Savvy homebuyers can snag great deals when buying a home during the winter months, which are traditionally the housing industry's slow season.
Getting the best possible price on a home is at the forefront of many homebuyers’ minds while navigating the homebuying journey. While there are many articles offering tips and tricks to securing the best deal, one of the most helpful tools you can use is your calendar.
Timing can be everything when purchasing a home. One of the real estate industry's best-kept secrets is that the winter months can be a homebuyer's best friend. Traditionally, the winter months are the slowest of the year for home sales. That often means fewer homebuyers, lower prices, more focused real estate agents and sometimes desperate sellers.
Here are six reasons why purchasing a home in the winter can be a smart homebuying move.
1. Drop in Demand and Home Prices
The change in seasons tends to signal a shift in the number of home listings. The idea of touring houses in the cold and snow doesn’t resonate with a lot of potential buyers, and many homeowners with children want to avoid selling their home in the middle of a school year.
The national inventory of homes tends to dip significantly in the winter compared to the summer, and home prices typically follow suit. In fact, the last months of the year tend to bring the best home prices, according to real estate data firm ATTOM,
“Seasonality has always had an impact on home prices, which tend to weaken in the Fall and Winter months when there’s less buying activity. Savvy homebuyers can take advantage of those lower prices and less competition from other buyers once the leaves start to turn.” -Rick Sharga, executive vice president of market intelligence at ATTOM.
To put this into perspective, over the course of nine years, June’s median home sales price was $229,00, while January's was $198,157.That’s quite a difference.
Let’s take a look at some of the best, and worst, months to buy a home:
When Should I Buy a Home?
| Best Months to Buy a Home | Worst Months to Buy a Home |
|---|---|
| October | April |
| November | May |
| December | June |
| January | July |
This seasonal decrease represents an opportunity for prospective homebuyers to take advantage of potentially huge savings. Let’s take a look at more of the benefits winter homebuying can bring.
2. Motivated Sellers
Part of this is simple supply and demand. Sellers who list a home during the winter may be more interested in making a quick sale rather than maximizing profits. Many listing agents won’t recommend sellers list their homes in the winter. In some cases, sellers with homes on the market during the winter might need to sell fast.
Having a motivated home seller could cut back on negotiations between the two of you and lead to a faster close at a better price.
3. Less Competition
More motivated sellers coupled with fewer competing homebuyers can lead to significant savings on your end. Unlike peak homebuying season, it’s likely you won’t be competing with as many offers on a house. Additionally, someone selling their home during the winter may be more willing to meet your terms than a spring or summer listing. Sellers may be more flexible on the purchase price, closing costs and concessions, the homebuying timeline and more.
The flip side is you may have fewer properties to choose from. While that’s certainly a consideration, many homebuyers find the potential savings and advantages ultimately outweigh the slimmer inventory.
4. Faster Closing Times
Having fewer competing homebuyers out there on the market can also mean both realtors and mortgage industry professionals will have more time to tend to you. Most VA home loans typically close in a 30 to 45 days regardless of the month, but you may be able to accelerate your closing schedule in the wintertime.
5. Test the Season
Shopping for homes in the winter months also gives you a different perspective on properties. Since most home tours take place during spring and summer, you rarely get a chance to take in the overall condition of a home and its surroundings in the fall or winter.
A few things to take note of while house hunting in the winter include:
- Are the streets sufficiently plowed?
- If the home has a fireplace, does it actually work?
- How does the heating system perform?
- Any noticeable drafts?
Yes, you’re working with less daylight to tour homes during the winter, but those hours may actually be more revealing than what you’d see on a warm summer day.
6. End of the Year Tax Savings
With the end of the year comes tax season. If you’re able to close on your home before taxes are due, you could enjoy some potential benefits.
Depending on your state, you may be able to deduct mortgage interest, taxes and points. However, be sure to consult a tax expert before getting too excited.
There’s no guarantee that purchasing a home in the winter will work for you. But this traditional homebuying “off-season” can be an under-the-radar way to get the best deal on your dream home.
So bundle up, brave the cold and consider kick-starting the homebuying journey.
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