Normally, December is a ho-hum month for Twin Cities home sales—and that could well be the case again. Across the nation, 2018’s leadup has performed pretty much as expected. Home sales slowed as the number of home listings stayed in short supply and mortgage interest rates crept upward. So it would surprise no one if Twin Cities home sales followed the national trend.
But instead of a sleepy year-end market, a year-end surprise might be possible. That’s the studied opinion of CNBC’s respected real estate commentator, Diana Olick. December is “usually the slowest month for home sales,” she writes; “but that might not be the case this year.”
Last week’s pronouncement came on the heels of a dynamic stock market swoon but had little to do with that or other financial jitters. She pointed to three unique dynamics that make this December “one of the better times” to both buy and sell:
- Interest rates. After rate increases having turned “what was a red-hot market into a lukewarm market,” Olick found that buyers are now likely to seize the moment. With mortgage rates hovering below 5% yet almost universally expected to move higher in 2019, that fact alone is “motivating buyers.”
- Prices. ‘Tis the season for bargain hunters. Web titan Zillow reports seeing a “sharp increase in the share of properties with price cuts.” Although the housing market can always be counted on to let up once the kids get back in school, this year “is shaping up to be more favorable for buyers.”
- Competition. Quoting Realtor.com’s Chief Economist, “December is the best time of year if you want to avoid competition.” Recent history bears that out, with online views per property normally 21% lower in the final month of the year. After contending with hot competition throughout the rest of the year, buyers may appreciate the reversal.
- Motivation. With supply and competition at their low points, for both buyers and sellers “motivation is at its high point.” Because the holidays can be an awkward time to buy or sell, those who step up can be counted on to have good reasons. Per Realtor, “Buyers may have to move, and sellers want to get to their next location.”
I agree that this year presents a unique set of circumstances that could power our December Twin Cities home sales beyond what is normally expected. In any case, RE/MAX Preferred will be by the phone should you decide to take advantage of the moment!