Homes that were listed for sale in the second half of May last year sold for 1.6% more — a $5,600 boost, a Zillow analysis reveals.
The real estate listing firm reports that search activity usually peaks prior to Memorial Day as families look for homes for summer vacation and the next school year in the fall. Sellers who list in late spring are entering the market when the most shoppers are looking.
However, Zillow said it’s not clear that this year’s spring home shopping will follow last year’s pattern. Inventory has remained persistently low, so volatile mortgage rates are creating their own seasonality in the housing market, the company reported.
“In the past few years, mortgage rate fluctuations upended the traditional spring home shopping season,” Zillow senior economist Orphe Divounguy said in a news release. “Buyers who are on the edge of qualifying for a loan jump in and out of the market depending on what’s happening with rates. When rates fall, more buyers rush in, putting upward pressure on prices, which could happen at any time of year.”
Ever since mortgage rates began rising rapidly in 2022, they have had a big effect on affordability and sale prices. In 2022, the highest home sale premium was seen in late March, right before rates rose above 5%. A year later, sellers got the highest prices in early June, after many buyers had sat out for months in hopes that rates would cool. Last year marked a return to pre-pandemic seasonal norms, with the highest premiums commanded in May.
But the best time to list varies widely by metropolitan area, Zillow said. In San Diego and Austin it was as early as the second half of March. In Phoenix it was late as the second half of November.
The peak-period sale price premiums also varied by metro area. In San Jose during the second half of March, sellers saw a 5.3% premium — an extra $93,200 on a typical home in that Silicon Valley city. But in Orlando, homes sold for only 0.9% more during that city’s peak period in early May.
Zillow acknowledged that most sellers can’t wait for the peak week and right month to sell. But they can still use other strategies to reach the most potential buyers, such as maximizing exposure, focusing on screen appeal and highlighting in-demand features.
Zillow said sellers should require that their agent immediately list their home on the Multiple Listing Service. Homes that are not on the MLS sell for a median of 1.5% less, a loss of nearly $5,000 for a typical seller.
Additionally, home buyers will pay up to 3.1% more for certain backyard amenities, such as an outdoor TV, a pizza oven, outdoor shower or bluestone patio.
