The weather and the climate impact every aspect of human life. They also affect the ways people sell and buy their homes throughout the year. The most important factor is the seasons. They have the greatest impact on house purchases and home sales, but climate change and extreme weather events also have their role to play.
The National Association of Realtors (NAR) has been studying seasonality since 1999 and has found interesting results. Here is what you need to know about how the weather impacts the real estate market.
Summer Is the Busiest Season
According to the research by the NAR, house sales and house prices are highest in July and lowest in January. This trend repeats year after year. Prices have also been rising since the 2008 economic downturn.
In the Northeast and the Midwest, home buyers are most active in the summer months, because moving in winter is not very popular. Sales during the winter months are, on average, 60% of the sales in peak season. In areas less affected by winter weather, such as the West Coast, the slow season activity is on average 70% of the peak season.
Another element that might encourage people to move more in the summer is the school year. Parents are less likely to want to uproot their children in the middle of the school year. They prefer to wait until school is over to move house. According to MovingLabour, the busiest day of the year for moves is July 31st, with the peak moving season between May and September.
Climate Change and Extreme Weather Are Changing Real Estate Patterns
Climate change and extreme weather patterns also have a big effect on the market. After the Texas winter storm in 2021, real estate agents had a lot to deal with. They had to inspect their clients' homes, deal with insurance claims, and delay pending sales due to potential damage.
The United Nations Framework Convention on Climate Change suggests that climate change is fueling more extreme weather year after year. This would affect the real estate market in new and unexpected ways.
Take Florida, for example. As the state sees rising sea levels and more extreme storms and hurricanes, home sales and home prices have been dropping in Florida since 2013. This has also fueled a housing crisis. as nobody wants to build new homes to replace those destroyed by climate disasters. This has affected low-lying coastal areas, but the climate has affected the whole state by reducing prices everywhere.
California's intense forest fire seasons in the last few years have had the opposite effect on prices and sales. House prices in the Sierra Nevada tend to increase after a fire season because the stock of available homes is lower. This means that if the current climate trend continues, it will become more and more expensive to buy a home in California. Rising prices are a wonderful opportunity for real estate agents.
There is also the issue of homeownership and home insurance costs. With climate change, homeownership in disaster-prone areas will become more and more expensive, due to increased risks of damage from weather events. Some areas that are most at risk from climate change disruptions include Santa Ana, CA, Hialeah, FL, and Paterson, NJ.
Challenging Times for Real Estate Agents
As you can see, climate change offers challenges and opportunities for real estate agents. Earn your license with our real estate agent courses and take advantage of these opportunities in no time.