According to the National Association of Realtors, existing home sales rose strongly in September. But the winter and holiday months are typically a slower time of year for real estate. That can work to the buyer’s advantage, though. Fewer real estate transactions can translate to less competition, more motivated sellers, quicker mortgage approval, plus other advantages. Following are five reasons this holiday season could be the ideal time to buy a home.
1. Less Buyer Competition
The winter months come with less-than-favorable weather conditions for would-be home buyers. That means fewer people are looking to purchase homes, and less buyer competition. That minimizes multiple offer situations and bidding wars, as was seen earlier this year. There are still plenty of homes on the market but less buyers vying for them. Lower demand could equate to better bargains and more negotiating leverage for buyers.
2. Serious Home Sellers
Most homeowners would prefer to spend this time of year giving thanks, spending time with family and friends and gift-giving, as opposed to trying to sell their home. As such, holiday home sellers are serious. They are inclined to negotiate. Sellers are usually more flexible in areas such as price and closing costs. Sellers can make other concessions, too, to get their home sold. They may leave items behind. The riding lawn mower in the garage could be yours. Be cautious, though, when home buying in the winter. Sellers will “stage” their homes to sell. It’s easy to let your emotions take over, imagining yourself opening Christmas presents in a tastefully decorated home. But don’t overpay. Studies show that staged homes sell 73% faster. Make sure you’re buying the home, not the feeling.
3. Faster Mortgage Approval
Traditionally, the holiday months tend to be slower ones for mortgage lenders. Slower business isn’t a good thing for the lender, but can be great for the home buyer. Lenders have an extra incentive to get loans closed quickly and offer exceptional levels of service. Fewer loans could result in quicker approval times. A quick closing could help you negotiate a better deal on the home you’re buying.
4. Tax Advantages For New Homeowners
One of the biggest reasons that many buyers make the leap from renting to buying is for the tax benefits. If you wait until January to buy, you won’t realize the tax advantages until the following year. Closing by December 31 can mean tax benefits for home buyers, like deductions for mortgage interest, property taxes and some closing costs. Always consult a tax adviser before filing, but these deductions can be significant for homeowners, especially in the beginning months of your mortgage.
5. Greater Home Affordability
Home prices are typically at 12-month lows in December. Lower home prices mean buyers can purchase more home for less. As mentioned earlier, holiday home sellers are generally more serious about getting their homes sold. Sellers typically know that the winter months aren’t necessarily ideal for selling their home. As such, there’s usually a specific reason that, instead of doing some holiday shopping or attending a holiday party, they’re trying to unload their house. Whatever the reason may be, thanks to lower-than-average home prices, the timing could be ideal for making an offer on your dream home.