Best time of year to buy a house

For at least two years now, the real estate market has seen high inflation and bidding wars. Many buyers have used all the cash offers to beat the competition, not to mention paying well above the price.

Recently, however, the market has started to show signs of slowing down. Home sales fell 14.2 percent year-over-year between June 2021 and June 2022 due to the recession and rising interest rates, according to the National Association of Realtors (NAR).

At the same time, real estate activity boosted by the pandemic is beginning to return to traditional patterns. That means spring and summer may once again be the busiest times of the year, while fall and winter may return to the slower months.

The average cost of buying a home in the US

US home prices have been on the rise of late. In June 2022, the median existing home sale price rose 13.4 percent from a year earlier, reaching a record high of $416,000, according to the NAR. See last year’s average home prices month by month.

Source: National Association of Realtors data
June 2022 416,000 dollars Up from $366,900 in 2021.
May 2022 408,400 dollars Up from $355,000 in 2021.
April 2022 395,500 dollars It will rise from $340,700 in 2021.
March 2022 379,300 dollars Up from $326,300 in 2021.
February 2022 363,700 dollars Up from $310,600 in 2021.
January 2022 354,300 dollars Up from $303,600 in 2021.
December 2022 358,800 dollars Up from $309,200 in 2020.
November 358,200 dollars Up from $310,800 in 2020.
October 2021 355,700 dollars Up from $313,000 in 2020.
September 2021 355,100 dollars Up from $311,500 in 2020.
August 2021 361,500 dollars Up from $310,400 in 2020.
July 2021 364,600 dollars It’s up from $305,600 in 2020.
June 2021 366,900 dollars Up from $294,400 in 2020.

Median real estate prices have risen for years — an impressive 124 consecutive months of year-over-year increases, according to NAR. This puts off many prospective buyers and especially first time home buyers. Proportionality is a major concern with the risk that the market may correct in this price growth. Still, experts who rely on median sales data to gauge the overall health of the market say the outlook is strong.

Buying a house in winter

Typically, home buyers get a better deal on purchase prices when the cold weather sets in. A 2021 report from ATTOM Data Solutions shows that buyers who closed in October paid the smallest “above-market premium” on home purchases at just 2.9 percent. December represents the next best deal, with premiums at 3.4 percent, followed by November and January, both at 3.9 percent. (By comparison, buyers who closed in May typically paid an 11.5 percent premium.)

But scoring a deal in the winter isn’t necessarily a sure thing in an overheated housing market. “In the last two years, it has not been cheap at all [here] to buy a home in the summer,” says Kerry Rizzi, a Realtor with HomeSmart Homes and Estates in White Plains, New York. “However, if the market continues to correct itself over the coming months, it could once again be true that the best deals to be had come in the winter.”

The cost of moving is generally more affordable in winter as well. Bill Gassett, owner of RE/MAX Realtor and Massachusetts-based Extreme Real Estate Exposure, says, “Companies that move in the winter will charge less because demand is lower.” The peak activity season is from spring to winter, and prices from moving companies across the country reflect this.

advantage

  • less competition; Generally, fewer buyers are looking for a home during the winter, which means less competition. “Less competition means more negotiating power,” says Dino Dinena, a realtor at Southern Lifestyle Properties in Hilton Head, South Carolina.
  • Low prices: Home sales prices are directly proportional to market competition, Dinena says: “Competition is lower in the winter, and therefore sales prices are lower in the middle of the year.”
  • Increase agent assistance; Come summer, real estate agents can help you through the buying process more than they can in the high summer. “With fewer buyers in the market during the winter, realtors enjoy a more flexible schedule,” Dinena says. “This means you can expect better attention and enhanced one-on-one advice from your realtor during the winter.”

Cons

  • Less stock. Typically, there are fewer homes on the market during the winter. “Sellers may not want the hassle of moving during the snowy months,” Rizzi says. Additionally, “Parents may not want to change their children’s schools during the school year, and sellers may find that they won’t get top dollar for their home and may wait until the fall selling season, when it will fetch the highest price.”
  • weather problems; Depending on where you live, winter weather can make housing even more challenging. Even closings can be postponed due to weather, Rizzi said.
  • Home tests can be difficult: It can also be more difficult to inspect houses in cold weather. “If the roof is covered with snow, you can’t tell the condition of the roof,” Dinena said.

Buying a house in the summer

It’s no secret that home prices are higher during the summer. According to Redfin Data and Fitness Small Business Statistics, homes sold above list price between April and August.

Still, there are a few tricks to help you save money if you’re hoping to buy in this highly competitive year. If your timeline is flexible, consider waiting until late summer to make a home delivery. “The last two weeks of August are a great time to buy, because many other buyers have given up their summer search and are taking a vacation,” says Kathy Severance, a Realtor with Douglas Elliman in Palm Beach, Florida. “Also, sellers are anxious and fear that the offer may not come at all, so their motivation increases at the end of August.”

Another option is to look for mods that are worth selling. “If you’re handy and want to practice your HGTV skills, roll up your sleeves and find homes that need some updating,” says Rizzi.

Homes being sold by the owners, rather than through a real estate agent or broker, can offer an opportunity for savings. “A property for sale by owner, especially one that has been sitting on the market for weeks or months, may be tired of the constant begging and a savvy buyer may be ready to sell,” Rizzi said.

advantage

  • More details: The addition of summer listings means buyers have a luxury of choice. “With so many homes on the market, you have a variety of options,” Dinena says.
  • Visibility: In the warmer months, buyers can get a more complete view of future homes. “Summer gives buyers the best opportunity to see every inch of a property, to get a real feel for the overall look and feel of the home,” Rizzi says.
  • easy movement School is out and the weather is generally more pleasant, making the moving process much more manageable than it would be in the winter.

Cons

  • Increasing competition; You won’t be alone when buying a home in the summer—it’s peak time for the real estate industry, and it’s very competitive.
  • High price: With increased competition comes more bids and ultimately higher prices. “During the summer, bidding wars are fierce and multiple offers are common,” says Dinena. “Because of this, the price is higher during the year.”
  • High moving costs; A company’s price is influenced by supply and demand. And come summer, when demand increases, so do the prices you pay for a moving company. All that hard work in the heat might not be so much fun either.

Other factors that affect housing costs

  • Mortgage Rates: As rates go up, home buying becomes more expensive. “When interest rates go up just one percentage point, buyers lose about 10 percent of their purchasing power,” says Severance. “Pre-approved for a $500,000 home a few months ago [may] Now let the buyer buy only $450,000.
  • Lack of production A lack of housing supply will drive up prices. For the past few years, demand for housing has far outstripped supply – although there are signs that the shortage is easing, which could cool house prices.
  • High inflation; Rising inflation has a real impact on the overall cost of living. Buyers who previously felt ready to spend some of their savings on a home now choose to save for ever-increasing day-to-day expenses.
  • Risk of recession: When consumers feel nervous about the economy, especially when there is talk of a recession, they tend to scale back their spending, or even stop spending altogether. “This has an immediate effect on housing costs – sometimes so immediately that the real estate market seems to have changed overnight,” says Severance.

Questions to be asked

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