How To Buy A House And Save: Do It In February Or March

How To Buy A House For Less: Colder Months Can Save Cold Hard Cash

They say time is money. And if you want to know how to buy a house for less, new research suggests that your timing is perfect.

Curious what time of year yields the best bargains on homes for sale? It’s right now, says a new ATTOM Data Solutions report. February and March rank as the first and third best months to claim the biggest discounts, with January placing second.

What The Research Found

The report reveals that homes in February sell at a price per square foot that’s 6.1 percent less than the rest of the year, on average.

Unpublished data provided by ATTOM Data Solutions show that seven of the top 10 days of the year with the largest discounts fall in February, too: February 7, 4, 5, 12, 11, 6, and 3, respectively.

These seven days produce a discount of between 12.1 and 9.7 percent. The median sales price in February is only $168,000 versus $180,980 for all months, on average.

Yes, February is well underway and remains the year’s shortest month. And January is gone, when an average discount of 5.6 percent could have been had.

But don’t panic: nice deals can be had in March, as well.

In fact, homes sold in March tend to sell at a price-per-square-foot discount of 3.6 percent compared to the rest of the year, on average. The best days in March to score the biggest discounts are the 5th, 6th, 13th, 12th, and 4th — when prices are reduced between 9.6 and 7.4 percent.

March’s median sales price is merely $169,900.

What The Findings Mean To You

The biggest takeaway from this analysis? Real estate savings are seasonal.

In other words, get an early start. January, February, and March are the months in which the median price per square foot is the lowest of the year.

“Also, not every month or day is created equal when it comes to buying and selling. Both buyers and sellers should keep this in mind when deciding when to purchase or list a home,” says Daren Blomquist, Senior Vice President for ATTOM Data Solutions.

Blomquist says February and March yield the best deals because there’s less competition from other buyers during these months. What’s more, sellers are motivated — not wanting to wait until spring or summer to sell.

These factors combine to help drive down prices, and give buyers more of an advantage.

Why February And March 2017 Matter

But beyond these seasonal factors, there are other conditions that make the second and third months of this year buyer-friendly.

First, the recent uptick in interest rates has priced some potential buyers out of the market. Second, uncertainty currently exists about the real estate market and overall economy, as the new administration takes over.

Third, “We typically see an uptick in distressed share of sales seasonally early in the year,” says Blomquist. “After the holidays are over, banks – much more so than other buyers – are interested in unloading their inventory of distressed properties quickly. This provides a higher share of discounted properties on the market during this time of year.”

ATTOM Data Solutions’ data showed a spike in foreclosure starts and scheduled foreclosure auctions in October 2016. This was actually the biggest month-over-month increase since before the end of the Great Recession.

“We’d expect to see that spike translate into an even bigger seasonal increase than usual in distressed sales early this year,” Blomquist adds.

Time Is Of The Essence

The moral to the story?

“In this strong seller’s market, buyers need every advantage they can get,” Blomquist notes. “Going against the grain to buy when few others are buying is one way to gain at least a slight advantage.”

To land the best bargains this late winter and early spring, you’ll need to hustle. Beat the spring crowd by hunting for homes early and making an offer somewhat quickly – after you’ve done your homework, that is. And tough out the elements, despite weather challenges that occur this time of year.

“Also, be willing to consider distressed sales. That could mean going to a foreclosure auction, which is often called a trustee’s sale or sheriff’s sale,” says Blomquist. “This may seem intimidating, as you are typically bidding against real estate investors, but it can be done.”

Lastly, look at bank-owned properties that may not be in mint condition, but which may sell at discounted prices, he suggests.

What Are Today’s Mortgage Rates?

If you’re wondering how to buy a house in the wintry months, be happy that the mortgage market is also still cool. Current mortgage rates are still low — yet another reason to buy before the weather and the competition for homes heats up.