Nov. 10 (UPI) -- If you're looking for a real estate steal, you better hope it rains on auction day. Sunshine tends to encourage higher bids at auctions, according to a new study of home sale prices in Australia.
"Weather is known to affect mood, and some studies have shown a link between the weather and stock prices, so we decided to look at weather and house prices," Adrian Lee, finance lecturer at the University of Technology Sydney, said in a news release.
Lee and his research partner Maggie Hu, finance professor at the Chinese University of Hong Kong, compiled the selling price of homes sold both privately and at auction in Sydney, Australia, between 2000 and 2014. They compared sales prices with daily measurements collected by the Bureau of Meteorology, including temperature, rainfall and solar exposure. Consumer sentiment survey data provided their analysis further context.
Their findings showed sunny days boosted the winning bid of homes sold at auction by 0.974 percent, nearly $11,500 based on the median sale price of a house in Sydney.
"There is a link between sentiment, or mood, as measured by consumer sentiment surveys, and asset prices -- including house prices," Lee said.
Warmer days had a similar effect on prices. Ten degrees of warmth translated to a 0.635 percent larger winning bid.
For bargain hunters, rainy days are when to shop. Homes sold at auction went for 0.174 percent less when it rained -- a savings of $2,050. Long weekends and holidays are other good times for bidders looking for a lower price.
"Houses are not priced rationally," Lee said. "The price is partly driven by people's feelings, particularly at auctions. So if you are buying or selling a house, it is good to be aware of these influences."
Private home sales were impacted by the weather.
Lee and Hu are scheduled to present their research at American Real Estate and Urban Economics Association Conference, being held in Philadelphia in January 2018.