic and market cycles that affect it. Regardless, the trends tend to stay true so lets start with understanding the annual real estate cycle.
At the time of this article we are in the Summer seasons which marks an apex of the cycle before it tapers down to fall and winter. During the summer months, due to things like good weather conditions and family or personal time allowances it is generally a good time to buy and sell. Houses showcase better in the nicer weather and the increased mood & energy adds to the activity levels. A lot of buyers and sellers need to get their home and real estate goals accomplished in this time.
Fall settles down as school begins for families and you see fewer listings and general activity. The market is more balanced for buyers and sellers and there is less of a frenzy. Overall there is less competition as we move out of Summer into Fall.
The Winter is a slowdown due to holidays and cold weather. There is still much business as individual needs always drive a certain portion of the market regardless of time of year. As a whole, activity decreases and thus there are fewer transactions. Sellers during this time may be more motivated to sell by years end or will simply wait and re-enter when the Spring market hits.
The Spring market is usually the time where we see the initial spike in activity driven by the increase in buyer activity as they enter the market. We can see slight increases in pricing as well. This is usually considered the best time to get things rolling. Inventory and options are better in the spring. Buyers may have some slight competition as more are entering the market and sellers will be competing more with other homes during this higher inventory time.
