We are just one week away from March 2016, the beginning of the spring real estate market. This year, Zillow predicts that the best time to list a home will be between March 20-31. This trend of listing your home between mid-March and mid-April has become commonplace. In short, the spring real estate market is the hottest for Washington, D.C.
Listing your home in the spring doesn’t necessarily mean the greatest increases in price; in fact, prices gradually increase throughout the year naturally instead of spiking in particular seasons. However, because of much more pleasant conditions from the frigid winter and a combined increase in the presence of motivated buyers in the marketplace, inventory naturally rises in the housing supply market. For buyers, this doesn’t mean that increased supply means less competition; in fact it is the opposite. D.C. is one of the biggest seller’s markets in the U.S., with a standard shortage of inventory at all times. This means that buyers must be prepared to compete for the homes they want.
If you are a homeowner who has not already started the process of selling your home, you may be a little late to the party in preparing for the spring market. For many sellers, the process of listing, preparing, showing and ultimately selling your home is a lengthy process that starts long before the home hits the MLS. Sellers who prioritize selling for the highest price will be surprised often times that simple maintenance and repair items to the home can increase its worth. For example, fresh paint, closet organization, and de-cluttering are simple projects that show off the home better to buyers. Staging for the spring is simple: neutral tones and depersonalizing your space shows buyers what their lives may look like if buying your home.
As to larger projects, trends show that buyers really like move-in quality houses. For sellers who are looking to update their homes for the spring market, kitchen and master bathroom renovations deliver the biggest rate of return. However, be sure to keep in mind the market you are selling to, as all renovations are not created equally. For example, if selling a property in the middle price range of your market, there may not be as much rate of return on your renovation investment by purchasing the highest end upgrades, appliances and finishes.
For buyers, this is the right time to be preapproved for a mortgage. As the demographics of homebuyers continue to trend locally and nationally, more and more young buyers are entering the market armed with pre-approval letters and primed to make an offer. Whereas 20 percent conventional financing was the norm for years, buyers now are taking advantage of low down payment programs with reduced or little mortgage insurance. Buyers who are on the fence about a 2016 purchase should explore their loan options now instead of waiting to test interest rates.
The spring marketplace can be one of the most competitive markets for hot property. For buyers looking to purchase soon, I recommend breaking into the market now, as competition will only increase in the next 60 days. While multiple offers are common in D.C., some buyers may prefer to explore listings that stayed on the market the past 60 plus days over the winter, as this is normally an indicator that properties have been overpriced. You never know if you can find a great deal on a property listed months ago at a higher price.
In all, this spring’s market is primed to show a steady market in the D.C. area. With more and more buyers entering the market after steady years of growth, 2016 shouldn’t come with any surprises and continue our region’s growth. With interest rates and younger buyers coming to the market, sellers should do their absolute best to prepare their home for sale.