4 reasons to buy a home during holidays
A home that's on the market during the holidays may mean that the seller is more motivated to sell, allowing room for buyers to negotiate price and other contingencies. And since business across many industries tends to slow toward the end of the year, buyers may find it easier to get away from work to see houses. Meanwhile, real estate agents who typically experience their busiest seasons in late spring and summer will have plenty of time to devote to showings.
Whether you’re a real estate investor or simply a savvy home buyer, here are four ways to use holiday home buying trends to your advantage and secure a great deal
Lower Competition
If there’s one undeniable truth about the holidays, it’s that real estate inventory is limited during the holiday months. There’s simply less real estate activity — less people selling less homes — during the holidays.
To compound this fact, there are fewer mortgage lenders, realtors and inspectors available than usual. But rather than seeing this as a major obstacle, this can add up to a huge advantage for home buyers during the holidays: less competition. If you’re able to find a property, there’ll be a lot less buyers — and the strong possibility that you’ll negotiate a favorable price that can put additional savings in your pocket.
The power of a motivated seller
Webster’s Dictionary defines “leverage” as the ability to “use something to maximum advantage.” And when it comes to buying real estate during the holidays, there may be no bigger form of leverage than the motivation of sellers.
If someone is selling a home during the holidays, chances are, they have a compelling reason to do so. This can be for a variety of reasons: impending job relocation, unexpected event in the family, the desire to be in that new 3,500-square foot house by Christmas.
This is doubly true if the property has been on the market for awhile, or is an “old expired listing,” in which the property was on market years ago — but did not sell on time during the length of the listing.
Private sellers are not the only entities motivated to sell during the holidays. Financial institutions are often motivated to get foreclosure properties “off the books” before the end of the calendar year.
Tax benefits
This particular advantage will, obviously, depend on your particular financial situation, and what your tax liability looks like for the current calendar year. But closing on the purchase of a property, in the waning months of a year, can give you major tax advantages heading into the following year.
If you itemize deductions, then you might be eligible, with the purchase of a home, to deduct things like points paid upon closing, property taxes and mortgage interest rates. If you’re buying the house as an investment asset, and have a business entity set up, then there are even more tax benefits available to you.
Again, this depends on your particular tax situation for that year; certainly you wouldn’t want to do a deal simply for tax benefit. Oftentimes added tax benefits, from the purchase of real estate, can give you flexibility when it comes to coming up with your final, best offer on a property.
Faster closing
Home sellers aren’t the only motivated folks involved in the home buying process during the holiday months. Lenders, brokers, realtors — even inspectors — are often motivated to get a deal done before the end of the year.
This can bring welcome focus and speed to a process that can take longer in non-holiday months. Most parties involved in a home buying transaction have incentives to finalize the deal as soon as possible. Lenders want to close their books, agents want their commission, and sellers want to, frankly, move on.
The key, as with many things in life, is communication. Speak with agents and lenders as far in advance as possible to find out exactly when individuals you depend on to complete a deal are “on the clock.” Though there are few true “off-days” during the holidays, this doesn’t mean there aren’t other internal demands folks needed to close out a real estate deal.
Respect the time constraints of the other parties involved in your real estate transaction, and you might just find a grateful (if not speedy) resolution to your deal.
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The bottom line
You might soon be noticing your neighbors taking down “For Sale” signs and putting up Christmas lights instead. The holidays are typically the time when buyers and sellers take a break and regroup for the new year. But there are several reasons why staying active during a seasonal slowdown can be to your advantage.