Should You Buy Or Sell Property During Real Estate’s Slow Months?
Toronto is a big enough and dense enough city that there is always something for sale. But when should you sell a home? When should you buy a home?
We know the spring and fall markets tend to be the most active. There are more buyers buying and more sellers selling.
That said, I am often asked: Is there a better time of year to buy? Is there a better time of year to sell?
And I will get to the answers, but first, let’s take a bit of a guided tour of how real estate often unfolds season to season.
The spring market is a moving target.
If the weather is warmer, it may start as early as February or as late as the end of March. The busiest spring month tends to be April, though May can also be busy.
The spring market may slow down as soon as June, but sometimes trails off well into July.
Torontonians are obsessed with the weather, and that obsession carries over into real estate. And really, we can’t blame anyone who is less likely to go out and see properties when it’s 35 degrees Celsius or -35 degrees Celsius. So, if the weather is really hot, fewer people want to go out and break a sweat looking for homes.
The fall market is much more predictable.
It does not have a moving target start-date like the spring market. It starts after Labour Day. Like clockwork. September and October are its busiest months.
The end date, however, is a bit more tentative.
It may slow the last week of November or run into mid-December before slowing down. The slowest months tend to be December (particularly the second half over the holidays) and August.
December is slow for obvious reasons.
August is slow for the opposite reason.
There’s lots of heat and light. So, people take vacations. Kids go to camp. Friends hang out at the lake. Barbecues light up. Things slow down.
So the real estate market will heat up again after that first cooler September night.
Now, let me address two frequently asked questions:
1. When is the best time to buy a property in Toronto?
2. When is the best time to sell a property in Toronto?
If you start by looking at the statistics, generally the month that yields the best prices would be April. Just keep in mind that all months in a given year do perform differently. That is why those who analyze real estate statistics will often compare April of one year to April of another.
You must compare apples to apples. Comparing April to August would be like comparing apples to oranges. Because August would often have lower sales prices.
So, based on these statistics, it would appear to be a wiser decision for a seller to sell in a peppy month like April, instead of a slow-moving, lazier month like August.
But this isn’t always true.
August often carries a lot of the less coveted properties that did not sell quickly in the spring. So, the sold prices tend to be unfairly pulled lower in that month.
It’s not that August is a bad month to sell, but this month does not carry as much of the quick-selling, showcase properties of April.
In fact, sometimes I find slower months to be the good months for selling.
Take January for example …
Buyers who are keen to buy a home just went through December with few options. So, they are keen to get back out and look.
Because there is far less competition in the slower months, you may have a better chance than some of the fast-paced months. Slower months have less competition but also fewer buyers. And vice versa.
In my opinion, there is no month that is consistently better for selling a property.
If you aren’t in a rush, bringing out a listing would depend on two things: One is how the market is performing. The other is a property’s uniqueness.
In May of 2017, prices were falling. So, it was not a great time to list. In May of 2018, if you had a condo in Toronto, it would have been a good time to sell. Just like in June of 2018 or July of 2018. Because the demand was there.
But, for a very unique property that would only attract specific buyers, you may want to try a busier month.
If you don’t think the competition matters because your property is so unusual and really not in competition with any other property, then the busier months may also be a better option.
Now for the buyers, the same rules apply.
In the slower months, you have less competition for homes and fewer buyers looking. On the other hand, you also have fewer properties to see. In the busy months, you have more buyers competing against you, but you also have more property options.
If you are a buyer looking for something specific, I would be more active in the busier months of spring and fall when you are more likely to find would you want.
If you are looking for basement bargain deals, you may look at August or December. Traditionally, these months may carry listings that are stale and not selling.
Just keep in mind that these listings may also be overpriced. There’s no guarantee these months will have deals, it’s just more likely.
Again, it comes down how the market is performing. Certain months in one year may be great to buy in, but not in the following year.
I think when people ask when is the best time to buy and sell in Toronto, they are wondering if they can time the market based on the seasons of the year. And really, it is never easy to time the market. Things can change very quickly.
Still, you do need to have a very good idea of what is going on in the Toronto market to know when is the best time to dip your feet in.
Depending on how the market is performing and what you would like to sell or buy, I will always have a few informed suggestions.
Just know that my suggestions will be based more on how the market is performing, than which month of the year is “best.”