How Buying a Home in Winter Can Make the World A Better Place
We’ve all heard the conventional wisdom about buying a home in the spring, when the real estate market is more “active”. But sometimes, it doesn’t always work out that people can buy in the spring. Sometimes waiting until spring doesn’t make sense or fit someone’s time frame. Sometimes there is no need to wait. I can think of at least five reasons to buy a home in the Winter:
Consider the Competition
1. There is lower competition from other buyers. Generally, families with children prefer to move into their new homes during the summer so the kids can easily transition to a new school. Therefore, the spring and summer months are busier in the real estate market and there are usually more listings and definitely more buyers.
We’ve had a lower than normal inventory of listings for a few years in the Frederick real estate market. Last spring and summer we saw a lot of multiple offers on the homes that were priced competitively and in good condition. We’re expecting a similar thing in 2018. Demand continues to outpace available homes.
As a buyer, you’ll find far less competition in the winter months. Fewer buyers means fewer multiple offers and less likelihood that you’ll be outbid. With less competition, sometimes buyers find that they have a little more breathing room to make a decision.
In the busy real estate season with the possibility of multiple offers, sometimes decisions have to be made in hours or even instantly. For some buyers, that frenzy of decision making is very stressful. If you find that you are easily stressed by the rush and pressure, consider buying in a slower time for your market. Winter and fall are usually a more relaxed time to buy, one of the best reasons to buy a home in winter.
Consider the Process
2. Because there are fewer contracts written, its possible that the entire process can be smoother and quicker. Everyone involved: the lender, the title company, the home inspector, and the Realtors® are usually (not always) not as busy. Even the contractors are not as busy if you need repairs or items come up in a home inspection.
Your real estate transaction may be one of a dozen, rather than one of five dozen. You may even get a little more personal attention, one of the best reasons to buy a home in winter! (imo)
Again, if a more relaxed process is important to you, consider buying a home in the winter months. People are often “nesting” and staying cozy and warm, not out braving the cold weather. Home buyers are often still in the consideration mode, researching the process and getting their finances ready. It can be a great advantage to jump ahead of the rush.
Consider the Sellers
3. Motivated Sellers. Though there are fewer buyers and the inventory of listings is often lower than the warmer months of the year, the sellers who still have their homes on the market are serious and highly motivated. A motivated seller is ready to negotiate.
Sellers who get ahead of the spring market and list their home in the winter months are also motivated. (No one puts up with buyers trampling through the snow and into their home unless they want to sell their home!) Savvy sellers know that selling in the winter can be an advantage in the same way that buying a home is…less competition and fewer, but motivated buyers.
Consider Financing Conditions
4. The average and median sales price of homes dips during the winter months, according to long-standing statistics. The number of homes sold typically decreases as well. As mentioned earlier, generally, fewer buyers are out looking and the inventory is lower than in a spring or summer market, although that doesn’t hold true every single year.
The price fluctuations from Mid-year to January are interesting to note. I want to be very careful, however, to refrain from drawing conclusions. Several different theories are used to explain this. Some think that sellers are more motivated. Some think there is a different inventory in the winter months, explaining that listings during the winter months includes more distressed sales, fewer traditional sales. Some think that the makeup of buyers is different; more investors are in the market. I can’t really say why, but statistics show that average sales prices dip a little during the winter.
Are You A Move Up Buyer?
Selling your home and buying another home can be a challenging endeavor. Time frames have to align between two sets of sellers and buyers. Sometimes the process is a lot smoother if people have a bit more time and are a bit more relaxed.
If you are one who doesn’t enjoy a frenetic pace, you might find that buying and selling a home in the winter months fits with your way of living and making big decisions.
Consider the 2018 Outlook
5. As far as this winter goes, it makes sense to buy now, rather than at the end of the year. Interest rates are projected to rise this year. The Mortgage Reports is a site I like to follow for information, news and projections. Here is an excellent article about what we can expect in mortgage rates for 2018. According to my gurus:
“There is no shortage of market-moving news in January. More important, the month sets the tone for the new year.That’s why it’s important to focus on this month’s events, but also predictions for 2018.”
The general consensus is that the 30-year mortgage interest rate will go up in 2018. We’ve already seen the interest rates bump after good economic news in 2017. Many experts feel that mortgage rates are actually too low for an economy that is doing so well. Here are the top predictions:
- Freddie Mac: 4.4%
- Mortgage Bankers Association: 4.6%
- Kiplinger: 4.4%
- National Association of Home Builders: 4.2%
So buying today before interest rates rise can save you on your monthly mortgage. This is one of the most logical reasons to buy a home in winter… See how interest rates affect your monthly mortgage.
In Conclusion – Reasons to Buy A Home in Winter
While buying a home in winter may not necessarily make the world a better place, it will certainly make YOUR world a better place! There are lots of benefits to owning your own home. Paint your walls in the color of your choosing, redecorate as you please, remodel to your liking, plant a plethora of flowers to enjoy, and enjoy the financial gain of building equity. Your world and your family’s will certainly be a better place!
Photo Credit to: Porsche Brosseau on Flickr