Winter Can be Bargain Season for Homebuyers, and Flexible Approach Works Best When Weather Is at Its Worst, RE/MAX Reports
CHICAGO, Nov. 27, 2018 /PRNewswire/ -- Increases in home prices and mortgage interest rates have hurt home affordability in 2018, but winter may offer some relief, especially in colder climates where home buyers often hibernate during the chilliest weather.
"In the Midwest, homes that go under contract in November, December and January usually are offered by highly motivated sellers," explained Jeff LaGrange, Vice President of the RE/MAX Northern Illinois Region. "In spring and summer, purchasers may pay a premium because they compete with many other buyers. Less competition in winter means prices typically don't include that premium, and sellers frequently are more flexible about price and other terms."
Home sales activity and home prices in the Chicago area and across northern Illinois usually peak in June and hit an annual low point in January and February. Over the last 14 years, Chicago-area homes sold in February had a median sales price that averaged 17.8% less than homes sold in June of the same year, LaGrange said, with the difference between the median price in February and in June hitting a high of 33.1% in 2013 and a low of 6.7% in 2008. This year the spread was 13.2%.
"Of course, that doesn't mean the price of every home on the market will drop by 10% or more just because it's November," noted LaGrange. "What we find instead is that list prices often are more conservative to start with, and sellers may be more willing to negotiate on price and other terms, especially if they are eager to close the sale. But some of the price difference in winter reflects the fact that homes in the best locations and great condition sell quickly and usually aren't on the market at that time."
The possibility of getting a bit more value for their money is not, however, among the prime reasons that homebuyers house hunt in winter, reports Linda Dore, a broker with RE/MAX Synergy in Orland Park, Ill.
"Most often they have a real need to buy quickly, perhaps because of a work-related relocation, the arrival of a new baby or dealing with a divorce. But this year they should have an added incentive as mortgage interest rates are likely headed higher in 2019," said Dore.
Capturing a wintertime home bargain, however, means dealing with sometimes challenging conditions, Dore pointed out. So, buyers need to be flexible. For example, with fewer hours of daylight, it may be necessary to visit more homes after dark, a less than ideal situation.
"When that happens, it makes sense to arrange a daylight visit before making an offer, and that can involve taking time off work," Dore explained, "but it's worth it."
Liz Kmet of RE/MAX Properties in Western Springs, Ill., said that she approaches winter home searches with an eye on staying comfortable.
"Going from house to house in cold weather isn't that pleasant, so I urge buyers to dress warmly and comfortably and to wear shoes that are easy to slip off and on. Days are short, so you want to start early, and take a coffee break to warm up and relax.
Perhaps the biggest challenge for buyers in winter is evaluating vacant homes, contended Donna Smolak of RE/MAX Vision 212 in Chicago.
"These days, more homes than ever are vacant when they go on the market, and you never know what to expect," she said. "Some can be beautifully maintained, but in other cases there can be six-inches of snow in the driveway, the storm door many be frozen shut or the whole home may be winterized with the heat and plumbing out of service," she said. "I always bring a fold-up shovel with me in case a car gets stuck or we want to scrape snow off an outdoor area to check what's underneath."
Another reality of home shopping in winter, noted Corey Barker of RE/MAX Center in Grayslake, Ill., is that any home can feel somewhat dreary.
"Homes don't have the same curb appeal in winter that they do when everything is blooming in spring," he said. "That's why I try to focus winter buyers on the basic qualities of each home. Does it offer the location, layout and space that they need? How well has it been maintained? It can be a little harder to fall in love with a home in winter, but in a way that makes it easier to evaluate a home's most important qualities."
With more than 2,200 sales associates and 106 offices throughout the area, RE/MAX Northern Illinois has helped thousands of families with their home buying and selling needs. For more information, visit www.remax.com or download the RE/MAX mobile real estate app.
SOURCE RE/MAX Network
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