What is the best time of the year to buy a home?
Chances are that you stumbled across this article because you want to learn about when the best time of year is to buy a home. Honestly, there is no one singular best time of year to buy a home.
Yes, you read that correctly, no one month or season is better for buying a home than another. You might be wondering why we are making this argument.
Here is something to consider. The best time of year to buy a home will be different for every person and family. The best time of year for you to buy a home will depend on factors such as, your schedule, your financial situation, how much money you have saved up, your needs, where you are looking to buy, what you are looking for, etc.
It is important to consider that the best time for you to buy a home will depend on your location. You might be wondering what do we mean by this?
For example, if you are looking to buy in an area with a warmer climate, you might not see as many seasonal differences with home prices and home sales. For example, if you are looking to buy in Florida, you might not see sellers that are in a rush to close a deal in September because they are worried about changes in the weather cooling down the housing market.
If you are looking to find the best possible price in Toronto, you might want to look to buy it during the winter. However, if you care more about having more choices in possible homes, and are not as concerned about finding a bargain, you might that you would be better off looking to buy during the spring and early summer.
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In this article, we will explain why house hunting during the winter will help you get the best bargain in Toronto. We will also explain why buying in the spring and early summer in Toronto is best if you want to have a lot of choices. And we will provide an overview of what you can expect if you are looking to buy a house during different seasons in Toronto.
The Best Time of the Year to Buy a Home for Lower Prices
Winter is the best time of the year to buy for lower prices in Toronto and the Greater Toronto Area (GTA)
Buying before and around the holidays in December, and in January is usually a good bet if you are looking to find to lower prices or bargains. If you are looking to buy in a competitive real such as the Greater Toronto Area (GTA), closing on a home during a less popular buying season could potentially save you tens of thousands of dollars.
The biggest reason which explains lower prices if you are buying homes in the Greater Toronto Area during the winter, especially during December and January, is from supply and demand.
That is certainly a main reason to consider winter for the best time of the year to buy a home. Most people are not usually looking to buy a home in the middle of winter in Toronto, especially during or after the holidays.
It is much easier to look at homes during the spring and early summer when the days are longer, and the weather is better. However, savvy buyers might see buying a home in December or January as an opportunity because fewer buyers will mean less competition.
While Toronto is now infamous for real estate bidding wars, one would hope that when there are fewer buyers, you might be less likely to end up in a bidding war. Even if ending up in a bidding war is unavoidable, you still will be able to reduce the amount of money you are spending when compared to other popular months and seasons for buying a home. If you go into this already pre-approved for a mortgage, this will make trying to buy during the winter even easier for you.
Something to consider is if you are looking to buy a home in an area where there are four distinct seasons, is generally you will see fewer homes for sale during the winter. People who are putting their houses on the market during the winter, especially during December or January are probably doing so because they need to sell their homes quickly and cannot wait until the spring.
Additionally, if a seller is putting their house on the market during December or January, buyers can feel more confident knowing that sellers will be eager to close the deal. If sellers were less eager to close the deal, they would have waited to put their home on the market during the spring, when there might be more competition for their home, and they could potentially get more money for their home.
However, not everyone is able to choose when they can sell their home because a variety of potential circumstances could be forcing them to sell their homes during the winter. Given this, the buyer will have a lot more leverage when they are negotiating with sellers because houses usually take much longer to sell during the winter.
During the winter months, it is frequently the buyer who might be dragging out the sale process, waiting for a better deal. While frequently during the spring, the seller will be the one dragging out the sale process while they wait for a better price.
This means if you are looking to buy in the winter, especially during December or January, you will be an advantageous position when negotiating with the seller. But homes that might be for sale during December and January might need a lot of work, such as fixer-uppers.
However, do not let the potential to mainly see fixer-uppers to deter you from house hunting during December or January because you never know what you might find. You might find a diamond in the rough.
