You Can't Time the Real Estate Market
One of the most common questions I get from both Buyers and Sellers is "when is the best time to "buy/sell?".
While other parts of the country may have more of a seasonal fluctuation, in the South Bay Beach Cities Real Estate is pretty much year round. In fact, over the past five years December has been mu busiest month in all but one. That probably wouldn't be the case if I were selling in Brooklyn New York.
So while you might see more listing during the traditional Spring Selling Season, there is also more competition. And, top to bottom, even at a 20% differential in number of listings from the busiest to the slowest month, we're talking about a net difference of around 6-8 available units.
Here's what I would do if I were considering Buying or Selling.
As a seller, if I made the decision that I was definitely selling I would get the property on the market as soon as possible after I made any necessary repairs or updates and had the time to declutter and prepare.
If I wanted to buy a home in Redondo Beach I would get a solid pre-approval and start looking but not feel pressured to make an offer until I found the right home. (Not the perfect one which just doesn't exist.)
Here's why you are well served in following this advice.....
Don't Assume the Current Market Conditions Will Continue Indefinitely
This is probably the biggest mistake Buyers and Sellers historically make. Unlike the stock market (which you also really can't time), in Real Estate the trend is not your friend.
If I roll back the clock to the worst day of the foreclosure - short sale era, I literally had Buyers very confidently telling me they thought the market was going down another 30%. That would be on top of the 20%+ declines we already experienced on some properties. No matter what they read on the various doom and gloom websites that just wasn't going to happen simply because there were too many remaining home owners who had too much equity to bail. I came to that conclusion after extensive analysis and as it turns out I was pretty accurate. So in that time period, prices were not going to keep declining indefinitely.
And today, prices aren't going to keep appreciating forever. At least at the current pace.
If you a home owner thinking of selling, there is no guarantee that your home will be worth more next year. While I think prices will continue their upward trend, the pace has already slowed somewhat from about a year ago. In fact, if interest rates spike up, you may not be able to sell for any more than today. If you will be buying another property in Southern CA, the increase in interest rates may impact you more than the benefit of any price appreciation.
As a Buyer, you have to realize that we have been in a very low interest rate environment for quite a while and this will not continue indefinitely either. After the elections last November, we saw some of the most rapid mortgage rate increases ever. While these have drifted a little lower than recent highs, the global economy and status quo is just volatile enough that we can see another spike.
Your Friends, Family, and Co-Workers Certainly Mean Well
Yes, I know they have your best interest at heart, but unless they bought or sold a similar home to yours in the same neighborhood last month or so, chances are their experience is just not that relevant.
Here's a current example.
We're representing a Buyer on a very competitive listing (competitive because it is priced at the low end for the neighborhood). His boss, who he claims is his mentor in this country recently bought a property for $2M that he knocked down and rebuilt a home worth probably close to double that.
The boss advises our Buyer client to leave the 17 day inspection contingency (RPA paragraph 14 B) at the default instead of lowering it to 10 as I always do on offers. Also told him to go for a 60 day escrow. As you can probably imagine, those terms weren't too attractive when our offer was one of 12.
While it may have made sense for someone thinking of building to negotiate for a longer inspection period, we don't need to reinvent Real Estate practice every time out. If everyone is getting offers with 10 day inspections - as is standard right now, that's what you go with. As for a 60 day escrow, that's just bad advice. The rate lock after 45 days go up and will cost the Buyer more for the same loan.
Speaking of rates.....
The Lowest Rate on the Internet Rarely Is
No lender can lock your loan rate until you have a signed purchase contract. When shopping for lenders what you want to research is a) performance b) other lender fees and c) fit for your situation meaning does the lender typically handle loans like yours. There are some loan officers who specialize in VA, FHA, self employed borrowers, super jumbo, etc. If you are not sure, ask. And please, for your sake, don't deal with anyone in a call center. You just won't get the service.
Speaking of fit......
Not All Realtors Are Created Equal
I know your friend who just got their license would love to represent you and the family relative who lives in the next county would like to list your home and there is always a discount Broker. But those are not the best way to decide who should represent you.
Whether you are Buying or Selling a home, your best choice is always the Realtor who specializes in your neighborhood, price range, property type, and situation (first time buyer, first time seller, etc.)
The reason my Redondo Beach listings sell for higher prices (see above graphic) than other agents and my Buyers get better deals is because I specialize in Redondo Beach Real Estate.