Dec. 5, 2018.
Winter is coming. Kind of like booking a vacation, there are several benefits of buying a house outside of peak season. But with the potential to save homebuyers some serious money, this one is the biggest.
The ‘why’ of winter homebuying
If you need one good reason to buy a house this winter, it could be this: Housing prices are probably going to be a lot cheaper. This is what most loan officers and realtors consider to be the biggest benefit of buying during the winter — with the expected seasonal price drop, you can get more house for less money.
Here’s a little more on the number one benefit of winter homebuying, broken down into bite-sized pieces:
- Summer sales are slowing. Summer’s over, and housing prices have already started to decrease. Close to 30 percent of listed homes had a price drop in October 2018, the highest number seen in eight years.
- There are more houses than you’d think. One major hurdle buyers faced this summer was the shortage of inventory that drove housing prices up higher. But housing inventory from September to October 2018 only decreased from 1.88 to 1.85 million. And, October’s inventory exceeded the 1.80 million homes from a year before.
- Housing prices have probably hit a wall. The 35 property experts recently surveyed by Reuters predict that rising home prices will only keep slowing down in 2019.
- Christmas is not coming early for renters. Rents saw a small jump this month of 0.57 percent, tacking on roughly $6 for a one-bedroom apartment and continuing the increases that started in June 2018.
- December 26 is officially the top day of the year to buy. This is the day you’re most likely to get a house at a discounted price, based on a 2018 ATTOM Data Solutions analysis of housing prices sitting below market value. Runner-up dates for cheap houses include December 1, 4, 7, 8, 21, and 29; October 12; November 9; and February 9.
As it turns out, the lucky December-26th buyers have a few things in common. These buyers — the same ones who are getting what’s estimated to be the most competitive deal on a house for the year — likely started their home search around Halloween in order to submit an offer by Thanksgiving and close by Christmas.
Some of these holidays have passed, but house-hunting during the off-season is the path of least resistance most buyers don’t take. It makes it possible to get a rock-bottom price.
This could also be the prime time of year to buy if you’re a millennial. Seventy-two percent of millennials still value homeownership as an important life goal, and 90 percent prioritize location over price. Buying in the winter increases the odds of getting into that desirable neighborhood with a much more affordable mortgage payment.
Fact: Buying a house in the winter can be $2,500 cheaper.* Get prequalified now.
6 more good reasons to buy in the winter
Buying in the winter has more benefits than most homebuyers realize. In fact, many buyers prefer it.
This could be why:
- Less competition. Fall’s housing inventory is higher than it was last year, but there’s still less inventory (fewer houses) in the fall and winter overall. Not to worry. In general, there are fewer buyers too. So, you’re probably not going to get into a bidding war over a house.
- More motivation. Less activity on the market means that everyone’s more motivated — buyers, sellers, and realtors alike. In the winter, you’re more likely to get into contract with a seller who’s willing to meet some or all of your demands (and potentially cover closing costs when you ask).
- Faster closings. With fewer buyers on the market, fewer mortgages are being processed. Everyone involved in your closing, like the closing agent, title company rep, seller’s agent, loan officer, and more, will have less on their plate. While it’s possible to close on your house in 10 days any time of year, in this slower season, you may see your mortgage move even quicker and with less delay.
- Dips in rates. Mortgage rates are historically low, and they’re only expected to rise. But loan officers typically see interest rate drops from the months of December to January. This may be the time when rates reach their bottom for the year.
- Extra time to house-hunt. Starting from Christmas break and moving into the pretty much dead month of January, you might find yourself with more time on your hands. Thankfully, you can use it for house-hunting and narrow down your top list of homes faster than you would in the busy summer season.
- Chance the kick the tires. House-hunting in the winter is really the only way to see how well a home holds up in harsh weather. Go to a snowy showing, and you’ll know exactly what you’re getting into in terms of drafts, heating, structural integrity, and insulation. And if you happen to find your dream home with a few blemishes, keep in mind that contractors are also more readily available in the winter compared to the summer.
There’s a better way to mortgage. And it only takes 10 days.
Along with the lower housing prices for winter buyers, you could save even more money when you close on your mortgage in as few as 10 days.** Getting you home in 10 days beats the industry average by over four weeks. Getting home a month faster could potentially save you thousands on the extra mortgage, rent, utility, and storage costs you’d have to pay otherwise. Click here to find a local loan officer and get started.
*”Top 10 Best Days of the Year to Buy a Home.” ATTOM Data Solutions, 2018.
**Timeframe not typical. Not all loans will close in 10 days.
For educational purposes only. Please contact your qualified professional for specific guidance.
Sources are deemed reliable but not guaranteed.