Wondering when the best time to buy a home is? And the worst time? Well, thanks to data science, we no longer have to guess whether it’s fall and winter, or spring and summer.
I’ll save you the suspense: the very best time to buy your dream home is late summer, namely August and September, this according to a new study from real estate listing website Zillow.
Apparently prospective home buyers will find the most home inventory and a greater number of price cuts during these temperature-hot months, giving them better odds of finding that perfect home.
This means it might be easier to negotiate prices and perhaps even snag a lower price if the property stays on the market for a prolonged period of time.
- An inventory glut in late summer
- Could be the perfect time to buy a home
- Because home sellers will be getting desperate
- And there might be fewer competing buyers at that time
As you probably know (if you’ve been house hunting), inventory is scarce. It’s slim pickings out there and hasn’t gotten any better, despite predictions telling us otherwise. They were wrong about mortgage rates going up too…
Overall, inventory is off 5.3% from a year ago, meaning you’ll have to buckle your seatbelt and prepare for another tough year if you’re in the market to buy a home, or getting ready to be. Real estate investing is also getting a lot less attractive, and not so easy.
Conversely, if you’re a seller, you don’t even have to clean your house, make the bed, or mow your lawn – it’s already sold!
Okay, maybe you should do those things to fetch a higher price, but the seemingly endless seller’s market persists.
However, there are some house hacks (pardon the awful, awful buzzword) to increase your chances of landing your dream home.
Zillow found out that in most major metros, the month of August featured more for-sale listings than any other month during the year.
For example, last year in Los Angeles there were about 8,000 more homes for sale in August than in April. The total number of homes for sale increased from 26,000 to 34,000, a major 31% increase.
The same trend was found in many other metros, from Detroit to San Francisco, though not all of them.
However, it wasn’t just inventory that improved. Competition also went down in late summer, so even if fewer homes were on the market, there were fewer buyers chasing them.
Conventional logic tells us that many would-be buyers want to get situated well before summer ends to ensure they can get their kids enrolled in the new school. They may also be taking family vacations during late summer.
It’s also just plain hot in some parts of the country, which might affect buyer traffic and seller motivation, regardless of market conditions.
- As time goes on and desperation grows
- Home price reductions might become more prevalent
- Which leads to opportunity
- And the potential to negotiate even lower!
With more homes and fewer prospective buyers comes price reductions. After all, the business law of supply and demand will dictate a homes price, and if fewer people are chasing more homes, the sales price must down come.
Zillow discovered that 15.1% of active real estate listings had a price cut in August, significantly higher than the 12.8% of homes in April.
That increases your chances of finding a home on sale, assuming the starting points (listing price) were relatively similar. September was also a good month to find a deal, with 14.3% of homes on sale, so to speak.