Cycles are all around us. The most recognizable cycle (besides the one your boss goes through) is the one through spring, summer, fall and winter during our journey around the sun; a 587.25 million mile trip. A more noticeable cycle in New Hampshire, less in California but that's why most of us live in California isn't it? The moon runs through a long, ever changing routine and when the routine is complete, it starts all over again. The oceans' tidal cycles are old news, in, out, high, low, we know what they will be. People count on what they will be.
The economies of the world go through cycles. The U.S. has experienced many years of strong growth followed by just as many years of slow growth, no growth and even negative growth. Negative growth, sounds like a contradiction in terms. Oh well, you know, good times, bad times.
The real estate market goes through cycles too. There are long term cycles which pretty much run in sync with the economy of the nation and short run cycles which fluctuate seasonally. We are going to look historically at the short run cycle in our community and try to anticipate what the future will bring.
The graph is a total, by month, of all the sales reported through the North County Multiple Listing Service, on all properties sold during the years 1986 through 1997. Note the selling cycle as illustrated by the solid curved line. It shows us that we are at a low point in the cycle as we come out of the holiday season and enter the new year. Then we quickly climb to the peak period right near mid year, usually experience a strong third quarter, then steadily fall off through the end of the year. That's a pretty good representation of the real estate selling cycle here in the North County.
We need to understand that the numbers are a representation of the sale date, the date the sale was final, escrow closed and the transfer recorded. The average escrow period is about 58 days. So if we move back 58 days from the prime selling period, we see that the ideal time to be on the market is in February/March/April. That is the time in which we have the greatest probability of receiving an acceptable offer to purchase and closing about 2 months later. So, based on all of these market averages, if you are thinking about selling, you want to have your house on the market during the peak period when the majority of acceptable offers are generated.
Of course, these are all just averages. The important fact here is that the peak selling activity happens early in the year. This is when you are most likely to receive an acceptable offer on your property, so be prepared, plan ahead. If you plan to paint and dress it up, have the project completed in January or February.If you miss the prime selling season, you still have a good chance at selling, but the best time is spring time.
*Note: This representation is based in whole or in part on data supplied by the Paso Robles Board of Realtors or its MLS. Although the data is deemed reliable, it is not guaranteed. Data maintained by the Board or its MLS may not reflect all real estate activity in the market.
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