Real Estate Markets: How Much Time to Sell A House?
Anyone that is looking to sell a house for the first time will likely have several important questions that much be asked before getting started. This is why consumer research is critical, as it allows you to better understand the financial environment in which your housing market operates.
Perhaps the most common question is the question of time: How long will it take to sell my house?
In many cases, it is difficult (or impossible) to move your family into a new home before your previous house has a buyer. Long sales periods can make life difficult, and prevent your family from pursuing its dream of homeownership.
Understanding your circumstances
First, it is important to understand that not all home sales situations are created equal. There are many different variables involved which could make it more difficult (or even make it easier) to sell your home quickly.
One house might sell in five days, while another house (which may seem similar) could take five months or more before a new owner is found. Every situation is different, and having a proper understanding of your goals is critical whenever you are listing a home for sale on the market.
One factor in determining how quickly your home will sell lies in its geographical location. Is the house in a downtown area, the suburbs, or out in a rural location? Typically, the farther your home is from a heavy population center, the longer it will take to sell. Of course, there are always many exceptions to that general rule.
In “real estate speak,” a housing market is “balanced” if your listing in an area where most homes sell in under six months. A geographic area is “neutral” when there is a roughly equal number of home buyers and home sellers such that market sales do not stagnate. But this also means that neither side has a substantive advantage in price negotiations. This is referred to as the “market absorption rate” shown in the graphic above.
If your location experiences an unexpected variable (i.e. when a big manufacturer or company leaves the area), time frames could be extended. Having a large employer in the area means that your new homeowner family will not have any difficulties finding work if they buy your house. This is always an extra bargaining point, and an advantage for the seller. But, when a major employer leaves the area, it could become more difficult to sell the home. This gives buyers the leg-up when negotiating prices.
Seasonal factors are also a consideration. Sometimes, it is just harder to move in the winter (especially in snowy areas). Families also tend to wait until the end of a school year before moving. This could make it more difficult to sell a home quickly during these months. Overall, the average time could be 30 days in fast markets, (i.e. upscale, downtown) whereas a slow market (rural areas) might encounter average time frames of around nine months.
Many people might avoid house hunting during the holidays, so spring and summer are the seasons when average market time might be less than a neutral six-month period. Some view the fall and winter months as good times to shop for homes. One way to get a good deal is to find a motivated seller with a house that has been on the market for longer then the six month period.
Assuming that something like radon deposits will not be found in your home, and the property is not recognized as a landmark district, the combined influence of the financial markets, buyer demand, and the season all help determine the average time before a house will sell.
Unfortunately, there is no single answer that will let you know how quickly you can sell your home. But we can make educated guesses based on certain factors that are unique to our circumstances and unique to the house itself. The best way to have your home sold quickly is to start early and remain active. This means networking through social media and sales listings in order to make sure that your property is being seen by as many prospective buyers as possible.