Summer house prices just as good as spring, new analysis shows

Is putting your home up for sale over the holidays a bad idea?

It's traditionally thought to be the dead zone for the housing market, when buyers and agents are at the beach and not concerned with open homes.

However, the summer holidays could be a good time to sell, with new research showing strong sale prices in December and January.

Analysis of the housing market by OneRoof and property analysts Valocity shows that the smaller pool of buyers available in the summer holidays does not have any negative impact on prices.

Valocity director of valuation and innovation James Wilson says: "While the figures suggest that buyers are less active during December and January, the fact that sales prices are holding indicates that the major factors determining price are constrained supply, strong demand and historically low interest rates."

OneRoof and Valocity analysed sales figures for the five years to 2017 to determine what impact "the holiday exodus" had on the housing market.

Sales volumes and median sales prices were analysed for the three months leading up to the holiday period (September, October and November) and the three months covering the holiday period December, January and February).

The figures show that for each of the five years examined sales volumes were down during the three months of the holiday period compared to the three months leading up to the holidays. Much of this was driven by the concurrent fall in listing volumes during the holiday period.

However, despite the drop in sales and listings there was no significant change to median sales price between the two periods.

"Given that the housing market has started to plateau in many of New Zealand's main urban centres, it will be interesting to see if the same trends hold true throughout the summer of 2018/19," Wilson said.

OneRoof editor Owen Vaughan added: "Buyers and sellers have traditionally avoided the market during the height of summer because they are either away on holiday themselves or the holiday shutdown period prevents them from easily accessing legal and financial advice and building reports.

"However, the figures show that vendors who decide to list their home over the summer period do not suffer in terms of price. In fact, less competition and a dedicated pool of buyers with possibly more free time on their hands could work to the advantage of vendors with well-presented properties."

OneRoof and Valocity also looked at whether some price bands were impacted by the summer drop more than others.

Wilson said: "Overall, there was clear drop in sales activity between the two periods evident across all price brackets.

"We do note that one of the largest drops in sales volumes occurred in 2016 within the upper price brackets. This may be the result of the market hitting its peak in the mid to late part of the year, and then taking a 'breather' throughout the summer and into the election year."

This story was originally published here

OneRoofJustin Flitter