Earlier this week I talked about how May prices will probably be the peak of growth we see for the year, which naturally begged the question: What is the typical housing cycle like in Arizona?
Well normally, in January, many buyers start jumping back in the market after the holidays and we see growth in demand through May, where activity tends to peak. Then it starts slowing down, slowly from June through October and then activity comes to a screeching halt in November and December, and we don’t see many closings in January.
As you can see by the chart above, January is always the slowest month for activity every year because so few are shopping in December.
I need to clarify that, much like any economic cycle, these are general guidelines based on historic data, not a guarantee for the future. However, the higher in price you go in the market, the more it holds true. Houses that are selling for $1 million or more are much more likely to follow this pattern than houses that sell for $200,000. Although both will follow the same pattern, the extremes are more pronounced.
These cycles are why we talk about year-over-year prices and activity, as opposed to monthly. It is not fair to compare the activity for closings we see in January with the closings we see in May and June.
What does it mean for selling your house? Well, historically, the earlier in the year you can sell, the better, as there are more buyers in the market and you are likely to get multiple offers – increasing your sale price. If you are looking to buy, later in the year might be best.