And So The Fall Real Estate Market Begins…
September 4, 2018
Labor Day Kickoff.
For many people, Labor Day weekend marks the end of Summer and the beginning of Fall, even though the calendar still allows for 3 more weeks before the change officially happens. The kids are all back in school, and it's the last extended weekend until Thanksgiving, so it represents one final chance to relax before revving life back up to normal speed again.
In the real estate world, Labor Day weekend traditionally marks the “official” beginning of the Fall market, which is a two-month intense period of listings and sales. In reality, the Fall market now actually starts in mid-August as opportunistic sellers take advantage of the fact that almost all schools start well before Labor Day, and that many buyers are back in town and aggressively shopping for homes. I listed a home in Sunnyvale two weeks ago, and sold it in 7 days with 7 offers at a premium of $277,000 above the asking price. So clearly, home buyers are back in action well before the long weekend.
The Fall market feels much more compressed than the Spring market, simply because we're trying to accomplish the same sales in half the time. Once the calendar hits the end of October, the real estate market definitely starts to cool down. There or two main reasons for this change. First, Daylight Savings ends at the end of October, which means it starts getting dark again at 5:30PM, and that makes it really difficult to show houses during the weekday evenings. Second, once the calendar hits November, it seems like everyone's minds start to shift into holiday mode. So, for home owners looking to sell in the Fall, timing is everything.
What to Expect in the Fall?
In a typical pattern of summer sales, we see a soft month of listings in July, followed by an uptick of listings in August, and then a pretty big surge of new listings in the month of September. The latter is driven by home the desire of seller's to “beat the clock” and get their home sale closed before the end of October. Last year demonstrated this trend almost to the letter:
In fact, the “Fall Effect” was so dramatic last year, that there were more new listings in the month of September than in any other month of the year. This is one of the few times in the year that buyers actually feel as if there's a decent amount of inventory to choose from.
If we look at 2018 so far, it appears to be following the same trend. A relatively light listing performance in July was followed by a significant upward inflection in August, but even more pronounced than in 2017:
The only missing piece of the puzzle is what is going to happen in the month of September. Based on the activity level that I'm already seeing and the number of “coming soon” listings that I'm aware of, it appears that September of 2018 will be another robust month for single family residence listings in San Carlos. I doubt that it will be as dramatic of a difference this year, however, since the August numbers were so strong. That would mean that home sellers are finally picking up on the notion that it's far better to sell early in a the season, rather than waiting until everyone else is on the market.