Do you know when the house buying season starts? You may think that buying a home is solely dependent on economic fluctuations and low-interest rates. While it’s true that they play an important role, a good time to buy a house is also determined by the seasons. House price seasonality can have a huge impact on securing a great deal for a great home. The COVID pandemic and quarantine have changed the dynamics of house buying season but peak buying seasons still exist. Let’s discuss these a bit!
What Time of Year is Best to Buy a House?
Over the years, a trend in house buying season has emerged. Spring and summer seasons seem to be the times with the most house-hunting activity, with a cooling period occurring in winter. This has a significant impact on home prices throughout the year up to 10%. You should take advantage of house buying seasonality for the best possible deal you can get. Here are a few more tips to maximize house buying season:
- Know the market – The most important aspect of taking advantage of peak house buying season is knowing the market. Since the home-buying season can differ from market to market, its best to partner with the best real estate agent Scottsdale has to offer! The Jeff Barchi team will help you navigate through current real estate data and the unique characteristics of the market you’re interested in. Many hot weather areas like Arizona are impacted by the “snowbird effect.” Essentially, this means that many interested buyers will flock to these areas during the winter months to relocate or purchase a second home.
- Know the factors – There are additional factors that will impact your home buying season like the school year cycle and holiday season. You’re probably aware that a large percentage of home buyers have children but you may not know that 91% of home buyers consider school boundaries to be a determining factor in whether or not they buy or sell a home. Typically, families wait until the school year is over to make the move so as to not disrupt their child’s schooling. This group varies as well. Some families are looking to move to great school districts and others want to avoid high taxes and young demographics. To determine if a particular school district is right for you, do your research on school attendance zones, school success records, and residential demographics.
The holidays are a busy time. You’ll be preoccupied with last-minute shopping, guest lists, entertaining in-laws, and cooking amongst the many other things on your to-do list. The last thing you want to worry about is moving to another home while tending to your family obligations. The period between November and January is usually the slowest since many other home buyers are in the same boat.
How Has COVID Impacted the House Buying Season?
Let’s face it, the COVID pandemic has had a major impact on global financial markets including the housing market. The biggest home-buying season impact has been lowered mortgage interest rates. Since the beginning of the pandemic, the Federal Reserve has slashed interest rates twice. However, credit is more challenging to obtain right now. Many banks are requiring higher credit scores and larger down payment to secure a home. Demand remains steady for homes but the coronavirus has led to changes in purchasing decisions on short notice.
Leading up to the pandemic, the housing market was pretty tight. Prices in many areas have since risen dramatically due to high demand. Another factor to consider is that as the stock market drops, investors are looking for stable wealth vehicles and housing is always a durable option. Regardless of the ongoing pandemic, housing remains an attractive and steady investment even in times of crisis. Still, there are a couple of things you should consider while buying at this time:
- Drastic change – Since the coronavirus pandemic began in the spring of the home buying season, the normal buying and selling frenzy has changed drastically. While mortgage rates are incredibly low, new details about the pandemic indicate that the impact can be significant and far-reaching. Prolonged mortgage payment suspensions can potentially result in liquidity challenges where lenders don’t have the funds to give to homebuyers. The absence of subprime and specialty mortgages has led to higher credit and down payment requirements. On the other hand, if the pandemic damage to the mortgage industry is limited, the housing market could recover relatively quickly by hampering demand. This will lead to fewer people in the market and less competition for homebuyers.
- Housing recovery – Shelter in place orders are determined by the progression of the coronavirus. The housing market will coincide with these orders and will not return to normalcy until they are lifted. Although many reports have attempted to forecast the housing market recovery, data has indicated that page views on popular house hunting sites like Zillow have gradually increased to pre-pandemic levels. This clearly indicates that the demand for housing is still very present. Still, since home sale timelines usually last a few months, recovery should be expected to be gradual.
In an ideal world, the home buying season is a good time to buy a house. In the real world, it may not always work out that way. If you’re buying, you may be selling as well. While finding the timing to sell the house is relatively easy, formulating the next steps to buy a home may be more complex. If the funds aren’t needed to purchase a home, buying in the winter and selling in the spring may be a better option. Buying during the winter months or creating a short term housing arrangement like leasing, AirBnB, or moving in with others may be the ideal option. Waiting until the spring to make a home purchase will maximize the investment of the home your selling and the home your buying.
Call the Best Real Estate Agent in Happy Valley AZ
When is a good time to buy a house? It has more to do with the homebuyers’ preferences and comfort levels than seasons. While the spring and summer months are the hottest and most competitive for home buying season, it may not be the best time for you. For price-sensitive home buyers, January is an ideal time to score a great deal on a house because competition is low and sellers reduce prices to sell fast. Remember, the more time a home sits on the market, the more negotiating power you have. Prices tend to peak during April but the fall signals the end of the busiest home-buying season. This may also be an opportune time to score a deal on the purchase of a new home. Home prices tend to drop around this time because homeowners are forced to revisit their home selling strategy resulting in dramatic drops in price points. Knowing when to buy a home really depends on you.
Still have questions? For over 20 years, Jeff Barchi has been the premier real estate agent in Happy Valley AZ. Both award-winning and hardworking, our team leads Arizona averaging over 50 transactions a year. Homebuyers typically save an average of 5% on their purchase price compared to other homes. Sellers generally experience a 40-day turnover, compared to the state average of 87 days. This means that we can cut your selling time in half.
If you’re ready to take those next steps, call us and we’ll do the rest!