Buying a home is usually a one-time investment. It is a high involvement decision that includes answering a number of questions like where, how, from whom and when is the best time to buy a house? Finding the answers to these queries will determine a lot of things about your future place of residence.
In this article, we will address a number of factors that come into play while buying a house. We will talk about the best and worst times to buy a house as well as other financial or other relevant aspects about making a purchase. It is important to understand the vitality of these factors so that you are able to obtain great value for money on the investment that you make.
The Best Months and Dates to Buy a House
Data collected from various sources reveals that best time to buy a house is late summer or early fall. Analytics from leading real estate platforms like Zillow, Realtor.com and Attom reveal that buyers looking to purchase a home at the end of summer have less competition and more choices. Since the demand is low, suppliers are willing to give significant price cuts on properties to people still searching.
The same reports that identify the best months for buying a house in August and September, also determine the best days for the purpose. The optimal day that has been unanimously pointed out by different websites is 26th December. That’s right, the day right after Christmas is the most opportune to find a good deal on a home. Other days according to Attom include Oct 12, Nov 9 and Dec 4, 7 and 29.
The Worst Months and Dates to Buy a House
The most preferable time for homebuyers is the season during vacations. With the kids out of school and holidays easy to get, most people opt for this time to move places. More precisely, spring and the first part of summer is the worst possible time to buy a home. Since demand is high during these months, prices tend to be more than what they would be in regular months making this a bad time to get a discount.
Pinpointing exact days is a gamble, especially when it comes to home buying. Still, data from various realtors indicates that the worst day to buy a home or close a deal for a house is the last Friday in May. The reason for this is the fact that a majority of home buyers are closing their deals end of May. It becomes a mad frenzy at registration offices and title companies don’t like that.
Despite the figures given by leading real estate agents and websites, everyone agrees that the best time to buy a house depends on a number of factors. For one, your location is a big element when it comes to knowing which seasons are going to be busy and which are not. Also, the discounts that buyers get on average can differ between states. This shows that as a buyer, you have to spend time researching your options before making a final decision.
How Far in Advance Should you Look for a House to Buy?
Home buying is a lengthy process even if you are not a picky buyer. Although you should be particularly when you know that you will be keeping the same house for, maybe, your whole life. Still, the answer to the question of when you should start looking for a house is subjective. There are chances you may fall in love with the first home you inspect, and there are possibilities that you don’t find anything even after months of exhaustive searching.
The average recommended time in advance to begin searching for a home is 4 to 6 months. This is ample time for you to find a reasonable place to move. Be careful though, don’t keep this timeline for actually moving into the new place. The home buying process involves first seeking a mortgage pre-approval, then comes the process of looking at listings. Once you have picked the home that you want, you have to begin touring properties through a realtor and then make offers, conduct inspections and then finally close a deal. This process can take even as long as a year or more.
Considering all these aspects, if you are serious about buying a new home, the time to start looking is right now.
Other Factors to Consider When Buying a House
The best time to buy a house is not the only element that one should factor into the home buying equation. There are other things that come into play like budgets, interest rates, economic indicators and a few others. Here we go through a few things that you should think about before setting out to buy a home.
The basic economic lessons of supply and demand dictate how markets operate. When the economy is doing good, incomes are high and people can spare a greater percentage of their earnings on a home. This drives prices up because the demand is high. Similarly, during a recession, demand is low and many people fall back on their mortgage payments. This is why economic conditions for now and predictions for the close future should play an important role in your decision making.
Markup rates drive up mortgage payments. These rates are different for each mode of payment available to homeowners. Homeowners who have large variable mortgages are most affected by interest rates. The 15-year loan is the most preferred method for buying a home these days but a 30-year fixed mortgage frees you from the risk of fluctuating interest rates. Contact your financial service provider in advance to discuss the options available to you.
At the end of the day, no matter what the economy is like or what interest rates are prevalent, the decision of which house to buy or whether to purchase one in the first place will depend on how much you can afford. This is why getting financial approval comes even before you start looking at listings for home. Once you get an approval, you know how much you can afford to spend on a house and this will determine everything else related to the place of residence too.
Down Payment and Mortgage Installments
Before the credit crunch of banks were pretty lenient in giving out loans. They even offered mortgages on no deposits at all. However, after the housing market collapsed, there have been strict regulations that govern mortgages and loans given out to individuals for the purchase of residential properties. The mix of down payment and installment percentage that a person gets approved for also determines the type of house that they can buy, thus bringing another element into the mix that needs consideration.
Other General Things to Bear in Mind
Besides the financial aspects and the best time to buy a house, there are other more general pieces of the puzzle too. These include the overall community in which the house is based, what features are available to residents, how secure it is and a lot more besides. Without deliberations on these, even a great house can become unlivable in the future.
It’s not just aesthetics that constitute a location but there are other things too. Schools, parks, ease of access for supermarkets and other important commercial areas are all part of the location. The climate, risks of natural disasters and pests or molds are all things that fall under the banner of location because they are influenced by the surrounding atmosphere and region.
Security is the top priority for many, especially when living with families. A secure, gated community is effective at keeping criminals at bay. This gives you the security to let your children play outside or take walks without fear. It is, therefore, crucial to ask around and investigate the crime rates and security features of the area surrounding the house before making a final decision.
Not just the house but the surroundings have to have basic facilities. What is included in this list can vary based on personal preferences but the availability of high-speed network connections, power and other amenities are a must in any space. The infrastructure of the home, its construction and its capacity to support fundamental as well as high tech features like smart gadgets should also be considered. Of course, these are all subjective things that depend on personal preferences.
Many people question about the best time to buy a house and thanks to available data, it is easy for them to get an answer but then all is not resolved. At least if you are looking to make a one-time investment in something for your personal use. Statistics show that September to December are the best months to get between 1% to 3% discounts on the purchase of your home but this period fluctuates based on different climates and a variety of other factors too.
It is recommended, therefore, that you conduct thorough research before buying a home because it’s not something most of us get to buy every day.