Are you considering putting your house hunting on hold until after the New Year? While it may seem like the end of the year is not a great time to buy a home, it can have many benefits. In fact, now can be an excellent time to get a great deal on a house. Here are seven reasons why you should buy a home before the end of the year.
If you close on a home and are living in that home on or before January 1st, then you will have an opportunity to apply for your homestead exemption. A homestead exemption removes part of the value of your property from taxation and therefore lowers the amount of your property taxes. For example, Harris County provides a 20% optional homestead exemption to homeowners within the area. If your home is valued at $200,000, the exemption will reduce its taxable value by $40,000 bringing it down to $160,000. Your home qualifies for an exemption if 1) you own it, and 2) it is your principal place of residence on January 1st when the county assesses annual property taxes. The amount of the exemption depends on state and county laws. So if you close before the end of the year, it is a good way to ensure that you can realize those tax savings in the new year.
Spring and summer are typically the busiest seasons in the real estate market. Families with school-age children will often move in the summer to coincide with the school year. For this reason, you’ll find there is much less competition in the housing market. Your offer on a home is more likely to be accepted when there are fewer potential buyers putting in bids.
More time to decide
When you have fewer buyers to compete with, then you won’t have to make an immediate decision on a home. In competitive markets, it’s important to move quickly. But at the end of the year, you can take a little more time to make your decision. If you need to sleep on it, then you have the luxury now to do that.
When there are fewer buyers in the market it can mean that sellers are more motivated. This is especially true if a seller wants to close on a deal before the end of the year. You’re more likely to find a motivated seller who is willing to negotiate when you’re house hunting at this time of year.
When there are motivated sellers, you’re more likely to get a great deal on a home. At this time of year, you’ll find homes that have been on the market all summer without an offer. This could mean that the home was overpriced to begin with. You’ll be in a good position to negotiate with the seller, who will be more open to your offer.
More builder incentives
Finally, if you’re buying a new home, then the end of the year can also be a great time for you to save money. Builders can sometimes offer incentives at this time year. This can include credits towards upgrades, paid closing costs, or even discounts on the asking price.