When winter comes, it can seem like the world of real estate – just like the world at large – is hibernating. Construction work slows, open houses are sparsely attended and real estate agents just aren’t as busy.
But if you’re searching for a new investment property, these can be some of the best months to buy a house:
- There’s less competition. Most people are buying properties in warmer weather months. People aren’t looking to move now, when their kids are in school. You can swoop in and offer a deal that sellers might not have been expecting to get.
- Homes are priced to sell during the winter. Sellers will often be willing to negotiate on the price so they can get the building off their hands.
- Sale prices are lower in metropolitan areas during the winter, with the cost of a single-family home dropping nearly 8.5 percent from the summer months to January and February.
- Properties tend to stay on the market longer during the winter. According to figures from Zillow, the average age of inventory for Philadelphia metro area properties was 91 days in January of this year, compared to 65 in July.
- If you close your deal before the end of the year, you’ll reap some nice tax benefits.
With that in mind, here are a few tips to landing investing properties in the off-season.
1. Be confident when you negotiate
As we said earlier, homes are priced to sell at this time of year, which means that as a buyer, you have the upper hand. Most sellers typically wouldn’t choose this time of year to put their property up for sale.
But since they have, they likely need to sell it quickly, or it’s been stagnating on the market for some time. Either way, the seller is likely motivated and ready to negotiate.
2. Be careful when you negotiate
Although you may have the upper hand when buying investment properties in the off-season, don’t expect sellers to give in immediately. Know the difference between a low price – 10 percent off – and a low-ball price (low enough to make them angry).
3. See past the snow
A lot of properties don’t look their best in the dead of winter. But smart investors are able to look past the piles of greyish slush and picture how the home might look on a sunny day in June.
4. Offer some flexibility
The person selling their home in January may not necessarily want to have to pack up and move in the dead of winter. You might be able to get a better deal by agreeing not to take possession of the property until warmer weather comes.
5. Use your network
During the off-season, your network of real estate agents, inspectors and appraisers won’t be as busy. Take advantage of this fact.
Agents will be glad to get some extra work during the lean winter months, and appraisers and inspectors will have more time to examine the property you’re considering.
If you’re reading this and thinking “But I don’t have a network,” don’t worry. That’s where the Diversified Real Estate Investor Group – otherwise known as DIG – can help.
Our organization is made up of professionals from all areas of the world of real estate, allowing you to build a network and hone your skills. Stop by our next meeting to find out how DIG can help you make money on your investment properties, no matter the season.