You might benefit from a drop in competition, but it isn’t all tinsel and fresh-paint smells when you’re buying in the busiest time of the year.
As someone who bought a house around Christmastime, I’ve seen first-hand how the market changes.
Fewer buyers and sellers gave me more negotiating power, however there were challenges when it came to signing on the dotted line.
Let’s look at the bright side of buying a home in December, and the snags that might trip you up.
The benefits of buying a home at Christmas
1. Less competition
Spring is usually the prime house-selling season. Auction clearance rates often go over 65%, pushing competition and prices into a seller’s market.
But, once the home-buying heat dies down and the heat of summer approaches, fewer people want to buy or sell.
And that’s simply because Christmas is too busy. People can’t sell a home while they travel. Few people want to pack up and move or negotiate sales instead of sitting with family around the Christmas tree.
As a buyer, that can mean less competition for houses, less of a bidding bidding war and potentially better prices.
2. Sellers are more motivated
Christmas Day and New Year’s Day are hard deadlines, and sellers might be highly motivated to vacate their old property and move into a new one beforehand. This can open the door to lower prices and the upper hand in negotiation.
For instance, I negotiated a lower price on my home because the seller wanted a specific settlement date a week before Christmas. Other bidders weren’t able to meet the seller’s request.
We were still unpacking on Christmas Day, but it was worth it for the savings.
3. Real estate agents want to close sales
Seller’s agents may want to “close the book” on homes in their portfolio before the year’s end so they can have time off. It may make them more open to offers and settlement options.
You can use that to your advantage by being flexible about move-in dates and coming in armed with home loan pre-approval.
The pitfalls of buying a home at Christmas
1. Possible delays in paperwork
There are multiple public holidays in December and January. Banks, solicitors and real estate agents may close up shop for up to 2 weeks.
It can add a lot of pressure and stress to push the paperwork through in time and find available specialists when everyone is winding down for the year.
2. Fewer options on the market
Many people may pause their house sale over Christmas or wait until later in the new year, so there could be fewer homes for you to consider overall.
How to use the slow Christmas period to your advantage
Here are some for being ready to dive in when you spot a good deal on a listing.
- Do your market research early so you’re ready to submit an offer when you find a home that ticks the boxes.
- Build relationships with real estate agents, because being a “somebody” holds more clout than being a “nobody” when you’re competing for a home.
- Do a financial health check and look at consolidating debt and improving your income/expense ratio to boost your home loan approval chances. You can reduce your debt repayments with a 0% p.a. balance transfer credit card, or a personal loan with a lower interest rate.
Whether a Christmastime home is a good idea for you ultimately depends on the houses that pop up on the market.
It has to suit you and your budget, so it’s important to know how much you can spend and have your finances in order, ready to go.
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