I pulled data of all single family home transactions from 2007 - 2014 in these four counties - Dekalb, Cobb, Fulton, Gwinnett, which forms the core of Atlanta Metro. The data has about 300,000 records, and the fields used are Price, Closing Date and County. I grouped Period by Quarter . Then I grouped them by Quarter and County, and used MEDIAN price as a price indicator.
Here are some plots I made based on data, showing home price trend from 2007 - 2014
The first plot shows quarterly median sales price. Beginning of 2007 should be close to the peak of the market before the recession. So by the end of 2014, the market overall is pretty much recovered from the loss. The median price for the whole area is about 200k, which I think is very affordable compared to many other large metro areas.
The second plot shows Quarterly Returns (similar to daily returns in class). It does suggest real estate market is very very seasonal. It also shows some counties are much more volatile compared with others. So I also calculated average standard deviation values.
The third plot is cumulative returns. Looks like Dekalb County lost more than 60% in home price by end of 2011, but now is well above its starting point, while Gwinnett County is still below.
To show price change is seasonal, I made another plot showing Average Price Change by month.
Looks like average monthly returns are positive for Feb to June and also December, while negative for others. It is interesting the patterns seem to stand in both bad market and good market.
The first reason I can think of is school, since most families want to settle before the new school year start, which can also partly explain the positive return on December (Holidays may be another reason). Weather can be a factor too.
So the best months to sell a house may be March, April, May, and June. But I used the closing date as index so there is a lag for sure. In a hot market, you need about a month to put your property from listing to contract in general, and about another month from contract to closing, if everything goes well. So I think if I am selling, I will get everything ready after New Year. The windows is like January to May.
@Zach Liu Thank you for sharing this in depth analysis! Very insightful and informative.
@Pyrrha Rivers Glad you like it, I need to do some more detailed analysis when I get time.