When you go out to buy a house, you’re going to want to buy the best house possible for the least amount that you need to spend. It’s a good idea to be cautious because you know that you’re going to be making one of the biggest purchase of your entire life when you sign the dotted line. So, when's the best time to buy a house?
Even if it looks like you’re getting a great price for your home, there are other ways that you can still try to find other advantages. Knowing when the best time to buy a house is one of the many advantages to get the best deal for the home you’ve always wanted.
Factors That Make an Impact on the Best Time to Buy a House
There are two main factors that you think about when you’re deciding on the best time to buy. More specifically, you should look at the surrounding market as well as your personal circumstances. You need to go into this decision-making process realizing that there are some in each case that you will have no control over.
What Are Market Factors?
Market factors include interest rates, knowing the difference between a buyer’s or seller’s market, and what you’re looking to do. Lower interest rates are better when you’re trying to pay off your mortgage in a reasonable amount of time.
When you’ve decided you want to buy a house, then you’re going to pay attention to what’s happening in the market regarding selling and buying. A buyer’s market is when the conditions are ideal for home buyers. You’ll find plenty of homes for sale and sellers typically drop prices to get their homes sold.
Seller’s markets are different in that sellers control the strings so to speak. That means that the demand for homes outranks the supply of available inventory and sellers know they can ask more for the home they are selling. In this situation, a seller can demand a high price and often get what they want.
What Are Personal Factors?
Many personal factors can influence whether or not it’s the right time to purchase a home. You need to think about your financial situation as well as your lifestyle expectations. You might not realize that maybe it’s not the best time to buy a house until you take some time and think about these things.
When you think about your financial situation, you need to consider your income and whether or not you make enough to qualify for a house payment. Your credit score will also impact whether or not you’re going to be approved for a mortgage loan. Do you have a down payment? Will you be able to afford typical home maintenance expenses along with the times when the big things die like your air conditioner or other major appliances?
Then there is your lifestyle to think about. Do you have the availability to maintain your home? That means taking the time to mow the lawn, paint the sides, and generally take care of your home inside and out. What about plans to move in the foreseeable future? Do you see yourself settling down or will you be moving somewhere else?
Understanding Seasonal Supply and Demand
Finding the best time to buy a house isn’t exactly cut and dry. There are other factors to consider when you’re trying to figure out whether or not you’re going to move forward. Supply of homes versus demand for homes in your area of choice make a significant impact on the price you can expect to pay, but did you know that each up and down is seasonal? It’s true!
Spring and Summer
Warmer weather and longer daylight lead to more people putting their homes up for sale in the spring and summer. The supply increases, but it does not cause the price to go down. This time of year is actually more competitive, and sellers will demand higher prices.
It makes sense, though, when you think about people and their personal situations. It’s easier to move during this time of the year when you do not have to deal with potential snowfall or cold weather. Moving during the summer is also easier for families with school-age children because it offers a time of year where a clean break can be made before starting over the following school year.
Fall and Winter
When you think about cooler days, moving doesn’t seem quite so appealing. Fewer homes are available, and buyers seem to fizzle out. That doesn’t mean the buyers aren’t out there, but it does mean that homes are more likely to sit longer. As a result, prices may be more negotiable with sellers.
In the fall, families are busier with school schedules, holiday planning, all combined with weather that can be a pain to deal with. No one wants to be planning a cross-country move when little Johnny still has his Christmas concert or when little Susie is working to perform in a dance recital.
Knowing When to Start Looking at Houses
Each month brings different challenges, so you need to know what you’re willing to do and what you’re dead set against doing at all. You want to choose buying times that are off-season, so months like January or towards the end of August present excellent opportunities to purchase a home and save money doing it.
Backtrack from your targeted home purchase time to determine a timeline that is going to work for you. Remember, your home-buying experience is going to be different from others because there may be multiple factors that are important to you compared to anyone else.
What Kind of Buyer Are You?
If you are a first-time buyer or someone that is on a strict budget, then you want to aim for a January closing, or maybe even over the Christmas holidays. To meet your deadline, you want to look sometime in the fall and give yourself a good couple of months to explore without feeling pressured.
Experienced buyers or those with a budget range may have a better experience in the summertime because there are more homes to choose from. You may be the type that is looking to move to a different neighborhood or for an upgrade from your existing house.
Another common scenario is needing to sell a home before being able to purchase a different home. If that’s the case, you’ll want to list your house towards the end of April or beginning of May. The reason for doing so is the busy time that happens at the start of June, so chances are that your home will sell faster.
You’ll need to be ready to partake in the busy time, too, to buy your home, but it may be the perfect storm that you need. Not only will you get your house sold quickly, but you’ll also be in a better place to find the home you really want to call your own.
Taking the Plunge and Buying a Home
There’s no way around it – buying a house is a massive decision to make. It will impact your family, your future, and your very existence as you know it. A purchase like this quite literally can change your life.
When you decide to take the plunge, you need to know that you can’t control every facet of the market around you. At the same time, that doesn’t mean you can’t find the best time to buy a house if you do some legwork along the way. You’ll be better equipped to make the right choice, and as a result, you’ll be less likely to experience buyer’s remorse or wonder if there was something better out there after the fact.
Do some research for the seasonal ups and downs for the area that you’re looking for. Consider contacting a real estate agent that is local to your final destination and asking questions. If you are willing to work the market and understand when the time is right for you, it becomes possible to save thousands of dollars on the home you want. Your bank account will thank you.
Featured Image Source: Pixabay.com