A Closer Look at How The Time of Year Affects Home Buying
Purchasing a home is a huge commitment. The timing of this purchase is crucial. There are positive and negative factors that affect home buying, particularly when evaluating whether to purchase your home before the end of the year, or waiting to make a purchase until the start of a new year. Ultimately, the best time comes down to your own financial readiness. But let’s take a closer look at how the time of year affects real estate, so that you can make the best home buying decision possible.
Inventory, competition, and prices are a few of the factors that can vary throughout the year in the real estate market. Like with anything, supply and demand play a large role in getting the best deal on a home. You want to have choices, but you don’t want to have to compete with everyone else. Striking a balance between two is important.
Buying a House at the End of the Year
Prices are generally less expensive at the end of the year, particularly in November and December. This is because the inventory comes from owners that must sell immediately, so they are more willing to negotiate. People selling in the midst of the holiday season usually are motivated to sell. This helps buyers cut a better deal than a home being sold later during a different time of the year.
There is significantly less competition in the housing market at the end of the year. It is much easier to house hunt during the warmer weather.
Houses that are still on the market from the fall, when house prices were at a peak, usually see price reductions as the year comes to a close.
Sellers really want to sell their property by the end of the year for income tax purposes. This makes sellers more anxious to sell and negotiate. The buyer is in an excellent bargaining position.
An advantage to buying at the end of the year is that you can take your time. In the spring when house buying is so competitive, buyers often need to make rash and quick decisions in order to secure the house of their dreams. Even having a night to sleep on the decision can result in making a more informed decision and finding the perfect home.
Buying a House at the Beginning of the Year
Waiting until the new year, January or February, can also help you pay the best price. U.S. home prices are about 8.4% lower in the first two months of the year then in the busy summer selling season.
In January, there is usually a scarcity of buyers. Temperatures are dipping and fewer people want to brave the cold temperatures to search for the perfect home. Conversely, once spring arrives, buyers will flood the market, causing house prices to go up. So shopping for a new home in January is perfect for bargain hunters.
Prices may be appealing at the start of the year, but there is less inventory. The number of homes for sale is sometimes significantly lower in January and February. Your dream home may be harder to find with a limited selection. However, sellers that are selling are likely more willing to negotiate and throw in extra perks such as appliances and window treatments.
During the first few months of the year, you will be seeing a property at its worst. Winter is when a property is subjected to the harshest conditions. As a buyer, look beyond these conditions and see the potential beauty of the home.
Despite obvious winter home search challenges that can occur from winter weather, the closing process tends to be quicker this time of year. Lenders process fewer applications and inspectors are more accessible.
So When Is the Perfect Time to Buy?
Real estate is local, so it is important to talk to your regional real estate agent about trends in your specific area. Additionally, Covid-19 shutdowns have altered the usual real estate trends.
Ultimately, the perfect time to buy a house depends on your finances, goals, and personal timeline. The real estate timeline is not definitive. The first step is to get your finances in order. This will set you up for a successful home-buying experience. You should never rush into the market at any particular time simply because you think it is the best time to buy. The perfect time to buy a home is when you are ready.
Both Real estate agents and estate lawyers play an important role in the home buying process. When they work together as a team, the client gets the best of both worlds! Boyle & Kahoe can help you purchase your home at the right price regardless of when you are ready to enter the market.
Jessica Boyle Tsottles is an experienced Realtor in Harford County, and Robert Kahoe is an experienced attorney focusing on real estate, estates and trusts. Together, the two are blending their vast knowledge bases together in a brokerage that is able to handle any real estate transaction. Both with local roots to Harford County for over 100 years, they are the area’s best experts! Check out their website at https://www.boyleandkahoe.com/ for more information.