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What is the real estate cycle and when is a good time to buy?

Updated: Jun 17, 2020

Spring is upon us, which means that in most parts of the country, we are experiencing an annual phenomena called the annual spring buying season. It’s important for buyers and sellers to understand how this real estate cycle affects the overall value of their property.

This cycle is more prominent in markets which are impacted by seasonal changes. For markets that have little variation in the weather (California or Florida, for instance), the real estate cycle is not as pronounced. In Canada, and especially in Alberta, the real estate cycle is very clearly defined. It is common to see slow sales during the winter months when no one wants to be outside. This is because buyers and sellers prefer moving in the spring and summer months to avoid the cold temperatures. Moving boxes in the dead of winter is never a fun idea.

During the spring and summer months, sales pick back up and the real estate cycle is at its peak.

Pros and Cons of Buying in the Spring Cycle

Sellers understand that there are more buyers available in the spring market, which means that many sellers will opt to list their property during this time. More supply of buyers means there is a better chance their property will be sold more quickly. Houses also show better in the spring season because they can be dressed up with flowers and nice lawns.

Buyers are happy to view houses in the spring. In addition to the weather being nicer, there is more choice of housing stock to look at, which can make the search process better. This is only an advantage in a market downturn because when properties are in demand, buyers will often find themselves in a bidding war. This is why buying in the spring cycle is typically more of an advantage for the seller.

Planning Ahead is Vital

As a homebuyer, understanding the annual real estate cycle will give you an advantage when you are thinking of selling or buying your home. Don’t get caught up in the spring buying rush. If you can hold out until the winter season, there can often be better deals found. Buying property in the winter means that you are up against less competition from other buyers. Furthermore, sellers who opt to list their properties during this time might be in a rush and might be willing to negotiate.

Julius Tang


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