Once the days get shorter and the summer comes to an end, the housing market tends to slow as buyers and sellers both go into hibernation until spring.
But autumn is actually a fantastic time to purchase a home. If you have clients who are considering buying their first house or moving up, here are six reasons that might get them off the fence and take the home purchase plunge this fall.
In fall, considerably fewer people are in the market for a home, which equates to less competition and minimizes potential bidding wars. This affords autumn house hunters an edge up on their offer being accepted as well as reduces the stress of multiple bid situations.
Sellers more motivated
Although there are fewer homes on the market during autumn, Realtors know that those who are selling are extremely motivated. With a reduction in the number of buyers, sellers tend to be more willing to negotiate, especially if open-house and showing activity is slow and multiple offers aren’t pouring in.
As such, you can negotiate your buyers a great deal on a home that may have sold for tens of thousands more dollars a mere six months earlier.
More attention from their Realtor
During spring and summer, Realtors are normally juggling the unique needs of multiple buyers and sellers. Potential homeowners benefit during this off-peak season as their agents are able to dedicate more time and attention to their clients and their house-hunting search. This can make the experience more enjoyable and less stressful for all.
Interest rates are still low
Currently, mortgage interest rates remain low, but rumor has it that the Fed will begin raising rates in 2016. If that is indeed the case, at some point next year, rates could be up half a percent or more, which equates to less buying power.
If your buyer borrows $600,000 now at an interest rate of 3.92 percent for 30 years, their monthly payment is $2,837 and the total cost of their mortgage is $1,021,280.
If the interest rate increases just half a percent to 4.42 percent, that same 30 year, $600,000 mortgage will cost $3,012 a month ($175 more) and $62,917 more over the life of the loan. This in itself is a great motivator for your clients to consider buying now while they’ll get more bang for their buck.
They’ll encounter less competition from other buyers, have more negotiating power and be able to take advantage of tax breaks.
Tax break advantages
Another financial incentive that might entice your potential buyers to purchase a home before the end of the year is that they’ll be able to take advantage of a variety of tax write-offs. For first-time buyers who comprise 25 to 30 percent of those purchasing a house during autumn, tax deductions such as mortgage interest, homeowners’ insurance premiums and property taxes may just help persuade them to make a move now rather than wait until spring.
Home for the holidays
What better gift is there than a house? Your buyers who purchase during early autumn can be settled in and able to celebrate the holiday season in their new home. For many, this is the ultimate way to celebrate the season.
If you have clients who are considering buying their first home or those that want to move up, let them know that autumn really is a great time to find the house of their dreams. In addition to getting more dedicated attention from their Realtor, they’ll encounter less competition from other buyers, have more negotiating power and be able to take advantage of tax breaks. And best of all: they will be celebrating the holidays in the comfort of their new home sweet home.
Gail DeMarco is an agent with Re/Max Gold serving the Bay Area and Sacramento.