When is the peak home sales season in your state? Most people believe that spring and fall are the peaks seasons and spring is true for most states. Because of climate differences, the peaks do vary from region to region and state to state.
The one constant is that most families do buy houses in rhythm with the school year. Because buyers want to move their household during drier/warmer months many tend to begin house hunting during the spring so that they can be settled into a new home by the time the school year starts in the fall. However, according to a study by Trulia, in year round good-weather states, peak online searches for houses happens in January for Hawaii and February for Florida. Still, 18 states see the peak in March and another 12 see the peak in April. A little surprisingly, 15 states see the peak searches in July during vacation season. Only Mississippi sees the peak in July. The only other month that sees a peak is August for Montana and Oregon. Although many perceive a second peak in the autumn, the numbers don't support the perception. No peak occurs in any state from September through December.
Not surprising is that sellers anticipate these peaks and place their homes for sales at the same time that the most buyers are looking for a home. For the majority of states and regions that time of the year is only weeks away.
According to the S&P/Case-Shiller’s Home Price Indices, in the previously owned housing market appreciation has slowed but it's far from dead. As of November, the national rate of home appreciation was 4.7% with the highest appreciation exceeding 8% in San Francisco and Miami.
The Chief Economist for Zillow believes that the housing market is at its historic norm - a balanced market for buyers and sellers with appreciation at a sustainable pace. The strongest appreciation is happening at the bottom of the market. The result should be an increase in inventory coming on to the spring market as the last of the under water mortgages again see daylight. Although increasing prices will present a challenge to first time buyers at the low end of the market, the increase in inventory should prevent bidding wars.
Overall, this spring buying season should be better for buyers than the previous two when sellers were in control because of the limited inventory on the market. Not only is the previously owned home inventory increasing but also new construction is finally making a slow come back.
This is good news for a sustainable recovery because the lower end of the market was the hardest hit by foreclosures and under water mortgages. That wasn't surprising in view of the fact that lower paid workers took the brunt of the hit during the recession. That led to foreclosures and the declining real estate market. The wealthier among us sailed the turbulent recession with much less negative financial impact. First time buyers should welcome this change.
Any weakness in the spring market is likely to be triggered by rising interest rates. With average mortgage rates remaining below 4%, a negative consequence to the market is not likely to occur. Even if rates rise above 4% the impact should be minimal. The trigger point is likely to occur if rates approach 5%.
Overall, the spring residential market looks promising.
Author bio: Brian Kline has been investing in real estate for more than 30 years and writing about real estate investing for seven years. He also draws upon 25 plus years of business experience including 12 years as a manager at Boeing Aircraft Company. Brian currently lives at Lake Cushman, Washington. A vacation destination, a few short miles from a national forest in the Olympic Mountains with the Pacific Ocean a couple of miles in the opposite direction.