January is usually the best month of the year to buy in Toronto and the Greater Toronto Area (GTA) to try to find the best deals on homes
During 2016, the now-defunct Toronto based real estate brokerage, TheRedPin, released their findings from their six-year analysis of more than 530,000 home sales in the Greater Toronto Area (GTA) from (2010-2015).
They explained that they noticed a trend that buyers who bought homes in January during this six-year period saved compared to those people who bought homes during the traditional spring real estate market and when compared to the overall calendar year.
TheRedPin stated that they saw a trend in their data, that people who bought homes in the Greater Toronto Area (GTA) in January on average spent $60,000 less than people who bought their homes during the traditional Spring real estate season.
Buyers, who bought homes during January spent on average $43,000 less than the overall calendar average. This was true for buyers in the Greater Toronto Area (GTA) who were buying their homes in January when compared to home sale prices throughout the whole calendar year.
However, it is important to note that in January in the Greater Toronto Area (GTA) there are not as many homes for sale as there are during other times of the year. There are also fewer potential buyers looking at available properties in January in the GTA.
Therefore, do not be surprised if any real estate agent or broker were to tell that you as the buyer, would automatically benefit from there being less competition to buy your next home.
When you are buying in January, you will also benefit from having more flexibility when the time comes to make a decision. This will allow you to negotiate harder with the seller because the seller might have fewer offers to choose from.
It is important to note that the savings you might be able to enjoy buying a home in Toronto in January, is in part because of the likelihood that many homes in Toronto and the Greater Toronto (GTA) are sold for more than their asking price during busier seasons. However, you will see how supply and demand impact real estate markets across Canada.
TheRedPin concluded that with fewer buyers and decreased competition, homes in January will take longer to sell. Additionally, buyers might have the potential to lower real estate prices.
A savvy real estate agent would usually recommend that their clients wait to list their homes in the spring when the housing market heats up. However, there are many situations where the sellers might be forced to try to sell their home in January.
Given that homes in Toronto and the Greater Toronto Area (GTA) on average take seven days longer to sell in January when compared to selling a home during the rest of the year, homeowners might accept an offer that is below their original asking price to ensure that the sale goes through.
However, the weather in January is not the only thing preventing buyers from looking at homes in January. January also is the month when everyone is receiving their credit statements and bills after potentially spending a lot during the holiday season.
Seeing their credit card statements after potentially spending a lot of money in December, might force some potential buyers to reconsider their timeline when buying a home. Despite your desire to get the best deal possible or what a lender might tell you if you have a lot of consumer debt, it is probably not advisable for you to be looking to buy a home.
The Best Time to Buy a Home with More Options
Look to buy a home in Toronto and the Greater Toronto Area during the spring and early summer if you want to have more choices
If you want to have more choices when you are looking to buy a home in Toronto or the Greater Toronto Area (GTA) it is recommended that you consider looking for homes starting in the spring. Homes tend to show better in the spring and sellers know they can usually get more money for their homes if they are selling their home during the spring or early summer as opposed to selling their home during the winter.
However, there will be a lot more competition over homes during the spring and early summer, especially in tight real estate markets like the Toronto and the Greater Toronto Area (GTA) real estate markets.
Home sales data from the Canadian Real Estate Association (CREA) compiled from 2007 to 2016, indicates that May was the month with the highest average number of new residential listings. On average May had on 94,746 listings.
On average May is the busiest month for new listings, followed by June. June might be one of the busiest months for home sales in the Greater Toronto Area (GTA). Therefore, it should surprise no one that the months of May and June on average have the highest number of sales. On average the month of May had 53,132 sales and the month of June had 50,742 sales.
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What to Expect When Looking at Homes Depending on Seasons
What to expect when you are looking to buy a home in Toronto during the winter
As mentioned earlier, winter might be the best time of the year to buy a home in Toronto and the Greater Toronto Area if you are looking to find a bargain. People are not usually looking to buy a home in December around the holidays at the end of the year with the stress of the holidays. Most people are not looking to have to get their house ready to sell during this busy time or worry about securing financing to buy a new home.
