Spooky Season Is Buying Season

All of us who have that one friend who is counting down the days until October. They want nothing more than corn mazes, horror films, costume shopping, and Halloween decorations. For these people, there is no better time of the year than spooky season. They would trade away all of the sunny summer months if they could linger a little longer in the crisp fall. Even if you are not as enthusiastic as your pumpkin-loving friends, there is still good reason to be happy about October. Historically, the beginning of October has been the best opportunity for home buyers throughout the entire year. So, if haunted houses are not the thing that gets you excited, maybe a great deal on buying a new home will. The team at Peoples Choice Mortgage is here to help you understand why the beginning of October is a great time for home buyers. 

Data Shows October is Great for Home Buyers

Past performance is not always a good predictor of future results. However, looking at historical trends can still be valuable. In that sense, previous years let us know that we are now in the best time of the year for home buyers. Historically speaking, the week of October 3rd - October 9th is the time of the year that offers the best deals for home buyers. The question then is why has October been great for home buyers?

In the past, October is when there has been the most inventory available and home prices tend to skew below the peak. Given that the biggest cause of soaring home prices over the past year and half has been a lack of housing inventory, this is huge for home buyers. At the same time, there is usually less interest from home buyers during this time of year. Peak home buyer demand traditionally happens around July. In July, the days are longer, the weather is nicer, and families with kids are still in the middle of summer break. Home buyers are not as active as we get deeper into fall and winter. There is less daylight. The weather is colder. Home buyers with school-aged kids are also reluctant to move during the school year. Parents want to avoid switching schools and there is too much going on to pack up and move. 

Home Buying Conditions Could Become More Difficult

While history indicates that this week might be the best opportunity for home buyers, today’s real estate climate also indicates that might be true. There are signs that conditions might be more difficult for home buyers as the year goes on. So, even if right now is not the perfect time to buy a house, it might be far better than anytime in the near future. 

Mortgage Rates are Great for Home Buyers

Mortgage rates are still in a great range for home buyers. While they are not at the all-time lows we saw early in the year, these are probably the best mortgage rates you can get. Mortgage rates have been increasing slightly over the past month. Unfortunately for home buyers, that trend will probably continue. Most economic analysts predict that the Federal Reserve will have to increase interest rates in order to curtail inflation. In turn, mortgage rates will also rise. The more interest rates rise, the more it will cost home buyers to finance a home loan. Ultimately, there is no time like the present to buy a house and lock in a great mortgage rate. If you wait too long, you might be paying more than you would like. 

Inventory Will Not Dramatically Increase

Home prices have risen dramatically because there hasn’t been enough housing inventory to keep up with home buyer demand. There was a lot of hope that new construction would pick up as the pandemic recedes, which will eventually meet home buyer demand. Unfortunately, it appears as if new home construction is not going at a pace that is necessary in order to curb rising prices. Recent data does not pose a rosey picture for new home builds. New home construction slipped in August, which is not good considering previous months were not seeing huge gains. At the same time, lumber prices spiked by 40 percent in August. Taken together, do not hold your breath waiting for home prices to drop. Even if new home construction picks up, prices will still rise because it simply costs more to build a house. Altogether, home buyers might not get better prices than today. 

Final Thoughts

Historic trends and contemporary data all point to the idea that right now is the best opportunity home buyers might see in a while. Rising mortgage rates and declining inventory means that today’s home prices are probably the best you will see for a long time. Trying to wait out today’s market forces seems like a foolhardy exercise. Instead, the prudent thing is to buy right now while other home buyers are busy with pumpkin patches and binging horror films. October is offering home buyers a small bit of relief by giving you an artificial decrease in home buyer demand. Unfortunately, once that is over, home buyers will go back to facing stiff competition, along with rising mortgage rates and home prices. 

The bottom line is that if you are interested in buying a house it is probably wise to make an appointment with your mortgage broker in between apple picking and haunted houses. October presents a small window for home buyers, and those that are ready will be able to take advantage of this window. If you are ready to take advantage of this window, contact us. The team at Peoples Choice Mortgage will help walk you through your home loan options and do the work to get a deal done fast. Our mortgage brokers are ready to help you now before today’s favorable window closes.