When is the best time to buy a home? Whenever you have the money. But let’s say you have the money. Is there still a “best time” to buy a home? There is no fixed answer to that. Buying a home is very different from planning a trip to Miami. You cannot simply say summers are the best time to buy a home. But, there are factors you can take into account to time your purchase right. Here’s how to determine the best time to buy a home.
The Best Time to Buy a House: Factors to Consider
Ideally, you should buy any property in a buyer’s market. But that isn’t always possible. The real estate market is unpredictable, much like England’s weather. That said, there are three key factors you can keep in mind to time your purchase just right.
1. Time of the Year
Historically, in the US, spring and summer usually signal a boom in the real estate market. It makes sense. People with children prefer to wait until the end of the school year to move cities. That means the months from May to July are the busiest, with home-buying activity peaking by the end of July. These months are also weather-wise conducive to moving around. Demand for homes is high during these months, which pushes up the prices. On the flip side, winters in the US are when the real estate market cools down. People are not too keen to go house hunting in the cold. There is also the holiday season that adds to the lull. Low demand means less competition, which translates to lower prices. But, supply is short, too. There aren’t a lot of homes available on the market during the winter season. There are fewer options to choose from. The supply-demand balance hits just the right notes during the fall season as the frantic pace of summer starts to ebb. But there are still enough properties on the market. If history is our only guide, the fall season is the best time to buy a home in the US.
2. Mortgage Rates
Interest rates on home loans follow market trends. In the last two years, since the COVID-19 pandemic, mortgage rates have been very low in the US. In 2020, lending rates in the US dipped to 2.7%, a historic low. For borrowers with a good credit score and not a lot of debt, now might be the best time to finance a house. That comes with a caveat, though.: Lower lending rates mean the market floods with new buyers. The supply of homes hasn’t increased as much. There is stiff competition in the market, which means higher prices. You will have to do a little bit of math to see if the lower lending rates can offset the higher prices in the long run.
When in doubt, look at trends, both recent and historic. Real estate trends in the US tell you that spring and summer are the busiest time for the real estate market. But, the number of homes listed for sale in the US decreased sharply in May 2020 compared to previous years. Reason? The pandemic. Experts are predicting a continuation of the trend because of lower inventory in the market, stiff competition, and fast turnaround.
When Is the Best Time to Buy a Home? The Verdict
Seasonally, winter and fall are the best times to buy a house in the US. If you are okay with limited options and not getting a full view of properties, winter might be the time to snag a really good deal. If you prefer a wider bouquet of choices, wait for the summer months. You will have to move fast on the offers, though, because there is higher competition. People are also in a hurry to close deals before the school season begins.