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The best time to buy a home

Just like the changing leaves of autumn and rising temperatures of summer, real estate follows seasonal trends. If you’re in the market for a new home, there are times of the year that may be better for buying than others. By timing your purchase, you’ll find more homes to choose from or sellers who are more willing to make a deal. Check out the factors that play a role in the best time to buy.

The best month to buy a home

According to the National Association of REALTORS® (NAR), October is the best month to buy a home. Specifically, the first week of October is when market conditions most favor buyers. “Inventory tends to be high, prices are below peak levels, demand is waning, and pace of the market slows to a more manageable speed.”

RealtyTrac’s analysis of 32 million homes also found that buyers get the best deals in October. “Of the 2.7 million sales closed in October over the last 15 years, the average sales price was 2.6 percent below the average estimated full market value at the time of sale.” February, July, December and January follow October as the best months to buy.

It’s important to note that the best month to buy a home may vary depending on your location. For example, seasonal inventory and pricing patterns could be less noticeable if you’re looking to move to an area with a more moderate climate.

Factors that affect the best time to buy a home

More goes into finding the best time to buy a home than just researching the month with the lowest price. Consider the following factors:

  • 1. Availability

    If you’re looking for the widest selection, housing inventory is usually highest in late spring and early summer. But be prepared to pay a bit more. An analysis by the real estate website Zillow found that, “Listings that hit the market in early May sold for almost 1% more than expected or roughly $2,100 more on the nation’s typical home.”

  • 2. Competition

    During the spring season, you may face stiff competition from other buyers. You’ll need to act quickly to make an offer and get your bid in early. To give yourself a leg up, get pre-approved for a mortgage ahead of time. In a competitive market, it can be valuable to show sellers that you’re pre-approved to buy.

  • 3. Weather

    Traditionally, inventory is lower in the winter, and homes stay on the market longer. Although fewer homes will be available, this could mean you’ll find motivated sellers willing to make a deal. Research by ATTOM Data Solutions points to December 26 as the closing day with the most significant discount below market price—buyers purchasing the day after Christmas pay 1.3% less.

  • 4. Interest rates

    Many buyers think the best time to buy is when interest rates are low, but this can mean fewer houses on the market and soaring prices. Base your decision to buy a home less on interest rates and more on when you can comfortably afford the monthly mortgage payment. Use our mortgage payment calculator to understand all costs you’ll expect to pay on your loan each month.

  • 5. The holidays

    Sellers may be more likely to sell in the fall, so their homes aren’t on the market during the holiday season.

  • 6. School schedules

    There may be more homes on the market in late spring because some families with kids in school find it easier to move during summer break. Once school starts, they may be less likely to pick up and move.

What month do most homes go on the market?

Zillow’s data shows that new listings “bloom” in late spring. April marks the month with the most new homes listed for sale. The springtime trend continues in May and June. Those months have twice as many active listings as December and January. However, if you’re looking to buy in an area with a temperate climate, you may find less fluctuation in the number of homes listed by season.

When should you buy a home?

The simple answer is that a good time to buy a home is when you can afford it and are ready. Armed with the answers to the following questions, you’ll be in a better position to decide on your ideal time to buy.

  • What’s your debt-to-income (DTI) ratio?

    Your DTI is important because it reflects your ability to manage monthly mortgage payments and repay debts.

  • What’s your credit score?

    Understanding your credit score and taking steps to improve it are essential steps in the homebuying process.

  • Have you researched down payment options?

    You may qualify for local down payment assistance programs. DPA programs assist in the form of a loan or grant—secured as a lien against the property—that’s often forgiven over time.

  • Can you afford the monthly payment?

    The Guild affordability calculator can help you determine if your salary is in line with the income needed to qualify for the home you would like to purchase.

  • Have you been pre-approved?

    Pre-approval gives you confidence in your ability to get a home loan before you start shopping.

  • Are your finances in order?

    The number you get from the pre-approval process only tells you the maximum loan amount. To understand better how that translates to potential homes you can afford, it’s helpful to prepare for common expenses related to homeownership , such as closing costs, HOA fees and moving expenses.

If now is the best time for you to buy, Guild loan officers are standing by to lend a hand.

The above information is for educational purposes only. All information, loan programs and interest rates are subject to change without notice. All loans subject to underwriter approval. Terms and conditions apply. Always consult an accountant or tax advisor for full eligibility requirements on tax deduction.

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About the Author: Guild Mortgage

Founded in 1960 when the modern U.S. mortgage industry was just forming, Guild Mortgage Company is a nationally recognized independent mortgage lender providing residential mortgage products and local in-house origination and servicing. Guild’s collaborative culture and commitment to diversity and inclusion enable it to deliver a personalized experience for each customer. With more than 4,000 employees and over 250 retail branches, Guild has relationships with credit unions, community banks, and other financial institutions and services loans in 49 states and the District of Columbia. Guild’s highly trained loan professionals are experienced in government-sponsored programs such as FHA, VA, USDA, down payment assistance programs and other specialized loan programs. Guild Mortgage Company is a wholly owned subsidiary of Guild Holdings Company, whose shares of Class A common stock trade on the New York Stock Exchange under the symbol GHLD.