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Even though the weather is colder and the hustle and bustle of the holiday season is ramping up, there are still people who are interested in buying — and selling — their homes during the winter.
If you’re one of those people and you’re wondering what to expect, here are four predictions for the housing market this winter, according to experts.
What Homebuyers Can Expect This Winter
Here are some predictions from real estate experts for those looking to buy a home soon.
Less Competition Among Buyers
“Winter is typically considered the off-peak season in real estate,” said real estate expert and general contractor Chris Hock of Earth Saving Solutions. “However, this doesn’t mean opportunities are scarce; it could present some unique advantages for buyers.
Hock said that there might be less competition among buyers this winter. “Many people prefer house hunting in the warmer months so that you may have fewer bidding wars,” he said. “However, the flip-side is that there may be fewer houses on the market to pick from.”
More Room for Negotiation
Hock added, “Secondly, sellers who list their properties during winter are often motivated to sell quickly. This urgency could lead to more negotiable prices and terms. Buyers may find more room for negotiation during this period.”
What Home Sellers Can Expect This Winter
Here’s what you should expect if you’re planning to sell your home during the winter months.
Less Competition Among Sellers
“For sellers,” Hock said, “the winter market can be a double-edged sword.” Hock shared that while there might be fewer buyers, those who are looking for a home are often serious about purchasing.
“Fewer listings during winter mean less competition, which could work to a seller’s advantage. If your home is well-maintained and appropriately priced, it might stand out more quickly in the smaller winter market. I plan to list one in Arvada, Colorado, the first week of January; I’m focusing on ensuring the house is solid with a clean, quick remodel that only has a few inspection items for the buyers to worry about.”
Pressure To Price Properties To Sell
Hock pointed out that selling in the winter can also bring challenges. “Buyers tend to be more selective, and properties can be more challenging to showcase due to weather conditions and shorter days,” he said. “Therefore, it’s essential to price it accordingly. In the last house we sold in October, I fixed every one of the inspection items that the buyers asked for.”
Additional Insight and Advice for Homebuyers and Sellers
“The best deals are found around Thanksgiving and Christmas, so if you want to buy, NOW is the time,” stressed Hock. “I know interest rates are high, but you always want to remember that you are only dating the rate. Marry the house!
“Regardless of the season, the fundamental buying and selling principles remain the same. For buyers, it’s crucial to understand your budget and get pre-approved for a mortgage. Also, hire a reputable home inspector to ensure you aren’t surprised by any potential issues after purchase; I recommend bringing in a general contractor to price the items to help prove the costs.
“For sellers, setting a realistic price is critical. Overpricing a home can be problematic. Your best time is when you put it on at the right price and have several interested parties. Ensure your home is in the best possible condition before listing, and consider hiring a home inspector before listing and correcting the items on the list.”
What Will Happen With Mortgage Rates?
Rhett Wiseman, a real estate private investor and the founder of Wiseman Advising LLCwho owns and has invested in over 200 residential properties in the northeastern and midwestern markets, said he does not anticipate a rate decrease until at least Q2 2024.
“I believe that homebuying, in particular — purchase prices and acquisition costs per property — will continue to fall in the real estate market,” he said. “Rates, in my opinion, will rise modestly in 2024. They may begin to slow in approximately a year, but they will never return to the 2%-3% range that they were previously. Homebuyers and homeowners should brace themselves for rates above 6%. Even if interest rates fall more, I expect they will finally stabilize between 5.5%-6.5% for the foreseeable future. I don’t believe it will cause a crash; rather, I believe it will simply become the new standard by which we live.
“Furthermore, inventory will remain low as long as construction and build rates on construction loans remain close to 10%. People will have to pay a high price for units if the inventory stays low as the market adjusts to supply and demand chains. When they do that, not much affordability is left. Rates are the beginning of the trickle-down effect. In 2024, I envision interest rates beginning to stabilize slightly in the 6s, dropping through the 7s and hopefully leveling off in the mid-6s. At that point, people will have the confidence to build and buy again and enter a thriving market that is actually supporting growth, which is not the case at the moment.”
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