Real estate was affected significantly by the COVID-19 pandemic. The demand for houses dropped, and fewer sellers were willing to risk it all for less money. Similarly, the movement restrictions and business closure made it difficult for mortgage providers to ascertain buyers’ creditworthiness.
However, notwithstanding the significant decline of property demand during the spring, there was some hope over the summer as the market and the economy generally started to revert to previous trends. Haunted by the fears of the 2009 housing crisis, leading to a drastic decline in property prices, most lenders became more apprehensive. They feared that some buyers would face challenges making mortgage payments due to job losses. Because of these concerns, many are wondering what the ideal time to purchase a property is. The guide provides you with all that you need to know about timing and other relevant factors.
When is the Most Appropriate Time to Buy a House?
In general, there are three methods for determining when is the ideal time to buy a house:
- Best Month. What month you choose to buy your house always has its ups and downs. However, there isn’t one guaranteed 'best month' to buy a house because prices keep fluctuating.
- Today's economy. Money supply tends to tighten when economies stall. Buyers cannot purchase houses as restrictive money lending is implemented, which leads to fewer sellers in the market.
- Personal Finances. Purchasing a home before you're financially ready or purchasing one that's too pricey may put you at risk of losing your home to foreclosure or not being able to pay your loan.
Generally, if you buy in between April and June, you'll have more possibilities.
Home sellers may not have to hurry to put their homes on the market as the country adjusts to living amid the coronavirus outbreak. Many families don't want to move around before the beginning of a new school calendar, there is also more time to shop, and the weather makes it even more fun.
Buy from July to September for variety and decreased prices
August is the last month of the period when postings are most plentiful around the country. Allowances benefit most from this month because buyers generally have few choices and can bargain with the sellers for reasonable prices.
The interval between late fall and early winter is ideal for budget-conscious consumers.
These are the months of November to January. This time of the year can be the ticket to getting a very affordable home and one that you like and want. Fewer people usually look for houses during these times; hence there is less competition. Sellers knowing this often give buyers better deals and can even accept lower prices for the houses.
Market shifts in your neighborhood
Many older buyers prefer homesteads where they can do activities like farming and domestic animal keeping. On the other side, younger buyers will want houses that look diverse, modern, and close to the cities.
Just observing a neighborhood can give you some important facts about the area. Information such as the number of people in the area, their age, income, and generally what you would be seeking if you choose to purchase a house in that specific area.
Personal factors that influence when you buy a house
Purchasing a property that hasn't been well-maintained or upgraded might result in additional costs, especially in the first few years of ownership or when significant systems fail. New construction has a heftier price tag, but because everything is brand new, there is less of a chance of unforeseen costs. Also, housing costs are simply one aspect of your overall financial situation. Affording a mortgage and its associated costs can be difficult if you're also paying medical bills, children's college tuition, are retired, or have an insecure source of income.
The impact of the seasons on home purchases and sales
While the weather is very different in all the states and cities of the country, some factors such as the school years and holiday seasons strongly affect how fast real estate is moving within these given areas. Below we see how buying and selling a home during these different seasons vary.
Home prices are generally low during winter. Many sellers want to find buyers for their listed houses; hence they can reduce prices or bargain to attract customers. There is a lack of competition when putting money on the homes since there are few buyers.
When the market is slow-moving, sellers are usually encouraged to work harder and smarter. The pressure results in them furnishing the houses to look cozier and more welcoming and pricing them to move faster. During these times, rooms are usually decorated better to look most appealing than most times of the year.
Sellers in winter need their houses to sell to avoid their annual tax burden. However, upon selling a home, the seller has to pay his taxes for the entire time he owned the property. The buyer benefits because they don't have to pay an unnecessary fee.
Hunting for houses during the winter is best for people living in the states where it is mainly cold, as you will see how these homes retain heat. Being comfortable in these houses is very important, and bargaining for such should not be tolerated. A minor benefit of moving in the winter is the ready availability of moving trucks.
The buying and selling of houses in spring are exceedingly high throughout the year's scope without exception. There are many pros related to housing hunting during spring. It is more fun to visit different locations and houses when it is sunny outside, making it the best season to buy a house. The landscapes and gardens are usually very appealing, while the grass is greener and the flowers bloom.
It is also a splendid time for people to know how to plan their year and expenses. It provides them with a better idea of what they can afford and can compete for a property they like with other potential buyers if they like what they have seen.
Sellers enjoy having these situations occur because the client will have the most money mentality, thus making the seller benefit more during this season. Many sellers get into the mood of making the houses as colorful inside as it is outside. All the household equipment is always kept at its best state.
With adequate and reliable research, everyone, from the buyers to the sellers, is on the verge of coming out of the deal pleased.
If you're out in the market looking to buy a property, the summer is best season and could deliver a relaxed experience. However, you will have a limited pool of buyers to choose from. Additionally, the seller may have the house on the market because they plan to start the new year in a different location. Therefore, you might even get the upper hand in price negotiations.
As fall temperatures arrive during autumn, you can visibly see that properties' prices are also decreasing. Most people want to settle down before the holiday season; hence they are fast to settle down on properties that they lack. There is a lack of competition for these houses, as most people made their purchases earlier in the year.
This factor is determined by the fact that people who want to sell their houses at this time either are really in need of the money or their houses weren't bought earlier. A considerable bargaining gap between the seller and buyer of the house is automatically established.
Sellers, as well as buyers, benefit from paying other unnecessary taxes. Sellers don't have to pay another annual fee because the house has been sold already, and the buyer of the house begins to pay for their mortgage taxes. Sellers often also make sure the houses have been decorated and installed to attract more potential customers.
Fewer burglaries also tend to occur in colder weather. During summer or spring, a lot of houses are left open for viewing, thus encouraging theft. Transportation of items by movers is also readily and easily accessible because many people do not relocate during autumn.
Which is the Most Appropriate Time to Sell a House?
In most areas, the best time for people to sell houses is usually between May and June. Homeowners who sell their houses during this period usually earn more because the cost of houses is usually at an all-time high.
On the downside, the worst time to sell a house is in December. Sellers are usually rushing to make sure their houses are sold because it is expected that prices are at an all-time low during this time, and the year is coming to an end.
- Locality is core to real estate. Homes in areas with little room for expansion are pricier than those with plenty of places to expand.
- Take note of appearances, accessibility, amenities in the neighborhood, and development plan before considering any purchase. Proximity to community centers and busy roads may make your preferred property easy to resale.
- Because land tends to appreciate with time, place more importance on the size of land than the house's quality. Choosing to live in a town or a city will impact the cost of your dream house. Land is a scarce commodity, and hence houses in cities with little room for expansion and highly developed towns attract higher prices than those with expansive spaces for expansion.
- Urban sprawls are due to population growth. When a densely populated area experiences an outflow, the value of the community's homes will drop significantly. Consider some spacious neighborhoods because they have numerous uninhabited homes and lands that will fetch low prices. Words from real estate experts, property valuers, and property agents can be the difference; a significant development may be on its way in the area, which can drive prices higher. In real estate, timing is of great essence, and people cannot wish it away.
- An essential factor when buying a home is personal financial readiness. When the buyers' finances are in check, and they can afford the mortgage costs of the area they want to live in, house hunting is more accessible for them and their agents.
According to a Redfin blog post by Marr, sellers who had properties on the market when orders were enforced the shelter-in-place had to choose between keeping their homes listed or pulling them off the market. "Many of them choose to delist, and the market is currently dominated by people who need to sell because of major life changes or events." According to the report, the property market's future is primarily determined by how long the epidemic lasts and its "ongoing effects on homeowners, buyers, and sellers," according to the report.