While a lot of people buy homes in spring and summer, there can be real advantages to buying a home in the winter months.
This year in particular, fewer people are participating in the real estate market overall due to multiple economic factors. But the late fall and early winter months might just be a buyer's secret weapon, giving would-be-buyers potential to move quickly. Here's why this is a better time to move than you might think:
Fewer buyers to compete against. People with low-rate mortgages are choosing to stay put instead of upgrading or downsizing, and that means there hasn't been as much housing inventory available. Some people who would like to buy are waiting until interest rates come back down.
In addition, fewer people move in winter because they may be busy with holidays and travel, and they may just not want to move when it might snow.
That means there are fewer buyers in the market right now than there will be in the spring and summer, when more people move. Fewer buyers means you're less likely to get involved in a bidding war or lose out on a home.
Motivated sellers. For the same interest-rate reasons, people who are choosing to sell their homes and move now probably have a good reason other than just wanting to move! That means sellers who put their homes on the market are likely to be motivated to sell, and they may be more willing to negotiate. That's a positive thing for buyers!
Faster closings. Because there are fewer transactions happening in the winter months, it's likely you'll be able to close on your new home faster than you would in the spring. It's quite possible that you could be in a new home by the end of this year if you make a decision quickly.
What about interest rates? Mortgage interest rates are higher than a lot of people might want them to be right now. For buyers, though, there are a surprising number of options that can make moving realistic, even in this relatively high interest rate environment. Of course, you should apply for a mortgage through your credit union, which traditionally offers lower rates than banks and other institutions!
A few options to lower your mortgage costs include:
- Assumable mortgages: If you're buying a home from someone with a low rate, the banks might be willing to let you take over that low-rate mortgage for at least part of the cost of the property. Ask your Realtor to look for these options!
- Adjustable Rate Mortgage: It's possible that interest rates will decrease in the next five years, and that makes an adjustable rate mortgage (an ARM) an option for most buyers. An ARM lets you pay a lower interest rate for the first few years of your mortgage before the rate adjusts to whatever the market is doing. If the interest rate decreases, buyers can refinance their mortgage to lock in a lower rate.
- Mortgage rate buy downs: Banks and other mortgage lenders may be more willing now to let buyers lower their mortgage rate with an upfront payment. In some instances, a lender might be willing to do a temporary buy down of your mortgage rate, funded by the seller! Be sure to ask any potential lenders about all of your options.
Even with relatively high interest rates compared to just a few years ago, you have a lot of options, and the benefits of buying in the winter months make this a surprisingly good time to make your move!
Interested in learning more? We're here to help whether you're upgrading, downsizing or just finding a new place in a better neighborhood for your stage in life. It's always a good use of your time to talk to someone from our Member Advantage Mortgage partners about all of your options and why buying a home in winter is actually a good idea.
We're just a call or a click away, or stop by a branch to make an appointment. Thanks for being a member of CommonWealth One, and happy house hunting!