If you're in the market for a new home, you're probably wondering when is the best time to buy. Seasonal real estate patterns can have a significant impact on housing inventory and home prices, making certain times of the year more favorable for homebuyers. However, recent economic events have shaken up traditional trends, so let's dive into the best strategies for buying a house in 2024.
Discovering the Perfect Moment
Real estate data company ATTOM recently released a report that analyzed over 51 million single-family home and condo sales from 2011 to 2022. According to their findings, certain months offer better deals than others, giving buyers an edge in the market.
The Best Month to Buy a Home
In the pursuit of a good deal, one month stands out as the worst for buyers — May. After the winter months, May experiences a surge in demand and fierce competition among buyers, leading to bidding wars and inflated prices. On average, buyers in May pay a premium of 12.8% above market value.
On the other hand, November is the month to look out for. Buyers during this time pay the lowest premium of the year, around 6.3%. With less competition and motivated sellers willing to negotiate, November offers the ideal conditions for securing a great deal.
The Cheapest Time of Year to Buy
Fall and winter are traditionally periods of decreased home inventory due to shorter days, falling temperatures, and the busy holiday season. However, this time of year also presents an opportunity for buyers. Motivated sellers and fewer buyers result in better deals for those willing to shop during the off-season.
According to ATTOM's research, November, December, October, and January are the months when homes are least likely to sell at a premium. Buyers during these months can expect to pay premiums ranging from 6.3% to 7.5% above market value.
The Best Season to Buy
If having a wide variety of options is your priority, spring and early summer are the prime seasons for home shopping. During this time, housing inventory increases due to sellers eager to put their homes on the market before the next school year begins. The pleasant weather and flourishing surroundings make homes more appealing to buyers as well.
However, it's important to note that spring and summer are also the seasons when homes are most likely to sell above market value. May, June, April, March, and July have the highest premium rates, ranging from 9.6% to 12.8%. Bidding wars and increased competition can drive up prices during these months.
Factors to Consider
While seasonality plays a significant role in housing inventory and prices, there are other vital factors to consider before making a purchase. Housing market trends can vary from city to city or even within neighborhoods. If you're searching in a hot market, expect lower inventory and higher prices regardless of the time of year. It may require some compromise on your homebuying wish list to strike a balance.
Additionally, mortgage rates currently play a crucial role in the affordability of homeownership. With rates reaching higher levels, many potential buyers are finding it challenging to secure loans. This decrease in purchasing power has led to sellers being hesitant to leave their low mortgage rates.
Is It the Right Time to Buy?
Ultimately, determining the best time to buy a house depends on your readiness, both financially and otherwise. While considering seasonality is worthwhile, your ability to handle homeownership costs, maintain a solid credit score, and afford a down payment are vital indicators of whether it's a good time for you to purchase a home.
You should buy when your debt is under control, your credit score is in good shape, and you're confident in your ability to manage the various responsibilities of homeownership. By doing so, you can enjoy your new home, build equity, and still pursue other financial goals.
Frequently Asked Questions (FAQs)
When is the best time to buy a house in 2024?
For the best deals, consider waiting until late fall or early winter. During this time, buyers typically pay the lowest premiums above market value. However, if having a wide selection is more important to you, focus on late spring and early summer when many homes enter the market.
Should I buy a house now or wait?
Deciding whether to buy now or wait can be challenging. While buying now offers the opportunity to secure a home and start building equity, waiting might be beneficial if your credit score or finances need improvement or if there are signs of increasing inventory in your area.
Are home prices dropping?
Home prices vary across the United States, with some markets cooling down while others heat up. According to the National Association of Realtors, the median existing-home sales price in May 2023 decreased by 3.1% compared to the previous year. However, it's crucial to research your specific market to gain a better understanding of its dynamics.
So, when it comes to purchasing a home, understanding the dynamics of seasonality, market trends, and your personal readiness is key. By considering these factors and staying informed, you'll be well-equipped to make the right decision regarding the best time to buy a house in 2024.