Real Estate NewsHoliday Home Sales Defy Real Estate Lore
"Homes don"t sell during the holidays." That statement is yet another urban
legend that the real estate industry would like to see erased from the minds of
buyers, sellers...and REALTORS®.
Low interest rates, a booming resale market, high unemployment, low
inflation, and the increase of first-time homebuyers, transferees and empty
nest homebuyers entering the market have combined to create a record-breaking
year for the real estate industry. Is there any reason this positive selling
environment has to change for the holidays?
According to the professionals at Coldwell Banker, the holidays are proving
just as active as other times of the year. Several reasons point out the
reasons for this trend - an increased demand for homes, the proliferation of
non-traditional buyers, and a heightened emotional connection to home life
during the holidays.
"During the winter, people looking for homes are those that are serious
about buying. There may be fewer lookers and homes on the market, but the ave
rage sale time remains the same winter or spring - about 90 days," says Curtis
Irving, broker/owner of Coldwell Banker Curtis Irving Realty in Oregon.
In some regions, homes are selling even faster during the holiday months. In
the Dallas market, homes sold in an average of 68 days in November, down from
last year"s 81-day DOM. Currently listing levels are at record lows with less
than a two and a half month inventory in a market that normally averages six
months or more on hand.
The real estate business used to be seasonal, with families waiting for
warmer weather and for the school year to be over to make their moves. Summer
is still the biggest moving period of the year for families with school-age
children. June is the leading month, with 13.1 percent of all moves, followed
by August, at 12.6 percent.
But more and more people are choosing to move after the school year has
begun in September, especially over the age of 45, according to the U.S. Census
Bureau. First time buyers and trade up buyers split the market, and each group
has non-traditional members who are gaining an increasing hold in buyer
demographics. The empty nester, for example, has shown a preference for moving
in late fall or late winter. Many of these buyers who are in "tight" real
estate markets are actively looking for homes during the holidays and they are
serious.
Non-traditional buyers are an increasingly important factor in the home
buying market, according to a survey by the National Association of REALTORS®
completed in 1997. Although married couples with children continue to make up
the majority of home buyers (64 percent) only 25% have young children or
babies. Single women accounted for 18 percent of homebuyers, and single men
came in at 11 percent. Unmarried couples accounted for five percent of
homebuyers.
According to the U.S. Census Bureau, the average household has dropped from
3.5 people in the 1970s to 2.5 people, meaning that fewer than half of all
households have even one child in residence. The divorce rate of 50% is adding
to that figure, as families with primary custody are producing households with
non-custodial parents who need extra room for children on "visiting" days but
who actually have no children in permanent residence.
Between singles, empty nesters and non-traditional couples, there is little
incentive to rush into home buying during the spring and summer months, when
prices are at their highest and when services such as movers, window treatment
installers and landscapers are the most difficult to obtain. To these buyers,
the winter months pose an advantage, when they can obtain customer-hungry
services without the pressure of competing families.
Winter is the ideal time to negotiate a home. Because the trees are stripped
of their leaves and shrubs are less full, the buyer can actually see more of
the home during the winter months. If the home shows well during the cold,
buyers are confident that it will be beautiful in warm weather.
Add in the romance and sentimentality of the holidays, and you have a recipe
for a sale.
"Tastefully decorated, the holiday season makes a home feel warm and nice,"
notes Irving." There"s a different aroma and a different feel to this time of
year. Gingerbread in the oven, a fire in the fireplace and extra outside lights
are all appealing. Prospective buyers make a connection by envisioning their
family at happy gatherings."
Homes do sell during the holidays.