Potential homebuyers attempt to predict if a home’s value is likely to rise or fall when looking into investment properties or primary residences. Whereas the right time to buy a house is generally when you can afford it, there are several benchmarks one can follow to determine whether it’s the best time or not.
Among the many factors that can have an impact on your home-buying process are considerations like how much inventory is available, how much you will end up paying at closing and more. With so many of these factors to consider, it might be hard to know the best time.
Read on to learn about a few of the details you should pay attention to when deciding on the right time to buy a property.
When Is the Best Time of Year to Buy a Home?
There are ups and downs in real estate at specific times of the year, and the best time to buy a house is not always when the prices are low. The market and buyer also play a crucial role.
The summer seasons tend to be the peak in the home buying market. This is because the weather is usually warm and kids are not in school, so moving into a new home does not disrupt their learning as it would in the middle of the semester.
Spring is another good season for potential home buyers where you may expect to find more inventory and therefore lower prices. The winter season tends to be relatively slow as very few homes are on sale during this cold season.
However, there are some good reasons to buy a home in winter if you are able. First, fewer buyers are looking to buy a house, and therefore, you will have fewer competitors. Thus, sellers may be more open to dealing with you and would even accept lower asking prices or generous contingency periods.
The second reason is homeowners who list their houses for sale around winter may be more likely to have the motivation to sell.
Is There a “Best” Month to Buy a House?
Overall housing trends depend on your geographic location within the United States and many other factors. Generally, it is difficult to draw big conclusions about what month is the best when it comes to purchasing a property. However, there are a few overall trends that you might want to look at when it comes to the best time of year for a real estate transaction.
January – March
This period might have few house sales, but that does not mean that it is the wrong time to buy a house. Even though there may be less inventory during the colder months of the year, there are also fewer buyers. Depending on where you live or where you are looking to buy, this can be a big advantage.
If you live in a cold climate and do not find the idea of moving into a new home during winter daunting, then purchasing a property toward the beginning of the year may be a good option for you.
April – June
Most buyers would probably agree that there is no better time for purchasing property than during the spring and very early summer months. The warm weather in the northern United States makes for an easy time scheduling home inspections and for properly assessing a property’s value.
Of course, the downside to getting a house during this season is there is generally more competition in the housing market. That would mean you have to be quick to purchase the house, which may leave little room for negotiating the price.
Keep in mind, however, that factors like how competitive a certain housing market is depend on a lot more than just the time of year.
July and August
Across the United States, July and August are by far the busiest months when it comes to home sales. Even though there may be more inventory during this time, there are also more buyers. Depending on market conditions, this can make for a very competitive environment that could easily result in bidding wars and pressure to close fast.
September – December
In general, home sales peak right around the end of August. Once you reach September, there is a marked decrease in closings. This decrease continues into the end of the year, when people are more preoccupied with holidays and saving money.
Overall, home sales do not start picking back up until April of the following year. This means that the end-of-year months are less competitive but also that there are fewer homes on the market.
Depending on where you live, this could be a good time to test the waters, as the few sellers willing to list their homes during this time may be more open to negotiating.
Is Now a Good Time to Buy a House?
Mortgage rates reached an all-time low in 2020 and 2021, and although 2022 will not continue this trend, mortgage rates are expected to stay low. This has led many first-time (and experienced) buyers to ask themselves whether or not this is the right time to buy a property.
At first glance, the unemployment rate and overall state of the economy would suggest that taking out a “cheap” mortgage loan would be a no-brainer. However, the 2022 housing market is relatively strong, meaning that home prices are rising despite any sign of an economic downturn.
This makes the question of whether or not to purchase a home a little trickier to figure out because it means that you will need to take your personal situation into account. In short, there is no “right” answer that will apply to a majority of home buyers at the moment.
It is hard to predict exactly what will happen to mortgage rates in 2022. While many people believe they are set to rise as the economy starts improving and more people rush to buy homes, others are confident that rates will remain low into 2023.
Buying a home at this time, then, should come down to personal factors rather than national trends. These include your credit score, how much of a downpayment you are able to provide, your job security and whether or not you expect to move within the next five years.