Six Ways to Save Money by Buying a Home during Winter
Not many people consider house hunting and buying a home during the busy months that their families are in town celebrating the holidays. The holidays are typically a time to relax, eat amazing meals, and ring in the New Year. However, if you are up in the air about whether or not you should put your house hunting on hold until after New Year, you could be doing yourself a great disservice. Sure, house hunting during Thanksgiving and Christmas may not sound ideal; but, what better way to ring in the New Year other than in a brand new home that you got a great deal for?
All My Sons Moving & Storage Boulder is a seasoned moving professional. For over 20 years our Boulder movers have been moving families to and from the area and, as every mover knows, the prime moving months are during the summer. Since our moving family wants yours to have the best moving and home buying experience possible, we have dug deep into the depths of housing market research to bring you all of the ways that you can save money by buying a home during winter.
- Housing Availability – It is important to keep in mind when house hunting during the winter months of October, November, and December, that although the housing market is slower and can work to your benefit, slower also means less options. There is more of a variety of houses to choose from after the month of February; however, by buying a home during winter you are more likely to find a house that you like, which will be thousands of dollars less, and that will allow you to make a decision more carefully. During the winter, houses sit longer. This means that you have more time to make a decision on one of the biggest investments of your life. During any other season when the housing market is more aggressive, you may have five other buyers bidding on the house that you love, making it so you either get out-bid or you don’t bid fast enough. On average, properties spend a median of 35 days on the market. During winter months, the average is roughly 48 days. Once May rolls around, the average is 23 days on the market. When house hunting during winter, if you find a home you love, you can take an extra night to sleep on it and to mull over it more.
- Housing Costs – Depending on where you are moving to, you can research the housing trends for that area. For Boulder, in 2015 the months of April, May, and June saw median housing prices (of houses sold) for three-bedroom homes reaching $624,500. During the months of July, August, September, and October the average three-bedroom home sold for $585,000 – a decrease of $39,500 in just three months’ time. In continuation, during the months of October, November, December, and even January that price will continue to drop. When it comes to buying your dream home and getting approved for a mortgage loan, that difference of over $35,000 can have a major impact on the type of home you can buy, the area you can reside in, your loan amount, and therefore your monthly mortgage payment.
- Contingencies – Since houses tend to sit on the market longer during winter, the process is more relaxed and traditional. During any other season you may feel extra pressure to put in your offer and close the deal, causing you to waive safety nets like home inspections. On the other hand, during the winter you don’t have to sacrifice the luxury of complete home inspections before you close.
- Tax Credit – As long as you close on your home before December 31st, you can still use it toward that year’s tax deductions. The normal allowable deductions will be the points, interest, and property taxes that you pay. A “point” is the fee that represents 1% of your loan amount, and the amount of points that you pay will vary depending on your lender. This is referred to as your “nonrecurring closing cost” and you can always speak with your lender on how to file taxes properly, or with a tax specialist once you receive your 1099.
- Prorated Interest – Prorated interest is one of the greatest perks to buying a home during winter. It is always best to set your closing date for the end of the month, but setting it for the end of the year is pure genius. If you put in an offer on a home and you choose your closing date to be Christmas (or the day before or after if Christmas is not a selectable date), you will only have to pay interest from Christmas through New Year’s. You will receive a 1099 from your lender when it comes time for you to file taxes for the year and it will illustrate the prorated amount.
- Moving Costs – Last, but certainly not least, moving can cost a fortune depending on the distance. Moving is always more affordable during the winter months. Prime moving months are May, June, July, and August because children are out of school and it is easier for families to transfer their children to new schools before the start of the academic school year. On the other hand, moving during the summertime can be draining due to the summer heat. Moving companies tend to be swamped and even overloaded or double-booked for moves – making your move less of a priority. High demand equals higher costs. In order to save even more money on your move and the entire home buying process, Boulder moving companies have a dwindling demand during winter months and can give you a better price, as well as better quality service.