Real estate sales are very seasonal – we have the spring and fall markets, winter can be slow and then there are the summer doldrums. In fact sales from the slowest to highest month can vary by 250% in a single year. That’s why market watchers always compare sales in any one month to the sales of the same month a year ago. But you need to analyze more than just that.
In reviewing the 2012 condo market, sales were strong for the first four months, stalled, and then recorded month over month sales declines of 20-30% every month over the last half of the year as compared to 2011. For the first four months of 2013, condo sales will still be lower than for the same month in 2012. Most experts will come to the conclusion that the market is still going down! But the true test is to track the monthly sales differential. Is the decline less than 20%? Is the percentage difference shrinking each month? By August of this year, monthly sales will again be running ahead of 2012 and then the media will get on the band wagon and tout a market rebound. But the turnaround will have started much sooner. And buyers who wait until then will have missed their market chance.
The first test of a market turnaround will come with the January sales results. Two things to look for: are January sales higher than December? When you look at 2012, January sales were actually lower than December of 2011. Secondly, what is the percentage difference between January of 2013 versus January of 2012?
Last year we had a mild winter and the spring market arrived early – it started at the end of January. This year the weather was again mild for the first half but has turned decidedly snowier and colder. What we do know about buyers is that they will postpone viewings and will postpone offers, depending on the weather. So that too will impact January sales in 2013.
Our 2013 Market Forecast called for the current MARKET PAUSE NOT CORRECTION to end by March. The signals should be apparent by then for those who truly analyze the market.