Irvine, Ca based RealtyTrac recently took a big-data approach to analyzing over 32 million single family home and condo sales in the U.S. over the past 15 years. RealtyTrac compared average sale prices to average estimated market value at the time of sale to determine whether buyers paid a premium or bought at a discount.
Based on the closing date of the sale, RealtyTrac broke down the data by month, weekday and day of the year to identify when buyers historically have realized the biggest discounts. Below are high-level findings of their big data analysis.
The best month to close on the purchase of a home is October
Out of 2.7 million single family home and condo sales over the last 15 years that closed in October, buyers realized an average discount of 2.6 percent below full estimated market value at the time of sale.
Following October as best months to buy were February, July, December and January -- all fall or winter months except for July, which was a surprise given that conventional wisdom would suggest that is a good time to sell but not necessarily to buy to buy at a bargain price.
The worst month of the year to close on the purchase of a home is April, when buyers over the last 15 years have purchased at an average premium of 1.2 percent above estimated market value at the time of sale.
The best weekday to close on the purchase of a home is Monday
Out of 5.5 million single family home and condo sales over the last 15 years that closed on a Monday, buyers realized an average discount of 2.3 percent below full estimated market value at the time of sale.
Friday is the second-best weekday to close on a home purchase. Buyers who closed on Friday realized an average discount of 2.0 percent.
Thursday is the worst day of the week to buy a home, with a 1.0 percent average discount, followed by Wednesday with a 1.4 percent average discount, and Tuesday, with a 1.9 percent average discount.
The best single day of the year to close on the purchase of a home is October 8th
After removing perennial holidays such as Christmas Day, New Year's Day, Veteran's Day and July 4, our analysis found that over the past 15 years buyers who closed on the purchase of a home on Oct. 8 have realized the biggest average discount -- 10.8 percent below estimated market value at time of sale -- among any of the remaining 356 days in the year.
After Oct. 8, the best days of the year to close on a purchase of a home were Nov. 26 (10.1 percent discount), Dec. 31 (9.7 percent discount), Oct. 22 (9.6 percent discount), and Oct. 15 (9.1 percent discount).
The worst day of the year to close on a purchase of a home was Jan. 19, when buyers paid an average 9.6 percent premium above estimated market value at time of sale, followed by Feb. 16 (9.5 percent premium), Apr. 20 (9.5 percent premium), Apr. 6 (8.4 percent premium), and Apr. 27 (8.2 percent premium).
According to CoreLogic's latest Home Price Index for January 2017, U.S. home prices are up both year over year and month over month. Home prices nationwide, including distressed sales, increased year over year by 6.9 percent in January 2017 compared with January 2016
According to the National Association of Realtors, insufficient supply levels led to a lull in contract activity in the Midwest and West, which dragged down pending home sales in January 2017 to their lowest level in a year.