Come January, people are usually less likely to have to spend more money after potentially having spent a lot of money during the end of the year holiday season. Additionally, moving during a Canadian winter can be challenging. At best you might have decent weather or at worst you might be confronting nightmarish blizzard weather at worst.
Home sales data from the Canadian Real Estate Association (CREA) compiled from 2007 to 2016, indicates that December was the month with the lowest number on average of residential listings. December on average had 30,870 residential listings. The month of December typically had the lowest average number of sales each year with 23,458 sales.
What to expect when you are looking to buy a home in Toronto during the spring
As winter ends, the ice starts to thaw when the weather starts warming up and with the days getting longer, people will begin to emerge from their homes. With the beginning of spring fever once again, you will start seeing many more homes for sale during the spring and many more potential buyers will be out and about looking at homes.
Sellers who might have taken their listings off the market during the winter might put their homes back on the market. Nicer and more pleasant weather during the spring makes it easier for homeowners to make improvements. Therefore, do not be surprised if you are seeing more higher quality homes in the spring real estate market listed at market-rate prices.
However, the increase in inventory of available homes for sale will be offset by greater competition over premium and luxury homes and higher prices. During the spring, sellers might be more optimistic that they will be able to sell their home before the start of the summer, so sellers might be less inclined to accept a buyer’s lowball offer.
What to expect when you are looking to buy a home in Toronto during the summer
The summer real estate market in places like Toronto and the Greater Toronto Area (GTA) is often similar to the spring real estate market. But fewer sellers will be putting their homes on the market during the summer when compared to the number of homes that are on the market during the spring.
With the summer real estate market, you might see price reductions for homes that were listed early on in the spring, that have not sold yet. With houses that listed during early spring that has not sold by the start of the summer, you might see sellers who might be more willing to compromise with buyers over their home’s sale price.
Given that there are still new homes being listed there will be plenty of homes for buyers to see and visit. Another thing to consider is that many buyers are looking to close on the sale of their new homes before summer begins so their children can start at a new school in the fall. As summer progresses you can generally expect to see fewer homes for sale and potentially less competition over premium or luxury properties.
What to expect when you are looking to buy a home in Toronto during the fall
If you are looking to buy a home in an area like the City of Toronto or the Greater Toronto Area (GTA) during the fall, you might notice that the real estate market begins to slow down in the fall. This in part can be explained by families who might have been considering moving, with their children back in school might decide to wait since the timing for moving might not be ideal.
Looking to buy in the fall means you might be seeing smaller crowds at open houses and have an easier time with scheduling showings for homes that are currently on the market. When looking in the fall, you will probably see fewer new listings of homes for sale. This might be then the best time of the year to buy a home in Toronto for you.
It is possible that prices could drop in the fall. During the fall, some sellers might become extremely motivated to sell their homes before the end of the year. This means that some sellers might be more inclined to negotiate with buyers the closer you are to winter.
Related article: The Ultimate Buyer’s Guide for Buying a House in Toronto
If you are pre-approved for a mortgage during late summer and are flexible about when they close on a home, you might be able to find a better deal buying in a fall or winter market.
Buying a home outside the spring and early summer rush to buy homes can help you avoid a lot of stress and potentially save a lot of money. If you are flexible and willing to buy during the winter, you could potentially get a bargain for a home.
However, it is recommended that if you are looking to sell your home that you put it on the market in the spring and/or early summer. If you are looking to sell your home in Toronto or the Greater Toronto Area (GTA) you could potentially get thousands of dollars more for your home if you are able to sell your home during the spring as opposed to selling it in the winter.
There are advantages and disadvantages to buying a home no matter what the season is. However, when you know what you can expect when you are looking to buy a home depending on what season it is, you will be able to evaluate properties, better understand real estate trends and house hunt with less stress. Contact us today to know the best time of the year to buy a home!
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