Most markets are cyclical in nature. In practical terms, this means there are periods where the market in question is very busy and periods where it is very slow. Many people are surprised to learn this also applies to the real estate market.
Buying a home in a seller’s market is tough. In contrast, buying during a slow market is an incredible opportunity. You have a chance to get in at or near the bottom floor of prices. If you can keep focused on the future, you can really make a killing. Yes, you might see the value of the home drop a bit more, but the key is to focus on 2010 and beyond. That may seem a long way away, but the real estate market will bounce back and have returned to typical highs by then. This is where millionaires will be made.
Since you’ve seen the cyclical nature of a sellers’ market versus a buyers’ market, you can see the power of buying or selling during each of these markets. Well, the good news is there are actually busy and slow times within each calendar year.
Nearly every real estate market can be timed year after year. A classical perfect time to buy is during the winter holidays. Why? Well, think about it. How many people are out looking for homes around Christmas or New Years Eve? Not many. This creates an artificial buyers’ market because the number of buyers interested in purchasing a home is greatly reduced. This period usually lasts from November through February.
Given the rather cold nature of winter, it is hardly surprising to learn that the real estate market is slow during the winter months. You might be surprised to learn that the same is true when things heat up. Specifically, the real estate market tends to cool off from July to August. Why is this? Well, families tend to head off on vacations and get caught up in dealing with the kids. There is little time to house hunt and real estate markets tend to slow down, which makes them prime buying time.
Location may be the number one rule for real estate, but knowing when to buy is important as well. It can make the difference between getting a great deal and buyer’s remorse.