January, February are the two best months to purchase a home
According to Inman, article here and research using realtor.com data indicates that buyers would be wise to find a home before spring.
Near year, new home?
The Nerdwallet team, says January and February are the best two months to purchase a home, due to less competition, lower home prices and higher interest rates looming.
Take Advantage of the Savings
According to data, January and February have an 8.45% lower sales price than in July and February - the two most popular home buying months. With higher interest rates looming, buyers could feel like it is much more expensive than 8.45%.
The trend is likely to hold true in 2017 says Chief Economist Jonathan Smoke, but savings are likely to not be as drastic. The 2016 fall housing market was extraordinarily strong, meaning sellers didn't feel the pressure to lower the price in order to get their home off the market.
Despite this, Smoke says to take all the savings you can get, which could be meaning purchasing a home sooner and locking down a lower interest rate.
Colder Weather keeps the competition inside
In Minnesota on average, buyers are paying a 14-15% premium while buying a home in the Summer versus the Winter, while home sales drop by over 50% in the Winter.
Buyers are still fighting low inventory, although less buyer competition helps to offset the the issue.
For the savvy buyer and agent, this can lead to tons of savings, as the median home sold for $207,500 in February versus $242,000 in July of 2016. Score!
Higher Rates Ahead
Out of the three reasons to buy a home now, potential home-buyers are most concerned about the recent rise in interest rates, which have been predicted to rise to 5%.
"As we look toward spring and later in 2017, that's another reason to buy in January or February" said Smoke. "Because rates are expected to be about 50 basis points, or a half of a percent, more as the year goes on."
Key Takeaways:
Key Takeaways:
- Nerdwallet and Realtor.com Chief Economist Jonathan Smoke says January and February are the best months to purchase a home, to find the best deal.
- Interest rates are expected to keep increasing throughout the year, which are expected to reach 5%.
- The median home sold in January sold for $7,003 less than the listing price, and home sales drop by 47 percent.
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