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Does the time of year actually matter when buying a house? The short answer: yes and no.
Seasonality tends to affect factors such as inventory (the number of homes for sale) and purchase price. During spring, inventory is plentiful, but competition among buyers may cause prices to rise. By contrast, home prices may be lower during winter, but inventory is usually limited – and moving in may be more difficult, depending on the weather.
Also, the best time to purchase a home isn’t always when inventory is highest or when prices are the lowest. These are important factors to consider, but broader market conditions and your personal needs also play a significant role.
The upshot? You can find houses during all seasons. Determining the best time to jump into homeownership means understanding the pros and cons of buying a house at different times – and deciding when it’s best for you.
Let’s look at how the time of year affects home buying, plus other factors to consider beyond seasonality. From there, we’ll help you determine your best time to buy a home.
Buying A House In The Winter
Winter is usually the cheapest time of year to purchase a home. Sellers are often motivated, which automatically translates into an advantage to you. Most people suspend their listings from around Thanksgiving to the New Year because they assume buyers are scarce. Sellers who do list at that time usually want to sell as soon as possible. They may even be more willing to throw in extra perks such as appliances and window treatments.
Potentially lower purchase prices aren’t the only savings. Real estate agents want to make sales during the slow periods and are more open to negotiating closing costs and commissions.
However, while prices are cheaper during the winter, inventory is much more limited. Your dream home may be harder to find with such a limited selection.
In general, there are fewer open houses in the winter. Winter may also mean that you may have to navigate house hunting and open houses in less-than-ideal weather, depending on which part of the country you live in. Even if snowstorms aren’t common in your area, you may not see a property in full bloom. You may pass on a home that’s beautiful in spring. It's also hard to gauge the amount of natural light when the days are short.
Your inspector may have difficulty determining the condition of the roof if it’s covered in snow, and they might not be able to test the AC unit because of the cold weather.
Despite winter home-searching challenges, the closing process tends to be speedier. Lenders process fewer applications during this season. Real estate professionals are usually more accessible, and inspectors have less backlog.
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Buying A House In The Spring
Spring is a hot time of year for the real estate market. The warm weather and end of the school year tend to draw out sellers and buyers in droves, which creates a healthy marketplace. That’s both good and bad if you’re looking for a new home. Choices abound, but so does your competition. You may even find yourself in a bidding war.
One of the reasons sales inventory tends to increase when temperatures rise is because houses show better. Trees and flowers are in bloom, and grass turns green again. Houses look much better in the spring sunlight.
There’s also pent-up demand. Sellers and buyers can often sit it out during the winter months. Sellers generally price their homes high during the spring, and then bidding wars tend to break out, which can make for a challenging environment in which to purchase a home.
Home prices may be top dollar, but buying in the spring is popular for a lot of reasons. Families want to get settled before a new school year, there’s more time to shop for a home together and the weather makes it an overall more enjoyable experience.
If you commit to buying in the spring, prepare to move quickly.
Buying A House In The Summer
The summer is still a busy buying season, but you can get a great deal if you’re willing to sit tight until the end of the summer. The market is full of battle-ready buyers in the early part of the season. Like spring, be ready to move quickly.
Expect to come in with a strong offer and not just on price. Sellers want to go with a buyer who is serious and can close the deal. If you need to sell your home to purchase a new one, it’s a perfect time to do so. There’s a better chance you can time your sale and purchase together since lots of buyers are on the hunt.
In most areas the market slows down a bit as it gets closer to August. Late August traditionally gives you a great opportunity to find deals, because sellers slash prices even further. Don’t blow off the houses that have languished on the market during the spring and summer selling seasons. There are numerous reasons why a home might not have sold. It may be that a buyer backed out. Regardless, a home that has been on the market for an extended period may end up being a great find.
Location matters when you purchase in the summer. The early days of summer are considered peak real estate season in the U.S., but it's not true in all the areas of the country. Florida is a great example. The temperature and humidity in the Sunshine State skyrockets in July and August, so searching for homes can be less than pleasant.
Buying in the summer has its pros and cons, but timing matters a lot. If you can hold off until the end of the summer, deals abound. However, if you need to get into a home before August, expect to pay top dollar and move quickly with your offer.
Buying A House In The Fall
Outside of winter, a fall purchase can be ideal for cash-strapped home buyers. Once summer ends, sellers get more motivated. They usually lower their prices and provide an opportunity to get a deal. As is the case with winter, there’s also less inventory during the fall. Many sellers want to avoid moving during the holiday season. This gives you more room to negotiate when you do make an offer.
There are also fewer buyers during the fall. People – particularly parents – who have looked during the spring and summer typically want to be settled into a home before school starts. Once fall kicks in, they tend to put home shopping on hold until the next spring. If you wait until around October, you may be able to get the most bang for your buck. Desperation can start to set in for sellers around that time. This is particularly true of sellers who want to sell their home and get a tax write-off before the end of the year.
You also get more attention from your real estate agent during the fall. Real estate agents have more free time to spend with you in the autumn months because of a decline in the number of sellers.
The Best Time To Buy A House: Other Factors
Seasonality plays an important role in the home buying process, but there are other, sometimes equally important, factors to consider when determining the best time for you to buy a house.
Let’s have a look at some key considerations to bear in mind no matter the season.
Housing Market Conditions
The real estate market may fluctuate with the seasons, but there are also broader market forces that can influence housing prices, inventory and current interest rates. For example, mortgage rates tend to follow the Federal Reserve’s interest rate. So, when the Fed lowered their rate in response to the COVID-19 pandemic (and related economic struggles) in 2020, mortgage rates also dropped.
Even when house prices are low, you’ll want to consider how mortgage interest rates affect your total expenditure over the life of the loan. The apparent savings from a good purchase price on a house may be quickly offset by a high interest rate. With interest rates at historic lows right now, many home buyers are taking advantage of this chance to save big on interest. Even though demand and prices have gone up, plenty of people are finding it a good time to buy a house.
Bear in mind that housing market trends may vary by location. Specific cities – or even neighborhoods – may see trends that differ from the overall market. If you’re moving to a “hot” city or neighborhood, you might encounter higher prices and lower inventory.
Personal Readiness
It’s hard to overstate the importance of personal readiness when determining whether you should buy a house.
No matter the season, you’ll want to make sure your credit is in good shape and your debt is under control before buying a house. You’ll also want to feel secure in your employment and income, ready to commit to living in a specific area and prepared to handle the various costs of homeownership.
Summary
Buying a house is a big commitment, and timing your purchase is important. Each season brings with it both positive and negative factors when shopping for a home, including inventory, competition and prices. Ultimately, though, the best time to buy a house – and get a mortgage – comes down to your own readiness, financial and otherwise.
If you have questions, Rocket Mortgage® Home Loan Experts are here to help.
