Top 5 Reasons Why You Should Buy a Home Now
The holidays are here, and there couldn’t be a better time for you to buy! The end of the year is by far the best time to jump on that new home purchase you’ve been thinking about. Below are the top 5 reasons why you should buy now vs. waiting until next year!
Home prices tend to decrease towards the end of the year, which means you can get that new home for the right price! During the “hot market” months (March to September), home prices tend to increase anywhere between 4-8%. That means you could pay up to 8% more for the same house if you wait! No one wants to pay more…right? Right! The reason for this is that most people don’t like to move during the holidays, so homes tend to sit on the market a little longer and the sellers want to sell. That opens the door for better negotiating on the sales price, and other benefits for you…the buyer. During the spring and summer months, families are focused on getting into that specific school district before the school year starts. That means more competition, and there’s a good chance you could get into a multiple offer situation. It’s all about supply and demand, and the demand is lower between September and February. This leads us to the second reason to buy now…
2. Less Competition
As stated above, competition and multiple offer situations can, and will, drive up home prices. The lack of competition is a HUGE advantage to you when buying a home. There is still plenty of inventory to choose from, but not as many people buying due to the holidays. Again…this works in your favor! You aren’t going head to head with 2-3 other potential buyers, so the seller is more inclined to work with your offer and finalize the deal. Of course there is still the chance someone else could put an offer in on the same house, but with the lower sales price you could still get the home for less than you would during the summer.
3. Less Taxes Owed at Closing
This is a big plus to you and can save you quite a bit at the closing table. Taxes are typically due in November, which means the seller has already paid their taxes for the year. What does this mean to you? I’ll explain…When you buy a home, you have to pay the taxes from the day of closing to the end of the year.
Example: Your closing day on your new home is on June 14th. At closing you will pay the taxes from June 14th to Dec 31st, and the seller will owe the taxes from Jan 1 to June 14th. Now if the closing date on the home was Dec 27th, you will only pay taxes from Dec 27th – Dec 31st! That means less out of your pocket at closing!
4. Homestead Tax Exemption
The Homestead Tax Exemption saves you money on your taxes every year. Every home owner can get this expedition, as long as the home you are applying for is your primary residence and you close before Dec 31st. If you do not close by year end, you can still get the tax exemption…you would just have to wait until the following year to apply. This tax exemption can save you hundreds on your yearly taxes! People save an average of around $500 a year on their taxes, which means a lower mortgage payment.
5. Low Interest Rates and Free Money!
You read that right…free money! I’ll explain that in a second…Mortgage interest rates are still low, but rumored to increase by year end/beginning of the new year. As to what they will increase to we don’t know, but a rate increase means more for your mortgage payment. With an increase in interest and the seasonal home price increase, by waiting you could pay between $100-$150 more a month for the same house!
Now to the best part…Free money! There many great mortgage programs that offer 100% down payment assistance! That means your 3.5% down payment is covered. The even better part? You don’t have to pay it back! It’s free money to cover the down payment, and in some cases some of your closing costs.