Home buying season not over yet

November 21, 2013

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What is typically seen during the winter months in the real estate market is a sharp decrease in the number of transactions and homes sold. Prices are usually slightly cheaper than in the summer and spring too. However, this year the real estate market is still hot entering the holiday season, with buyers on the lookout for a new home purchase.

According to Realtor.com's Winter Home Buyer Report, the winter housing market is still going strong. With a lower-than-normal level of inventory of homes listed for sale, prices have been rising quickly over the last year.

"Instead of the usual seasonal slowdown, October data show the 2013 fall market moving at a fast pace," said Realtor.com's President Errol Samuelson. "Inventory has returned to last year's levels, but prices continue to strengthen and homes are moving significantly faster compared to this time last year."

Winter market trends
Home buyers during the seasonal selling months of spring and summer found themselves in an extremely competitive market with bidding wars. While some of the same trends have carried on into the winter market, fewer home buyers are searching for new properties, offering more opportunity. Many of the same buyers who were house hunting in the warmer months are still looking.

"This summer and spring homebuying season was particularly challenging for buyers, especially first-time home buyers trying to compete with all-cash offers and bidding wars because of reduced inventory," said Realtor.com's vice president of corporate communications Alison Schwartz. "In fact, a quarter of the winter home buyers revealed they are in the market now because they were unable to find a home during this last home buying season."

One of the biggest challenges for buyers in Realtor.com's report was the lack of inventory in the market, with 45 percent of respondents citing not enough inventory in their price range as an issue. Another 34 percent believed there was not enough inventory overall. Lower inventory levels have helped push home prices up over the last year. For first-time home buyers, the competitive seasonal selling was extremely difficult as bidding wars were common and all-cash offers were favored.

Buyers who are still active in the winter are mostly hoping for a better deal. However, with fewer houses available, homes that have been on the market longer are finally being sold. There is no doubt there are fewer buyers after seasonal selling has ended, but they tend to be more serious when it comes to searching for a new home in the winter.

"While buyers are still experiencing challenges with inventory and approximately one in five buyers plan to put down all cash, there are advantages to looking for a home in the winter," Schwartz stated. "Motivated sellers, better prices and less competition between buyers are some of the top reasons winter home buyers are interested in purchasing a home during the colder months of the year."

Contact the Federal Savings Bank, a veteran owned bank, to explore affordable housing options.