While this COVID-19 positive year has certainly been
an exception, spring is usually considered the optimum time, on both sides of
the transaction, to buy or sell a home. A new study, by ATTOM Data Solutions,
indicates that one side of the equation could be losing money. Indeed, the
company says, “Buyers
willing to close in December and January avoid prices well above market value.”
The company looked at any calendar
day over the period of 2013 to 2019 where there were 10,000 single-family or
condo transactions and found 362 days that matched that criteria with the
exceptions being all holidays – January 1, July 4, November 11, and December
25. They then compared the median sales prices of homes that closed on that day
with the automated valuation model (AVM) for those same homes at the time of
sale. There were more than 27 million single-family home and condo sales
included in the seven-year analysis.
According to ATTOM, buyers who close
on December 4th or January 26th will get the best deal
and pay exactly market value for a property, as opposed to above market value
in an extremely competitive market that has seem prices rapidly moving higher.
The best day was December 4. The
close to 90,000 homes that sold on that day had a median sales price of
$202,000, precisely the median AVM. The same ratio was true for January 26, with
the median of $185,000 only $64 more than the median, still a 0 percent premium.
The other two “best days” were December 6 and December 26, both of which had
sales prices only 0.5 percent higher than the AVM.
December was considered the best
month to buy on a national basis, with a 1.5 percent premium over AVM for the entire
month, but November wasn’t bad either. The premium for the month was 2.0
percent and two days, November 2 and November 19 also had 0.5 percent premiums.
The January premium was 2.5 percent and by February the spring market appears
to be looming. The premium that month was 3.4 percent. The month of June had
the highest premium at 6.9 percent.