By the time you’ve saved up enough to buy your first home, you’ll probably be eager to become a homeowner ASAP. But just because you’re financially ready to purchase a house doesn’t mean you should do so right away.
“Timing is everything in real estate,” says Moira Taylor, owner and CEO of Taylor Made Realty in Atlanta.
Real estate market conditions are always changing, which means you can snag a good deal if you’re strategic with your timing. We asked Taylor and other real estate industry professionals to weigh in on the pros and cons of buying a home during different times of the year.
Here’s a rundown of what you need to know to determine the best time to buy a home for your situation:
- When Is the Best Time To Buy a House?
- Is Now a Good Time To Buy a House?
- The Bottom Line
When Is the Best Time To Buy a House?
Homes are sold all throughout the year, so there’s no rule that will guarantee the best time of year to buy a house. However, real estate market trends can help you predict when you’ll have a greater selection to choose from and more leverage to land a better deal. In order to determine the best season to buy a house for you, it may be helpful to consider the following real estate patterns.
Spring and fall: More homes to choose from
You can expect to find more inventory arriving on the market in early spring or early fall, according to Yawar Charlie, a series regular on CNBC’s “Listing Impossible” and estate director at Aaron Kirman Group, a real estate company based in Beverly Hills, California.
“Oftentimes this is dictated by the environment in areas where weather plays a huge part in being able to view and show homes,” Charlie says.
In areas that experience harsh winters, he says it’s easier to photograph and show houses in their best light during spring and fall. As a result, these are the times when you’re more likely to find a greater selection of homes.
“Generally speaking, more transactions are happening during spring and fall, so sellers list their homes during those times when possible,” says Jules Borbely, a strategic real estate consultant for Real Estate Bees and COO of Oxford Property Group based in New York. “It allows you, the buyer, to have more options and be more selective. It also means that there is more competition during these seasons.”
That’s a tradeoff to keep in mind when you’re planning to buy a home. While you may find more choices during spring and fall, you should also be prepared to compete with other buyers who will be interested in the same properties. At the same time, it can be more convenient to buy in the spring if you’re expecting to receive money back from the IRS.
“Another reason buyers like spring is some of them use their income tax refunds towards their down payment to purchase a house,” Taylor says.
Winter: More opportunity for discounts
As the temperature cools down during winter, so does the real estate market in many places, which presents a different set of pros and cons for homebuyers.
According to Borbely, there’s lower inventory and less competition in the winter, which can help you score a better deal on a home. After all, a seller with multiple offers can leave you with little room to negotiate. But if the active buying season is over and the seller hasn’t been able to offload their property, you may be able to get them to lower the asking price, says Kelsey Martin, a licensed real estate salesperson at Compass, a real estate company, based in New York.
“Personally, I find one of the best months to find a deal on a house is actually December,” Charlie says.
However, there can also be downsides to buying a house during the wintertime. Taylor notes that purchasing a home in the winter might be not be ideal for families with children who are celebrating the holidays and may not want to move while the school year is in session. Even for those without kids, viewing homes and moving during winter could present logistical challenges brought on by harsher weather conditions.
Summer: More convenient for families
Families have extra considerations when they’re looking to buy a home. The adults need to weigh how the timing of the move will impact work and school schedules — meaning summer can be a more convenient time to buy.
“For ‘growing family’ buyers, moving in the spring or summer offers the opportunity to start the upcoming school year in your new district, which may be a main factor for your decision to move in the first place,” Martin says.
Families may have more time off to shop around and plan their move, and there are more homes available on the market. Warmer temperatures are another reason why buying a home in the spring or summer is ideal, according to Taylor.
Is Now a Good Time To Buy a House?
If you’re not familiar with real estate markets, you might be uncertain about how to determine if it’s a “good” time to buy a home.
“The ideal market conditions for buyers are low interest rates, a surplus of homes on the market, financial stability and a healthy economy,” Taylor says.
While the number of available homes varies with the seasons, it can be particularly beneficial to monitor interest rates and the direction in which they’re forecasted to trend.
“The best time to buy a house is when the interest rates are low,” she says. “Lower interest rates empower the buyer to access more purchasing power for a home.”
It’s also useful to keep an eye on average home values and prices. In an ideal scenario, you’ll buy low, and the value of your home will increase over time.
“There will never be a bell when the market hits the bottom,” Martin says. “However, if you buy during a time when sales are experiencing decreasing average pricing year over year, you have a better opportunity to achieve a greater return on your investment when you go to resell in 5, 10, or so years down the road.”
Essentially, it’s helpful to find out whether your local real estate market favors buyers or sellers.
Is it a buyer’s or seller’s market?
You could probably guess that the difference between buyer’s and seller’s markets is who benefits from the market conditions. But here’s exactly how you can tell one from the other.
“The rule of supply and demand is at play,” Taylor says. “A buyer’s market is when there is a surplus of inventory of homes, resulting in buyers having plenty of options of homes to choose from. A buyer’s market forces prices of homes to decrease because the level of competition for the seller increases, giving the buyer leverage on pricing.”
A seller’s market, on the other hand, involves competition among buyers over fewer available homes.
“A seller’s market is when there is a shortage of inventory of homes being sold, resulting in the power being with the seller because there is not enough inventory to fulfill the demand of buyers looking for a home,” Taylor says. “Typically, in this market sellers are selling their homes over their asking price.”
Read More: MyWalletJoy’s Hope for Homeownership Report
The Bottom Line
To determine the best time to buy a house, you’ll want to consider how seasonal real estate trends, interest rates, and other factors can impact home prices and availability. Make sure to take into account how the timing of your purchase will affect not only the price you pay in the short term, but also the value of your investment in the long term. You can find your dream home at any time; however, you’ll be rewarded for buying your dream home at the right time.