Trying to time the market when selling can be like trying to hit a moving target while riding a horse. Not sure if you’ve tried it, but it’s difficult! Instead of trying to time it perfectly, there are a few key indicators that will help you know whether the time is right.
“Supply and demand” are critical indicators.
This business term has been around a long time, yet it still rings true. Low housing supply and strong demand are hallmark signs of bidding wars and record selling prices. To use supply and demand to your advantage, it’s critical that you monitor listing inventory closely. Ideally, you want to place your home on the market when there are fewer homes available in your area and price range. Unfortunately, though, even after careful planning, another listing can come to market and undercut your efforts.
Changes in interest rates or other government initiatives.
These can be good or bad for sellers, and often no one sees them coming. If interest rates drop, or if the government announces changes that will help buyers, this will cause higher prices and better offers for sellers. The opposite can also be true when banks and governments work to “cool” the market. In March 2017, the Ontario Provincial Government announced that they would implement a foreign buyer tax of 15% for all buyers who are not residents of Ontario. A similar tax previously implemented in British Columbia caused a sharp decline in housing prices. When it took effect in Ontario on April 21st, 2017, house prices declined, as did home sales. Another change in policy was announced in October, 2017, that would be applied beginning January 1st, 2018. A new “stress test” would limit a buyer’s ability to afford a more expensive home. As a result, prices and sales dropped substantially.
Yearly events that draw people’s attention away.
A couple of scenarios come to mind where your ideal buyer may be pre-occupied.
- Kids out of school for the summer (end of June) and going back to school (end of August / first week of September). These times may have zero impact if you’re selling a 1-bedroom condo or multi-family investment property, but if you’re selling a home in a neighbourhood for young families, it might not be the best time.
- Christmas Holidays. There are many holidays throughout the year, but nothing occupies people’s time like Christmas. This time of distraction lasts from mid-December to the first week of January.
Aside from annual events and government policies, there are other scenarios that make it nearly impossible to time the market with certainty. Situations like COVID -19, for example, can have a massive impact on your plans to sell. Our suggestion is to contact your Real Estate professionals and have them advise you based on your needs and plans.