This September should be the best month all year to buy a home.
Many factors are coming together to make this September exceptional.
The first factor: the current low level of mortgage rates. Thirty-year fixed rates ended last week under 4% as a result of the resent stock market declines — a little turbulence in one area stabilizes other areas.
The second factor is the supply. Buyers will now have more choices than they have had for the past 8 months and the single biggest factor holding back buyers from making a purchase all year long has been the inability to find a home that meets their needs.
The third, and final, factor: is demand. Normally inventory peaks in August and begins to slow in September. Now that school has started, demand has already started to decline. You can see the evidence in the nonseasonally adjusted pending home sales data repeorted by the National Association of Realtors last week. The nonseasonal estimated number of new contract signings in July was down 12% from June. This kind of decline is entirely normal for July, since most contracts signed in July won’t close until after school starts.
And, of course, with less competition for the most listings all year, pricing power weakens as inventory takes longer to sell.
The seasonal pattern to pricing and median age of inventory tells us that the best deals come in the dead of winter. Signing a contract in September will likely mean you could close before Thanksgiving. That means September buyers won’t have as much moving hassle from winter weather, since for most of the country the threat of snow and ice picks up in December.