Now that Thanksgiving has come and gone, many people are diving head-first into the holiday season, perhaps taking some time off work, attending special gatherings, and preparing for the New Year. Despite all of this going on, could it be the right time for you to buy a new home?
Whether you must to relocate for a new job or you want to move while your children are on vacation from school, late November and December can be a surprisingly productive time for home buyers. Even though it’s a seller’s market for many areas, there are some great values to be found during the winter season.
We chalk it up to four reasons:
1. Less market activity means fewer buyers.
As mentioned before, there are a lot of commitments during the holiday season: parties, visiting family and friends, and perhaps more work responsibilities. However, if you find a house that you’re strongly considering, there are probably fewer buyers to compete with because they have the same seasonal commitments, too. There’s a lower possibility of a multiple-buyer situation that could push the seller’s initial price upward.
This is especially the case if you start early enough and know what you are looking for. You won’t be rushed into a decision or weak bargaining position by other buyers.
2. If a seller can’t wait until Spring, prime real estate season, he or she usually has a strong motive to sell.
The seller might need to relocate for a job, they might be experiencing a divorce, or they might need to sell their home for some other financial reason. If their home has been languishing on the market, this might also motivate them to sell by whatever means possible.
When you make an offer on a house during the holiday season, be fair with sellers, but use their need to your advantage to bargain for a lower price or any other concessions you might want. An example is to ask the seller to pay part of the closing costs.
(For the most part, home prices will be lower during the holiday season, unless you’re buying a home in an area known for winter living – say, a ski resort or an area that attracts “snowbirds” who travel to warmer winter residences from November to March.)
3. Many motivated sellers will want to close as fast as possible before holiday activities really ramp up or before the end of the year.
Sellers are not the only ones to want to move fast. Many real estate agents would like to receive their commissions and concentrate on their own holiday celebrations. And lenders would like to wrap up their books well before the end of the year. In the case of lenders, there aren’t that many people applying for loans at this time of year, so you could be fortunate and receive a faster approval than at any other time. (However, it depends on how fully-staffed the lender is. If the lender has a small staff in the first place, approval might not be as fast.)
4. There are changes in taxation to adapt to before April 2019.
There have been a few changes for homeowner taxation this year, particularly in more expensive coastal markets. By buying well before the April 15th tax deadline, you’ll set yourself up for being able to deduct your mortgage interest payments and your property taxes. You’ll also have more time to consult an expert to find other places to reduce your tax bill or increase your tax refund.
(Don’t forget: New tax laws enacted earlier in 2018 cap the property tax deductions on the state and local level to $10,000. These laws also allow only a $750,000 deduction on mortgage interest, instead of $1 million. Luckily, there were no changes to home sale gain exclusions of up to $500,000 for those who file jointly.)
Reluctant to search for a home in this holiday season? Don’t be.
There’s one last perk of looking to buy during the holidays: most people are in the holiday spirit, meaning that they strive to be more positive in general. The home-buying process is already stressful, so it’s a relief when people are more helpful during the holidays.
It might seem counter intuitive, and depending on how hectic your holidays are, a home search might pose a major inconvenience to your celebrations this year. However, if you are willing to try, it’s possible to find a great value and still be done in time to celebrate the rest of the holidays. It’s possible that you’ll be able to start 2019 in a new home!
Are you looking to buy or sell your home this season, with little fuss? Contact us today.