This doesn’t mean you can’t sell your house during the off-season in San Diego. If you position your house for success, you can find a buyer any time of year.
In winter, you typically see decreased activity in a four-season climate like the Northeast than you would in spring and early summer. However, buyers looking during the holidays tend to be serious and are ready and able to make an offer.
Who exactly are holiday buyers?
Buyers during the winter months are willing to take time out from holiday festivities and face icy roads, muddy walkways, and inclement weather to find that perfect home. The following buyers are likely who you’ll meet at showings around the holidays.
Buyers experiencing major life events
Important life events cause people to move at all times of the year, says Ruiz. Life events that spur buying or selling could be divorce, job relocation, or loss of a loved one. Other reasons include:
Millennials and single women
Two demographics of people that Ruiz has come across lately are millennials and single women. Statistics show there are more millennials than baby boomers, so that’s not unusual. “Millennials are starting to put their footprint on the market of homeownership, which is expected and well-celebrated,” says Ruiz. He’s seen all types of millennials, including childless couples and millennials with families.
But a factor in the market that wasn’t as expected, says Ruiz, is the purchase of homes by single women. “We’ve seen a rise in homeownership by single women.”
Buyers who want year-end tax breaks
Buyers who purchase a home by the year’s end can take advantage of 13 tax breaks. This makes buying a home during the holidays a sound financial decision. Tax incentives for winter home buyers include deductions and credits, including but not limited to the following:
- Mortgage interest deductions: Buyers who are married filers can deduct a mortgage interest deduction of up to $750,000. Single filers, or married couples who file separately, may deduct up to $375,000 off the interest of a new home purchase.
- Real estate tax: The IRS allows most homeowners to deduct their property taxes for the year.
- Mortgage points deduction: Buyers can deduct their mortgage points in the year that they’re paid.
- Home improvement tax credit: When a buyer takes out a Home Equity Line of Credit (HELOC), they can deduct the interest. However, the home improvements must add value to the home or be medically necessary to qualify for the credit.
Buyers who lost bidding wars in a hot market
Another type of buyer we’re seeing in winter is buyers who couldn’t compete in the post-pandemic housing boom. This buyer got pushed out of the bidding wars — perhaps because they didn’t have the capital for escalation clauses, appraisal gaps, or have the cash to compete with multiple offers.
“Those buyers who were at the back of the line before still want to be homeowners,” says Ruiz. “People who have been planning and saving for a long time don’t want to hesitate.”
Types of homes that sell well during winter (and those that don’t)
Detached single-family homes continue to be the type of home that sold the most going into winter at 79%, followed by townhouses or row houses at 8%, according to a November 2023 report by the National Association of Realtors. The report concluded that 87% of buyers purchased pre-owned homes while only 13% purchased new construction.
Consider waiting until the spring to sell your second home
During winter, you see a slow down with second home purchases such as vacation residences, says Ruiz. “This is the time that people are enjoying them; they travel to their beach houses and mountain cabins, so in winter, you don’t see a lot of those destination houses go on the market, ” says Ruiz. “Those tend to slow down during the winter and during the summer when they’re being utilized.”
Holiday pricing strategies
Selling your home during the holidays requires a strategic approach to pricing. This time of year can be less competitive, with fewer homes on the market, but also sees a smaller pool of potential buyers.
How you price your home any time of year will always depend on how other homes are selling on the market, says Ruiz.
The key is to strike a balance that reflects the seasonal market dynamics without undervaluing your property.
Understand the current market: During the holidays, markets can shift, and it’s important to adapt your strategy accordingly. A knowledgeable real estate agent can provide a comparative market analysis (CMA) that takes into account recent sales of similar properties in your area.
Set a realistic price: Buyers available during this time are often serious and may be looking for a quick transaction. Setting a realistic, competitive price can attract these motivated buyers. Overpricing in the hope of haggling down can deter potential interest in an already limited buyer pool.
Consider seasonal adjustments: In some markets, home prices can soften during the winter months. Be prepared to make seasonal adjustments to your pricing strategy. This doesn’t mean a significant drop in your asking price but rather a realistic acknowledgment of the season’s impact on buyer behavior.
Highlight holiday appeal: If your home has features that shine during the holiday season, like an inviting fireplace, ample space for entertaining, or energy-efficient heating systems, make sure these are highlighted in your listing. These features can justify a stronger price point by enhancing the home’s appeal.
Be prepared to negotiate: The holiday season can bring out more serious negotiations. Buyers may expect a holiday deal, so be prepared to engage in some back-and-forth. However, know your limits and have a clear bottom line defined with your agent.
