New Zillow research suggests the spring home-shopping season may see a second wave if mortgage rates fall

• A Zillow analysis of 2023 home sales finds that homes listed in the first two weeks of June sold for 2.3% more.
• The best time to list a home for sale is a month later than it was in 2019, a change likely driven by mortgage rates.
• The best time to list can be as early as the second half of February in San Francisco, and as late as the first half of July in New York and Philadelphia.

SEATTLE, March 7, 2024 /PRNewswire/ -- Spring home sellers looking to maximize their sale price may want to wait it out and list their home for sale in the first half of June. A new Zillow® analysis of 2023 sales found that homes listed in the first two weeks of June sold for 2.3% more, a $7,700 boost on a typical U.S. home.

The best time to list consistently had been early May in the years leading up to the pandemic. The shift to June suggests mortgage rates are strongly influencing demand on top of the usual seasonality that brings buyers to the market in the spring. This home-shopping season is poised to follow a similar pattern as that in 2023, with the potential for a second wave if the Federal Reserve lowers interest rates midyear or later.

The sale price premium registered last June followed the first spring in more than 15 years with mortgage rates over 6% on a 30-year fixed-rate loan. The high rates put home buyers on the back foot, and as rates continued upward through May, those prospective buyers were reassessing and less likely to bid boldly. In June, however, rates pulled back a little from 6.79% to 6.67%, which likely presented an opportunity for determined buyers heading into summer. More buyers understood their market position and could afford to transact, boosting competition and sale prices.

"The old logic was that sellers could earn a premium by listing in late spring when their home would be on the top of the pile of listings when search activity was at its peak. Now, with persistently low inventory, mortgage rate fluctuations make their own seasonality," said Zillow Chief Economist Skylar Olsen. "First-time home buyers who are on the edge of qualifying for a home loan may dip in and out of the market, depending on what's happening with rates. It is almost certain the Federal Reserve will push back any interest-rate cuts to mid-2024 at the earliest. If mortgage rates follow, that could bring another surge of buyers later this year."

Mortgage rates have been impacting affordability and sale prices since they began rising rapidly two years ago. In 2022, sellers nationwide saw the highest sale premium when they listed their home in late March, right before rates barreled past 5% and continued climbing.

Zillow's research finds the best time to list can vary widely by metropolitan area. In 2023, it was as early as the second half of February in San Francisco, and as late as the first half of July in New York. Thirty of the top 35 largest metro areas saw for-sale listings command the highest sale prices between May and early July last year.

Zillow also found a wide range in the sale price premiums associated with homes listed during those peak periods. At the hottest time of the year in San Jose, homes sold for 5.5% more, a $88,000 boost on a typical home. Meanwhile, homes in San Antonio sold for 1.9% more during that same time period.

"Most sellers don't have the luxury of timing the market. The best time to list is when it makes the most sense for their lives," said Olsen. "Regardless of the month, sellers who list their home for sale this spring can expect plenty of interest if their home is marketed and priced right. That's why it's more important than ever to hire a real estate agent with the experience to localize your strategy when comparable sales might be further afield. Harvesting near record home equity to support your next purchase or retirement is still possible."

Zillow data finds there are other unexpected ways to sell a home faster and for more money in today's market. These three tips can help:

• Screen appeal is the new curb appeal: A vast majority of buyers start their home search online. Sellers can make their listing stand out on Zillow by hiring an agent with a Listing Showcase subscription. It allows sellers to highlight their home's best features with larger, high-resolution photos, an AI-powered 3D home tour and interactive floor plan. Zillow data finds Listing Showcase listings receive 68% more page views, 66% more saves, 63% more shares and are 15% more likely to go pending in 14 days, compared to similar nearby non-Showcase listings.
  
  
• Highlight the right features: Certain home features, when mentioned in a listing description, can signal to a buyer that a home is desirable and up-to-date. As a result, those features can help a home sell faster and for more money. Mentioning a steam oven or a pizza oven in a listing description can help a home sell for as much as 5.3% more, while a mention of a doorbell camera can help a home sell five days faster.
  
  
• Make strategic improvements: Zillow research finds that most sellers make at least two improvements before listing their home for sale. Interior painting is one of the most common projects sellers take on. However, it pays to be strategic when picking paint colors. Zillow's latest paint color analysis finds homes with a charcoal gray kitchen can sell for about $2,500 more.

About Zillow Group

Zillow Group, Inc. (Nasdaq: Z and ZG) is reimagining real estate to make home a reality for more and more people. As the most visited real estate website in the United States, Zillow and its affiliates help people find and get the home they want by connecting them with digital solutions, dedicated partners and agents, and easier buying, selling, financing and renting experiences.

Zillow Group's affiliates, subsidiaries and brands include Zillow®, Zillow Premier Agent®, Zillow Home Loans℠, Trulia®, Out East®, StreetEasy®, HotPads®, ShowingTime+℠, Spruce® and Follow Up Boss®.

All marks herein are owned by MFTB Holdco, Inc., a Zillow affiliate. Zillow Home Loans, LLC is an Equal Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org). © 2023 MFTB Holdco, Inc., a Zillow affiliate.

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SOURCE Zillow Group, Inc.