Real Estate is a seasonal business much like the retail business. For retail businesses this is HIGH season and, traditionally, this is LOW season for real estate. People don’t want to move or focus on looking for property during this time of year. This could be a benefit to a ready, willing and able buyer. In fact, some of the best real estate deals I’ve personally made have been in December. So what are the reasons that great real estate deals can be found this time of year? Here is a list of things to keep in mind while you are looking and negotiating for property this December:
- Competition – The pool of buyers is smaller, “…more than 85 percent of buyers who say they plan to buy a home in the next year say they will wait until the spring or summer” according to a com survey. There are also stats that show first time buyers are less likely to be out looking this time of year which limits competition. You have fewer buyers that are buying on emotion, so there is less of a chance of properties having multiple offers and being bid up. All these factors make it more likely you’ll find a real estate deal you just can’t pass up.
- Proven stats – According to The Balance “…home prices typically drop to a 12 month low” in the month of December.
- Weather!! – In many parts of the country the weather starts to play a role. This can keep competition away.
- Motivation – Sellers who are selling a home in the winter tend to be more motivated to make a deal. According to Gibson Sotheby’s International Realty in Boston “…those who do choose to sell at year-end are often under pressure and highly motivated to cut a deal. A seller who’s looking to move a piece of real estate during the holidays is a seller who needs to sell, because nobody in their right mind would pick that as the most convenient time to list their property. And that is why the year-end might be a smart time to buy: Determined property-hunters can take advantage of sellers’ urgency.”
Expenses – In some states this is also the time of year expenses increase such as heating bills, property taxes, property upkeep and other utilities. These expenses can add up making selling more attractive.
- No Income – If the property is a rental and it is vacant, from Thanksgiving all the way to New Years it is often difficult to fill a vacancy. With no income and vacant unit(s) it might be a better option for the owner to accept a real estate deal that is less than ideal for them and move on.
- 1031 exchange- Rental property might also be a good buy because there are owners who are looking to 1031 exchange before year end. The sale must be booked on or before December 31st.
- New Start – On the positive side people are often in a good mood and may want a fresh start at the New Year so they just want to get the deal done and move on.
Everyone likes a good deal, and as a fix and flipper this is a perfect time of year to find a great real estate deal, make a purchase and have a project ready to go into rehab and be marketable for sale in the early spring.
Diana D. Hill – firstname.lastname@example.org