The holiday season is right here with us and among the hustles of this season, home prices hibernate giving consumers a glorious chance to purchase a house. According to an annual analysis report by ATTOM Data Solutions, winter is the best season to buy a home. Autumn and winter are generally the best seasons to buy a house across almost every region in the united states.
As the holiday season kicks in, most of the buyers and sellers are already making plans and celebrating with their families, which means people who are in the market looking for a house are focused on other things, as a result, the competition during this time of the year is very low.
The analysis shows that only three days of the year offer discounts below the estimated market value- all falling in the month of December. Buyers willing to close on a home purchase deal the day after Christmas realize the biggest discounts below the full market value of any day of the year.
“Closing on a home purchase the day after Christmas or on New Year’s Eve can be one of the most financially beneficial holiday-season gifts you can get,” said Todd Teta, chief product officer with ATTOM Data Solutions. “While lots of folks are shopping the day-after Christmas sales or getting ready to ring in the New Year, our data shows that buyers and investors are buying homes in those days at a discount. That’s a far cry from buying during June when they are likely paying about a 7 percent premium.”
Best Months To Buy A House
Since the 2008 crash, the united states market has rebounded favorably. Assuming you bought a property at the lowest point of the recession and still own it, the asset has appreciated by 25% or even more. However, going by the trend, the housing market is expected to decline in 2020, which brings the question, when is the best time to buy a house?
Before we get there, most real estate experts agree that the main determinant when deciding what month to purchase a home is price. Buyers can refer to the following chart to see the months that had the best sales.
Data from the Federal Reserve Bank of St. Louis
For seasonally adjusted data;
|Month||Existing U.S. Homes
Sales Seasonally-Adjusted Annual Rate
Price at Closing
|Median Days on
|July 2018||5.39 million||$327,500||59|
|August 2018||5.35 million||$321,400||61|
|September 2018||5.18 million||$328,300||65|
|October 2018||5.22 million||$328,300||68|
|November 2018||5.10 million||$308,500||71|
|December 2018||5.0 million||$329,700||80|
|January 2019||4.93 million||$305,400||87|
|February 2019||5.48 million||$320,800||83|
|March 2019||5.21 million||$310,600||65|
|April 2019||5.21 million||$337,200||58|
|May 2019||5.36 million||$303,500||54|
|June 2019||5.27 million||$310,400||50|
Data from Federal Reserve Bank of St. Louis and US Census Bureau
The analysis of ATTOM data solutions looked at the best months to buy or invest in real estate at the national level. While December may be considered as the best month to invest in real estate, there is a 1.2% premium. However, if you are considering buying or investing in real estate during the summers, you can expect to pay a higher premium with June having the highest premiums at 7.1%.
Going by the states, Ohio realizes the highest or the biggest discounts below the full market value with -7.4% in January; Michigan with -7.2% in February; Delaware with 6.3% in February; Tennessee with -6.2 in January; and New Jersey with -5.8 in December.
|2013 to 2018 Sales of Single-Family Homes and Condos|
|Month||Days||Number of Sales||Median sales price||Median AVM||Premium Discounts|
December best days
On the other hand, an analysis by FitSmallBusiness shows that January is the best month to buy a home. Going by the data given in the Seasonally adjusted data table, January presents the best time to buy a home for the price-sensitive buyers.
In January, the median sales prices of homes are typically low, properties have been on the market for around 90 days on average, few people during this time are not in the market looking for a house, meaning less competition. The longer a home is on the market, the more room the buyer has to negotiate better and lower prices and potentially avoid a bidding war.
Worst Month To Buy A Home
April is the worst month to be looking for a home to purchase. The transition between spring and summer is the worst time to buy a home. Houses closing in April sell quickly and with a lot of competition, which drives up the prices. With a lot of inventory coming to the market, most buyers have no room to negotiate on the prices.
The shorter the property takes on the market, the more competition, steeper median sales prices and a higher percentage of homes selling make April the worst month to buy a house.
Most people consider the price to be the primary determining factor when purchasing a home, however, some shoppers are willing to spend more to get their ideal property, which means, for these shoppers, housing inventory matters a lot.
Spring and summer are the two seasons that usually bring the highest numbers of new homes to the market. A shopper with more houses to choose from, having a better chance of finding his or her ideal property in June and July because this is the period when new listings are at their highest, with a total inventory of 1.92 million to 1.93 million homes for sale.
New Listing & Inventory
|Month||New Listings||Total Inventory of Homes||Percent Monthly Inventory Increase|
|July-2018||313,000||1.92 Million||Starting Inventory|
|August 2018||322,000||1.91 Million||0.52% decrease|
|September 2018||326,000||1.88 Million||1.58% decrease|
|October 2018||335,000||1.85 Million||1.60% decrease|
|November 2018||341,000||1.74 Million||6.12% decrease|
|December 2018||348,000||1.53 Million||12.84% decrease|
|January 2019||349,000||1.59 Million||3.84% increase|
|February 2019||340,000||1.63 Million||2.48% increase|
|March 2019||331,000||1.67 Million||2.42% increase|
|April 2019||328,000||1.83 Million||9.14% increase|
|May 2019||332,000||1.91 Million||4.28% increase|
|June 2019||336,000||1.93 Million||1.04% Increase|
If you look at the seasonally adjusted data table and the new listings and inventory data table, you will notice a discrepancy in the U.S. existing home sales and the total inventory. Total inventory is based on a month-by-month analysis, while the existing home sales are based on a seasonally adjusted annual rate.
Adjusting data makes the neighboring months easy to compare and to see seasonal movements in the direction of the U.S. existing home sales.
Is 2020 a good year for investment?
Most experts agree that the United States economy may be headed for another recession, including the housing market, making it a buyer’s market. Research by Zillow shows that 2020 and beyond will be the best time to buy a home.
Here at The Power Is Now we continue to bring you the latest developments in the real estate market. We are committed to making sure that you are updated with what’s happening around you. We have partnered with First Bank to provide the products and programs that First Time Homebuyers need to buy a home now because tomorrow it will be even more difficult. Go to www.neverrentagain.com and get started today.
Eric Lawrence Frazier MBA
Vice President and Mortgage Advisor of First Bank
President and CEO of The Power Is Now Media Inc.