Most markets are cyclical in nature. In practical terms, this means that there are periods when the market in question is very busy and periods when it is very slow. Many people are surprised to learn that this also applies to the real estate market.
Buying a home on a seller’s market is difficult. On the contrary, buying during a slow market is an incredible opportunity. You have the opportunity to enter at or near the bottom price floor. If you can stay focused on the future, you can really make a killing. Yes, you may see your home value drop a little more, but the key is to focus on 2010 and beyond. That may seem like a long way off, but the real estate market will recover and be back to its typical highs by then. This is where millionaires will be made.
Since you have seen the cyclical nature of a seller’s market versus a buyer’s market, you can see the power to buy or sell in each of these markets. Well, the good news is that there are actually busy and slow times within each calendar year.
Almost all real estate markets can be timed year after year. A classic perfect time to shop is during the winter holidays. Why? Well, think about it. How many people are looking for houses on Christmas or New Year’s Eve? Not many. This creates an artificial buyer’s market because the number of buyers interested in purchasing a home is greatly reduced. This period usually lasts from November to February.
Given the rather cold nature of winter, it is not surprising to learn that the real estate market is slow during the winter months. You might be surprised to learn that the same thing happens when things get hot. Specifically, the real estate market tends to cool down from July to August. Why is this? Well, families tend to go on vacation and get caught up in dealing with the kids. There is little time to search for a home and real estate markets tend to slow down, making them the best time to buy.
Location may be the number one rule of thumb for real estate, but it’s also important to know when to buy. It can make the difference between getting a great deal and buyer’s remorse.