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Seasonality in Real Estate

Today we will address some misconceptions we have heard of the real estate market, specifically that "summer is the best time to sell", and though it is true that most transaction close in May, June and July (with June being a peak), many go into contract (mostly for 45 days now) in March, April and May, after starting to think about it after the new year. Below is a chart of the existing home sales nationwide, the date includes up to April 2016:
raw-ehs
This applies not only to sales, but also to rentals, though we have much less data to show this, anecdotal evidence (we have 7 moveouts for June 2016), experience and thinking through it should make it clear that most renters do not want to move in November and December.
In Chinese culture, the 'Dragon Boat Festival' (or "Duanwu Jie") is a summer festival, this year starting on June 9, 2016, it essentially celebrates the Summer Solstice. This is important as this is a vacation time for this segment of housing demand.
Activity tends to slow down after Memorial Day (as the market is feeling now) as children are on summer break, with the 4th of July being another dip in sales activity until September.
There is also the expression in the stock market to 'Sell in May and Go Away', which carries  this same philosophy.
Note that seasonality is not destiny, and as there is also less inventory available at those times, below are figures for Orange County:
Orange County
Note in the above chart, that 'for sale' inventory builds after May as the red line (pendings) dwindle.
In conclusion, the best time to get the best price (for sale or lease) of your real starts in March, builds and peaks in  May, then drops after July, with July itself closing out those going into escrow in May and June.

Yorba Linda, CA-TRREG DRE#01843673-RP100 DRE#02059058-P:714-831-1800-E:info@theresultsrealestategroup.com-W:www.theresultsrealestategroup.com-Facebook - Twitter - Instagram - LinkedIn

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