Get ready for the spring real estate market

Get ready for the spring real estate market

Traditionally spring is the time of year when many people put their homes on the market, and buyers come out to see what is available.  There are many reasons for this.  The holidays are over, the air is warmer and landscapes are alive with blooming plants and trees.  Children are still in school in the spring so families are at home, unlike the summer months when many people are on vacation.

Spring is also a great time for outdoor projects like repairing and staining decks or cleaning out the garage, all necessary tasks for getting a house ready to sell.  With the warmer weather gardeners are out putting down fresh mulch, trimming hedges, putting in bedding plants and making their yard look its best.

Not only does spring present a pleasant opportunity to be out and around, it is also a good time for families to find their next home.  A spring purchase means a June or July closing, and that gives them plenty of time to get settled into their new home before school starts.

If you are planning to buy or sell a home this spring, now is the time to get started.  Sellers should spruce up their homes, while buyers should talk to a lender about qualifying for a loan and determine the type of home and neighborhood that best suits their needs and their budget.  Both parties should call their REALTOR® to advise them on how to best take advantage of this special time of year.

Why Spring is a Good Time for Real Estate

“It’s the most beautiful time of year,” said Bob Headrick with Nest Realty, “and historically it is the time when most people are in the market.  It’s also the time when property looks its best.”  Of course with more homes on the market during the spring, buyers have many more options to choose from.

The school year is another factor that drives the real estate market.  Headrick explained that families with children like to be out looking in the spring so they can close and get into their new home before the school year starts.  Moving in the summer also gives their children time to make friends prior to the first day of school.

“First time buyers and empty nesters are less spring market driven,” Headrick continued.  However he explained that they may still choose to look during this time of year because with more homes on the market they have more options.

“A lot of purchases are tied to the school year,” said Inessa Telefus with Loring Woodriff Real Estate Associates.  “Parents often don’t want to move their kids in the middle of the year,” she continued.  Also, many people don’t enjoy getting out in rain, snow and cold so unless it is urgent to move sooner, most people will wait until spring to sell their home or look for their next one. Of course enjoying the flowers and dogwoods that bloom in the spring makes house hunting that much more pleasant.

This year’s lack of snow and ice may be encouraging people to get out sooner.  Although the spring market typically begins in March, Telefus said that it seems to be starting earlier this year.

Headrick agrees that the market is busy now, and that the activity is due in part to this year’s lack of significant snow or rain.  However, he expressed concern over the lack of inventory since many of the spring sellers have yet to get their homes on the market.

Michael Guthrie, Principal Broker and CEO of Roy Wheeler Realty Co., described the current market as active.  “The last 11 days of January the pace picked up a lot,” he said.  His company had a home buyer seminar at the end of January and all of the participants were very pleased at the interest and the turn out.  He added that “the holidays are over and people are ready to do the next thing, like put their house on the market. Also spring is a time when fewer people are on vacation and kids sports have not started so there is extra time to do things like look for a new home.”

The tax year may also have an impact on spring real estate sales.  It’s not uncommon, Guthrie said, for first time buyers to look at the taxes they are paying and decide, “Maybe it’s time to buy a house for the deductions.”  Of course, these same buyers may also have a tax refund to look forward to which they can put towards a down payment.

From an agent’s perspective, the spring market is a time when they see a goodly percentage of their total sales.  “It’s usually quiet in the summer with people on vacation, then we see a bump in the fall until things slow in the winter,” Headrick said.  He offered statistics for last year that showed that a third of closed sales happened during just three months, May, June and July.  Since it usually takes between 45 and 60 days to go from a signed contract to closing, many of the May closings reflect the activity of buyers and sellers out in March at the traditional start of the spring market.

There are some other factors which are driving sales this spring.  Interest rates are still very low, and while prices haven’t gone up fears that they are about to do so may bring out more buyers.  “Buyers are recognizing it is a good time to make a purchase,” Telefus said.  She is anticipating multiple offers as the market heats up.

Prepare Early for the Spring Market

All the agents agree it is critical to prepare your house to look its best before putting it on the market.

Headrick advises sellers to start getting ready as early as possible.  “If someone has been living in the same house for thirty five years, they may need to start a year in advance of listing it, and no later than the previous fall.”    He explained that sellers need to be prepared to clear out, put excess stuff in storage, paint and repair.  He also recommends a pre-inspection to uncover any repairs that the seller may not be aware of.  The buyer will get their own inspection of course, but a pre-inspection allows the seller to take care of any outstanding issues when they don’t have the pressure of completing the project prior to an upcoming closing.

When the house is cleaned up and staged, it is common for agents to have a professional take photos.  In addition, depending on the price of the house, they may also utilize professionally done floor plans, Headrick explained.  “Many of our buyers don’t live locally and they can’t drive by the house.”   For that reason good photos and detailed information about the layout and dimensions of rooms are critical.

Guthrie described spring as a time when there is a lot more competition from other sellers, part of the reason it is important to get your house looking its very best.  However, another source of competition is new homes.  “Builders are feeling confident and there are new homes being built, and many new communities,” he said.  While some buyers are willing to wait for the advantages of being a home’s first owner, others don’t have the 4 to 6 months it takes for new construction.  Guthrie advises that sellers who want to appeal to these buyers need to have their home in the best possible shape.

Some sellers aren’t inclined to make required repairs, even something obvious like a broken seal on thermal-pane windows that makes them very cloudy, Guthrie explained.  However, invariably buyers will have an inflated view of what it will cost them to do the work.  This could mean they don’t make an offer at all or will make a low offer based on their evaluation of repair costs.

“Your house needs to show perfectly,” Telefus said stressing the importance of spending the time and money it takes to get it that way.  She also emphasized the importance of curb appeal, which means well maintained landscaping and exterior maintenance as well as the importance of “preparing every showing.”

The good news is, in most cases “homes that are nicely staged and appropriately priced sell quickly,” Headrick said.

Buyer Preparation

Serious buyers also need to prepare for their role in the spring market.

An important first step is to talk to a lender and determine if they qualify for a loan and if so how much house they can afford.  The lender will then generate a letter stating what they qualify for.  Headrick explained that when the buyers decide to make an offer on a house, some lenders will create a specific letter for that address.  Either way, the agent can use the letter as part of the negotiation, offering assurance to the seller and their agent that the buyer is a solid prospect.

Buyers also need to do homework on the area as a whole, on specific communities and on the type of house that will suit them best.  If privacy is highly valued, for example, they may want to find a home in the country surrounded by a few acres.  If they want to walk downtown, they need to check out close in communities like Belmont or The Woods at Burnet Commons.

Buyers coming from out of town need to adjust their expectations to our local situation.  Headrick explained that part of his job when working with these buyers is to educate them on our region and the benefit of all the different areas within it so they can focus on what will best suit them.  He added that the out-of-towners are often surprised when they discover that there are only 3 or 4 homes to look at rather than a long list of 10 or more which is more typical in a large city. If he is working with families that have children he also refers them to resources for researching the local schools.

“Buyers also need to find the right agent,” Telefus said, which means in part finding someone they trust. She described the current market as one which is “strong and fast” which means if buyers are indecisive they can lose out.  Therefore it is important to work with an agent they trust enough so that they move forward on an offer quickly when their REALTOR® advises them to do so.

Whether you are a buyer or a seller spring is a great time to be in the real estate market.  Not only is it beautiful and a wonderful time to be out, but buyers have many more options to choose from and sellers can look forward to many more showings if their house is priced appropriately and looks its best.

Celeste Smucker is a writer, blogger and author who lives near Charlottesville.