August 28th, 2018 8:51 AM by Jackie A. Graves, President
Buying a home
in the spring and summer these days looks like something you’d see out of “The
Hunger Games.” For sellers, it’s the golden opportunity to get the most return
on their real estate investment. Buyers, on the other hand, might feel like
they’re in a gladiator ring.
A lack of
affordable homes in many markets, along with fierce competition, rising prices
and higher mortgage rates, have sidelined many
buyers this year. That was evidenced in July by a continued slump in
existing-home sales, which crawled to their slowest pace in two years,
according to data from the National Association of Realtors.
fades to fall, though, recent market shifts could give buyers a leg up in the
latter part of the year. In July, for instance, the national inventory of homes
listed above $350,000 rose 5.7 percent, according to new data from Realtor.com.
The inventory swell is mostly in markets that have seen continual price growth
that’s starting to decelerate. In fact, 16 major housing markets had a
year-over-year increase in their inventory levels, Realtor.com found.
changes, along with less buyer competition and sellers eager to get to the
closing table before the holidays, could give serious buyers more latitude,
says Danielle Hale, Realtor.com’s chief economist.
no mistake: It’s still a sellers market in many places, but we’re starting to
see the tide shift,” Hale says.
Fall and winter give buyers more negotiating power
with children tend to abandon their homebuying plans by August because they
want to be settled before school starts. National housing data shows that
August and September tend to have the most drastic price reductions of any time
during the year, Hale says.
there’s less inventory in the fall than in the spring, buyers can often get
better deals on what is available. Fall is a last-ditch opportunity for sellers
to close on their homes before the end of the year. And with fewer buyers
coming through the door, sellers tend to price their homes more aggressively to
get buyers’ attention, says Bill Gassett, a real estate agent with Re/Max
Executive Realty in Hopkinton, Massachusetts.
from nabbing a better price, you might also score more flexible terms in the
fall, such as an extended closing time, or home inspection repairs or credits,
Gassett says. The longer a home sits on the market, too, the more willing a
seller will be to negotiate, he says.
November sets in, substantially more buyers and sellers drop out of the market.
The odds of finding a home become much slimmer because inventory levels
typically plummet further in November and December, Gassett says. You can use
that lull to your advantage — and gain the upper hand.
who can’t wait until the spring to sell are even more motivated (in the
winter),” Gassett says. “The weather isn’t nice, people are celebrating the
holidays and no one wants to move during that time.”
To narrow your buying window, look at local data
saying “all real estate is local” isn’t just a catchy mantra; it’s rooted in
fact. The best time to buy (or sell) in your area depends on its supply and
demand, as well as local seasonality, climate, economic conditions and
“When demand is
low and supply is high, there’s an opportunity to pounce,” says Jay Phillip
Parker, CEO of Douglas Elliman Florida Brokerage. “Buyers can’t control supply,
so they have to look for periods of low demand.”
periods of demand can vary from market to market. Buyers should ask their real
estate agent to get granular with local market data to help them figure out a
more precise window for scoring a good deal.
Here are some
important questions Parker suggests you ask:
that buyers have more leeway in negotiations during off-peak times, but says
that asking for too many contingencies can still be a deal-killer. Buyers
should always get a home inspection to identify major
issues, but there’s a much bigger picture to consider, Parker says.
better off focusing on price,” Parker says. “Once you know what you’re buying
and you know you can afford it, the most important thing is price.”
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