The cornerstone of almost every American dream is homeownership. After all, owning a home allows you to create a place you can call your own. A home is more than a piece of real estate – it can become an extension of who you are as a person and family. From a financial perspective, homeownership is a cornerstone of planning and investing, as it allows you to build equity, enhance your credit, and purchase a significant financial asset.
A variety of factors go into homeownership and buying a home. There is also a key question that you have to ask yourself: When is the best time to buy a house? Is there even the best time of year to do so?
The answer is complicated.
There are many reasons why the timing of home buying may impact your housing journey.
First, consider available inventory and how the available inventory may impact prices. The weather may matter depending on where you want to buy a home. People may be more willing to move in warmer or cooler weather than stifling heat or freezing snow. While the weather may make it more convenient for you to see houses, remember that this is the case for others. As a result, you may face more competition for available houses, which may drive prices up.
Holiday travel can also impact home buying. After all, are people really selling homes during the holidays, when they want to spend time with their family, and when the weather may impact travel? This decline in people shopping often leads to lower prices, particularly for motivated sellers.
This particular weather question leads to another: What about pent-up demand? Previous research has suggested that pent-up demand increases in the Spring. As a result, you may be in a bidding war, forced to pay higher prices that may impact your financial planning or force you to buy a less expensive house.
Timing doesn’t just directly impact the home-buying process. Indeed, the time of year impacts a variety of factors that will, in turn, alter how easy it is for you to get a home. These include:
What does all of this mean? Determining the best time to buy a house is about more than just the timing of the home-buying process. It is also about how the month or season may impact the economy.
Answering this question is complex. There is no question that local factors – including weather and specific housing market conditions – can make an impact. However, the best time to buy a house is typically late Fall and early Winter. Nicer weather – like that in May or June – can increase demand, which increases prices. Demand slows in the late Fall and Winter as the holiday season approaches, and the weather makes it harder to go out.
Furthermore, inventory is typically still available during this time of the year. As such, you may be better positioned to negotiate a better price or more favorable terms. You may also be able to close a deal faster: The reduced demand for real estate also means lower demands for related services, such as appraisal and inspection. As such, you may find yourself in a situation where you can pay less and close faster.
That’s not to say there aren’t challenges: If bad weather is truly a problem in your area during this time, you’ll have to plan accordingly. This can particularly be the case for inspection, when ice and snow may cover roofs or make it harder to test certain systems, like air conditioning.
Buying a house is complicated under the best circumstances, and determining the best time to buy a house can add a layer of difficulty to this process. If you ask yourself, “When is the best time to buy a house?” you’re already ahead of the pack, as you are clearly trying to determine how to save money and buy the best house possible.
