Looking for a great deal on a home? Buy in the winter
The days of numerous foreclosures and short sales are long gone, but that doesn’t mean it’s impossible to get a good deal on a home. In fact, savvy shoppers might be rewarded by trading in some of their holiday shopping time for house-hunting time.
That’s because one of the best ways to get a discounted price on a home is to buy in the winter. There are fewer buyers to compete with and builders may offer discounts to unload some of their inventory.
Plus, winter sellers are typically more motivated than spring or summer sellers. Buyers often find themselves in a better negotiating position because even though there are fewer properties on the market, it’s less likely that you’ll be competing with cash buyers for those houses.
In fact, data from the Utah Association of Realtors shows that of the 12 months in a year, home prices are generally at their lowest point in January.
Interested in buying in the winter? Here are a few tips:
Take a break from the holidays
While other buyers are enjoying the holidays, savvy house-hunters are out looking for a home, including around Christmas and New Year’s. Because of the lag between when a contract is signed and when a sale is finalized, the house-hunters who are getting that great January pricing are usually shopping in December.
If you’re working with sellers who need to move immediately and there are only a few buyers out shopping, you’ll be in a much better negotiating position than if you’d waited until spring to start looking.
Don’t incur additional debts
Be careful about any spending during the holidays that could negatively affect your finances. Make sure you aren’t using too much of your credit card limit to buy Christmas presents. Anything that could hurt your credit score might mean you end up paying a higher interest rate on your mortgage.
Know that not everything can be inspected
There are some items that you won’t be able to easily inspect in the winter, such as the sprinklers, the roof and the air conditioning. Be aware of that possibility and consider buying a home warranty to cover unexpected problems.
You also won’t know whether the yard is in good shape because it will look dead and may be covered in snow. See if you can find any pictures of the home during the summer so you can get a better idea of what the yard looks like when it’s not in hibernation.
Take advantage of what can be inspected
On the flip side, you’ll be able to see how the home handles winter weather. Does the driveway get deep snow drifts? Is the driveway tricky to navigate in cold, icy conditions? Are the windows drafty? How well does the furnace heat the house?
You’ll get a much better idea of the home’s performance in cold temperatures when you buy in the winter.
Be careful about pricing
Just because you’re buying in the winter doesn’t automatically mean you’re getting a good deal. There’s still a risk that the home you want is overpriced.
Work with your Realtor to determine the market value of the home before you make an offer. This will help you avoid overpaying. It will also help you avoid making an offer that’s too low and offends the seller, cutting you off from additional negotiations.
Whether the house is priced at, above or below market value, your Realtor will put together a negotiation strategy that will help you determine how much to offer.
Work with a Realtor
To find the best deals, you’ll want to work with a Realtor who specializes in your area. Your Realtor may be aware of homes that are about to go up for sale and may know which builders are offering winter discounts — information you wouldn’t be aware of without an insider on your team.
Robert Bolar is past president of the Northern Wasatch Association of Realtors.