Pro Tip: When is the best time to sell?
You: When will I make the most money selling my house? It’s spring or summer, right?
Me: You can make the most money selling at any time if you know how the market trends throughout the year and take advantage of that cycle. What, you don’t know how the market trends? Phew! Good thing you called me.
By far, the number one question on a potential seller’s mind, and what we get asked most often, is “When is the best time to sell my house?” What they really want to know is, “When will I make the most money selling my house?”
The real answer is “Any time you want to move.” Because yeah, there are some hot months and some cooler months, but selling for the most money comes down to knowing what buyers and sellers tend to do in different seasons and strategizing to that behavior. If you don’t have a killer strategy in place, you can put a house on the market in a hot month and it can sit for weeks and get bid down. On the flip side, you can sell in a cool month and have a bidding war. You just need to understand how Denver’s primed sellers’ market works throughout the year.
Still confused? Don’t worry, we’re not. The Dwell seller strategy — designed to maximize your selling price — is based on three principles:
Understand how an extreme sellers’ market works over the seasons
Strategize your sale based on the season
Market like a boss
Those are the basics; let’s chat through the details.
STEP 1: UNDERSTAND HOW AN EXTREME SELLERS’ MARKET WORKS OVER THE SEASONS
Denver’s extreme sellers’ market definitely has what we’ll call “hot months” and “cooler months” in terms of real estate sales. But honestly, there are no “cold” months. Even in December, the Denver housing market is toasty warm for a seller.
So what determines if a month is hot or cool? The number of buyers looking versus the number of houses available to buy. We’ll spare you from the billion statistics that we nerd out over every month and just say that, in short, our hotter months are February-June. Yep, June. Crazy enough, it starts to cool in July. Check the graph below. It shows how housing prices actually go up from January-June and then drop July-December.
This trend started in 2014 with the rise of the extreme sellers’ marker and is current through today. But if you’re reading this in August and want to sell your home, don’t worry! You can still sell for a great price July-December! Just keep reading.
STEP 2: STRATEGIZE YOUR SALE BASED ON THE SEASON
The secret is understanding how the price trend works in your favor, which gives a seller (you) a huge advantage over the competition (other sellers) and their target buyers (the folks you want to bid your property up).
No matter the month, the number one mistake in this market is to overprice a house. Stats show that overpriced houses sit on the market extra days and cause potential buyers to start wondering “What’s wrong this house? Why hasn’t it sold already?” Smelling an opportunity, buyers start bidding the house down instead of up. Bidding down is not the way to make the most money selling your house!
The most important factor in our selling strategy is intelligent pricing. Hands down. Stick with us on this one — there’s a reason this section is longer!
Let’s pretend you’re selling a home in September. Since you know that housing prices start to drop in July, and flatline or continue to drop each month through December, you can use this knowledge and apply it to your agent’s market analysis and price accordingly. How? Find the market value that you think you’ll get and strategically drop the price below that.
But how much do you drop it? This is where you need a good agent; someone who understands the market trends and can give you an expert opinion. This is a time when experience matters! Even if you’re selling in the hottest throes of May, you need an agent who won’t make the rookie mistake of overpricing based on upward selling trends and causes an amazing house to sit and stagnate in this market.
To find out if your agent gets this, ask him/her what her stats are for the houses they’ve sold in the last year or so. Find out the agent’s percentage of “sales price to list price” (how much over list price each house has sold). An agent who understands effective pricing should be able to show you a sales price of 101% or higher over asking price on most of those houses. Side note, it’s not realistic to expect that every house will sell for over asking price. We all know that there are some houses that just won’t get bid up for unusual reasons and the agent may have had a few of those clunkers! But overall, if the agent doesn’t show a strong trend of getting houses sold for over list price, keep looking until you find someone who does. (Hint: it rhymes with Swell Senver.)
Another counterintuitive truth to keep in mind when pricing your home is that you really can’t underprice a house in this market. Unlike when a house sits on the market with a high price tag, buyers don’t look at a house priced lower than market value and say to themselves, “There must be something wrong with it, let’s skip this one.” Instead, they say “Why is it priced so low? How high do you think this one’s going to go? Any chance we can offer high enough right out of the gate?”
No matter the month, you won’t be leaving money on the table with a slightly underpriced home. The lower a home is priced, the more buyers that will come see it, and the likelier it will be that you’ll find yourself with a bidding war. Stats also show that the lower the initial asking price, the faster a house will go under contract. You may even end up with a flash sale! This is a term defining a house that goes under contract in under seven days. As of March 2018, 68% of detached home sales in Denver this year were flash sales (Land Title 3/18 Market Statistics).
Good agents know all of this because they’ve seen it play out in their clients’ favor time and time again. They price lower than market in both hot and cool months. This gets you lots of potential buyers and is what drives prices up in any season.
STEP 3: MARKET LIKE A BOSS
The final key factor in selling for as much money as possible is effective, beautiful marketing. While this is an entire blog post on its own, the short version is that 99% of buyers start their house hunt online, and professional pictures and marketing materials will hook them before they leave the computer.
Conversely, bad pictures and bad marketing will lose potential buyers. No matter how great your phone’s camera may be, amateur pictures do not inspire people to get in their cars and go see a house! How many times have we seen the seller or their agent reflected in the bathroom mirror with their camera? Lazy marketing from a partially-committed agent means that lots of buyers may not even visit a property because it wasn’t listed in a place they’d see it or the pictures failed to capture their attention. Remember, amateur marketing materials look cheap and will emotionally signal buyers to assume that the house itself is of lower value.
That was a lot, right? But it really just boils down to this: The best time to sell your house is any time you want. You just need to know the market movement and turn it into a sales advantage. You can create a bidding war in the dark days of November just as easily as you can leave money on the table during the buying frenzy of June. Your best tool is an agent on your side who understands the market seasons, tactical pricing, and the importance of intelligent marketing. Dwell’s seller strategy is designed and proven to help you create the most likely environment for a bidding war and get the most out of your home sale.
Ready to sell at the best time?
