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Indianapolis, IN 46227

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The winter slow down vs. the sellers market.

It is commonly known that more homes sell in summer than winter…and the obvious answer, at least here in temperate central Indiana, is that no one wants to move in winter.

While I am not going to dispute this at all, I want to dig a little deeper into it.

My reason? Well, it has to do with two things. First, listings are low and I want to list more homes. I am finding that like most years, sellers are hesitant to list over winter. They see the winter slow down as a reduced chance to sell their home.

While there is some truth to that, there is another side to the coin. Listing volume tends to start growing around February and continue through summer. What that means is that if you are listing then, you are getting lost amongst the crowd of people who are also listing as the weather warms.

On the other hand, if you list when other inventory is lying dormant, your visibility amongst the buyers is dramatically higher.

That brings us to the economics of the current situation.

The number of listings in central Indiana is incredibly low…even for the season. As of the end of October there were 23,460 homes on market in the greater Indianapolis area market versus 30,729 same period last year. That is a 23.7% drop in a year that has seen sales volume that hasn’t been matched since 2006.

To further put that in perspective, as of October this year $5.6 Billion dollars in volume has sold this year. The same period last year was a whopping $590 Million dollars less at $5.03 Billion.

What has economics taught us about when sales are up and the inventory growth doesn’t keep up? Higher prices and quicker turnover for sellers.

In other words, we are firmly in a sellers market that should continue to grow stronger through the beginning of 2016. At that point a glut of new homes will be coming on the market (based on history and what I am hearing while making hundreds of expired listings calls).

What happens when all those new listings come on? The market balances out and everyone who didn’t list over winter misses out on what, while an anomaly, is a great opportunity for sellers to maximize their net price.

So the long and the short of this is, if you are planning on sitting out the winter and waiting until the thaw to relist your property… you may want to rethink your strategy.

Have a great day.

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