There are many reasons the Real Estate market doesn’t come to a screeching halt during the winter months. Clients have to move for jobs, families get bigger, or some are looking to make budget cuts. Either way, the great news about home shopping in the off-season is big savings!
This is especially true of homebuyers looking in major metro areas. According to an analysis by NerdWallet, sale prices decrease by an average of 3 percent in the fall months (September— November), showing Richmond as experiencing a 4.2 percent median decrease from summer to fall. The trend continues downward into the winter months according to the study, identifying February as the lowest median sales price month for the Richmond Metro area, dropping a whopping 9.5 percent.
While listing prices remain strong throughout the fall, it’s the sale prices that tend to take a dive. Fewer buyers on the market during the fall and winter seasons means that homes stay listed for longer periods of time, driving prices down. Many homes on the market, no matter what time of year, don’t always sell for listing price, the difference lies in the gap between sale price and listing price. During the summer months with a larger inventory and more competition, that gap is narrowed. The gap widening during off-season “[reflects] buyers’ increased negotiating power,” according to the study. There is an echoing philosophy throughout the real estate industry that the best time to buy is in the spring, however, depending on your goals, this may not be true at all.
Graph and Chart credit: Nerdwallet.com
Finally, if you are looking to buy a home and still aren’t convinced buying in the winter is the best move for you, consider current mortgage rates. Rates are still incredibly low, and not likely to be raised again before the end of the year. Taking advantage of current rates could work to your benefit, as they are not expected to decrease. Spring traditionally hails in the first rate hike of the year. More competition amongst buyers in spring means a higher volume of home loan applications at the bank. Winter is also the “off-season” for mortgage lenders and having more of their time could be to your advantage.
As an off-season buyer, there are so many different possibilities to take advantage of, ones that would be hard to come by once the Real Estate market starts heating up again.
For more information on this analysis and statistics in your area, click here.
WandaFears, Realtor ABR CRS GRI WCR
Richmond, Va. Long and Foster Realtors