Question #2: How Many Months Between October and March?*
The answer to “how long should the listing be?” is easy: long enough to sell the house (duh!).
But that just begs the underlying question: how long will that take?
Practically, the listing contract needs to be long enough to properly prep the home for market (see below); find a Buyer; negotiate the Purchase Agreement; allow time for the Buyer’s Inspection (about 2 weeks); then add 6-8 weeks for appraisal, title work, and moving arrangements before closing (faster if it’s a cash deal).
And ideally, add a safety margin of at least one month.
Key Variables
The key variable in the above list is actual time on the market — that is, to attract a Buyer.
While no one — not even veteran Realtors — can predict how long a given home will take to sell, here are the relevant variables:
Price point. The higher the list price, the longer the average market time.
So, at least in the Twin Cities, the average $200k home should take about 2-3 months to sell; around $500k, 4-5 months; and above $1 million, six months or longer.
Which makes sense: as the price climbs, the number of prospective Buyers shrinks — and market time lengthens (which is why more unique homes also take longer to sell: smaller pool of prospective Buyers).
It’s also worth noting that the above timelines are averages; anecdotally, it seems like many homes sell right away (first couple weeks), or, seemingly take forever.
Or at least, it feels that way to the owner.
Which leads to . . .
Prevailing Market Conditions: “Your Mileage May Vary”
Some markets are “faster” than others.
When the economy is strong, consumers are confident, and interest rates are low, homes seem to sell faster.
The last two Springs in the Twin Cities certainly seemed to be fast-moving markets.
Go back 4-5 years, post-Crash . . . not so much.
Seasonality (“Timing is Everything”)
Independent of the economy — especially in the Twin Cities — is time of year.
So, in the Twin Cities, there’s an inexorable slow-down as the Holidays approach, which is compounded by the arrival of colder temps.
Sometime in late January, everyone seems to have acclimated (or gotten cabin fever), and the market predictably picks up again.
While there are technically *six months between October and March, if you subtract mid-November to mid-January — at least in Minnesota — there are really only four months of good market time during that interval.
I encourage Sellers to take that into account listing their home in the Fall.
Home-Specific Factors
Last but certainly not least on the list of variables affecting market time are the things that the Seller (and especially their agent!) can actually control.
Like:
–How well-staged is the home?
–Is everything in good working order?
–How well and aggressively is the Realtor marketing the home? (includes everything from professional photography to agent networking to flattering marketing materials and verbiage).
–Does the chosen list price reflect the home’s condition and appeal, and position it well against competing homes?
In my experience, just as the decision to buy is often emotional, so is the decision to sell.
A good Realtor will inject objectivity into the process — and ask for enough time to get the Seller the highest possible price.
P.S.: Wanna guess what my answer is to, “how long should the Buyer Rep(resentation) contract be?” 🙂
