Real estate is seasonal. Just like retail sales are expected to increase towards the holiday season, real estate trends in a reasonably predictable fashion throughout the course of any given year. Sales pick up in the early to late spring, fade off in the winter. Seasonally adjusted data aside, this is why year-over-year comparisons are preferable for determining market direction.
Real estate is also very ‘micro-seasonal’ in that there are certain days of the week that tend to have more sales than others. Generally speaking, Friday is the busiest day of the week while the weekend – specifically Sunday – is the slowest.
If you’re using a year-over-year comparison, you need to be careful to include full weeks of data since ending a year-over-year comparison on a Sunday would skew your results. (Similarly, using incomplete weekly data ending on a Friday would also skew results)
For example, using the September 1-9 figures would look like sales were trailing year-over-year.
But if we were to check what days were included in the first nine days of September in 2012 compared to last year – everything else being equal – a sales drop would be expected. Between September 1-9 in 2011 there were two Fridays and only one weekend. In 2012, the same period of nine days included two full weekends and only one Friday.
So when you’re looking at the year-over-year comparisons on my daily real estate statitistics, unless it’s a 1-7, 1-14, 1-21, 1-28 or end of month yoy comparison, you won’t really be getting an accurate market snapshot.
For the September 1-7, 2012 real estate update, with yoy comparisons, click here. Be sure to check back on the 15th for the next Calgary real estate update.