The Sneaky but Smart Winter Purchase
[two-thirds-first]The real estate market is one of seasons. Conventional knowledge says that the market heats up in the spring, chugs along through the summer, and starts to cool off as the temperatures drop and the holidays come into view.
That cycle has been especially true over the last couple of years, with the spring market only growing more saturated and competitive. It is not uncommon for houses to receive upwards of 10 offers, or to sell in a day. Take a look at the following graphs that shows just how crazy the spring has become.
As a buyer, how do you gain an edge in that kind of market?
You could attempt to gain a competitive edge by paying cash, closing quickly, or even waiving inspections and appraisal contingencies. But each of those moves is pretty risky in the long run… so maybe you just skip the competitive season all together!
I always tell my clients that the best time to buy a house is in December. They inevitably look at me like I have three heads, but hear me out.
If a house is on the market come December, it’s likely that the sellers are highly motivated. They are not waiting around until the spring market picks up; they want to sell and they want to sell now. This tips the scale in the buyer’s favor.
Another advantage of the winter market is that the chances of fighting tooth and nail with 10 other offers or getting into a bidding war are far lower than they would be in the spring. There just aren’t as many people looking for houses, so competition is scarce. With less competition, there is far less of a chance that you’ll end up paying above list price. Some of the best deals I’ve ever made were in the deep winter market. In fact, I always tell people that the best offer I ever wrote was on Christmas Eve.
Are there equally valid reasons to look for a house in the spring? Of course. Families may want to move during the summer to avoid disrupting school schedules and life gets busy around the holidays, making it a tough time to add more chaos to the mix. But if you have a little more flexibility, and you’re looking for a great deal, December is a great time to find it.