Buy in the winter months.
There are good and bad times of the year to buy, and there are good markets and bad markets.
If you can, probably the best time of the year to buy your home is in December, preferably during the last two weeks of the month when everyone is fussing about the holidays.
Historically, there are fewer home sales between Thanksgiving and New Year’s (by a wide margin) than any other time of the year, simply because fewer buyers are out looking. Most buyers get involved with the holidays and put off home searching until after the New Year. The last few weeks of December traditionally have the poorest sales of all.
Most sellers who haven’t been able to sell their homes during the summer months feel the same way and remove them from the market after Thanksgiving. Often the only sellers who keep their homes up for sale (or list them at this time) are those who are desperate to get out. And if they haven’t sold by the end of December, those sellers are very desperate, indeed.
There are so few buyers at the end of the year, in fact, that “motivated” sellers will often grab at ridiculously low offers just to get out of their property. If you want to save money, that’s when you should make your offer.
Buy your home in late December..
TIP—BUY AND SELL AT THE PEAK TIMES OF THE YEAR
Buy in the winter months, and then sell in the spring and early summer to maximize your profit.
TRAP—BEWARE OF HOT
MARKETS
During the very hot markets of the first years of this century, prices and sales continued to rise even at year’s end!
Try to avoid buying in late spring and early summer, specifically the months of April, May, and June. Historically, 30 to 40 percent of all homes (new and resales) will be sold during those three months. They are the peak selling times.
Abig reason that April, May, and June are such good sales months has to do with school schedules. The school year is ending and fami-
lies with children feel it is an optimum time to make a move. Also, fam-
ilies tend to be more financially optimistic in the spring and more willing to take the big step involved in a home purchase. Finally, it also has to do with appearance. After the cold and/or wet winter, houses tend to look fresher and more appealing in spring. (Sellers, of course, know this and spruce up their places even more to lure buyers.)
If you want to pay top dollar, join the throngs of buyers and purchase in spring and early summer. Otherwise, wait until the cold of December when you’ll usually have better prices.
What If It’s a Seller’s Market?
A rising market is often called a “seller’s market.” The reason is simple: There are many more buyers than sellers. Thus, the seller can raise prices and dictate terms—hence a “seller’s market.”
One characteristic of a seller’s market is that homes sell very quickly. This is measured by how long they are listed for sale, before actually selling. If listed homes are selling in less than 30 days, it’s a sign of a seller’s market.
Another characteristic of a seller’s market is that there will be low inventories. Inventory means how many homes are for sale and how long it would take to sell all those that are listed. Normally there will be around a six-month or longer inventory of homes in any given area. When that number dips below two or three months, it suggests a sellers market.
Also check the direction of inventory change. Is the inventory growing, or falling? A falling inventory is another indicator of a seller’s market.
TIP—GET THE BEST INFORMATION
To find out how quickly homes are selling and what the current inventory is your area, you should check with your local real estate board. You can contact any member agent who should be able to readily get the information for you. Or you can simply call them—their number is in the phone book under “Board of Realtors®” and they should either be able to give you the information, or refer you to an agent who can get it for you.
Finally, keep a lookout for prices. In a seller’s market, prices will rise. As soon as you see them going up, it may be a good idea to jump in. Never be afraid of the early days of a seller’s market. Keep in mind that even though prices may be somewhat higher today than last year, they’ll probably be even higher next year. If prices are going up, the home you buy today will be worth even more next year and, hopefully, more still the year after that. You want to catch and ride the wave.
Buy in the winter months
How Do I Know When the
Market Has Peaked?—The
Seven-Year Cycle
After there’s been a seller’s market for awhile, the news commentators on TV, the radio, and in print will sometimes begin talking about a “real estate bubble.” They will begin forecasting that the market, which may have gone up for a few years, is ready to crash. They may speak of a “real estate bubble” about to burst.
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