With mortgage rates topping 7% at the end of September, it seems overly optimistic to say October is the best month to buy a home in 2022.
But rose-colored glasses aside, history and the latest market data from ATTOM suggest exactly that. Buyers who close on a home in October will pay the lowest premium over market value compared to other months of the year.
October is the Best Month to Buy
ATTOM is a leading curator of land and property data nationwide. According to a recent analysis of home sale data, October, and the winter months that follow, offer the most significant cost savings for homebuyers — with substantially lower premiums than other months. This comes directly after Realtor.com’s best week to buy a house (September 25-October 1).
According to ATTOM, those who buy a home in October typically pay about 3.3% over the home’s market value. In May, premiums are at their highest at a median of 10.5% over market value.
ATTOM’s analysis is based on a study of over 39 million single-family home and condo sales over the last nine years. Data points to a continuation of a strong sellers’ market overall, with some relief for buyers in mid-fall and winter.
Apparently the old adage ‘Spring forward and Fall back’ applies not only to setting your clocks, but to home prices as well. Seasonality has always had an impact on home prices, which tend to weaken in the fall and winter months when there’s less buying activity. Savvy home buyers can take advantage of those lower prices and less competition from other buyers once the leaves start to turn.
Cooler weather, school schedules, and high mortgage rates
So, why is October the month with the lowest premium for homebuyers? The impact of school schedules and cooler weather combine to make the housing market less competitive.
According to Rick Sharga, home sales tend to dip every September when kids return to school. October brings cooler weather and shorter days.
This year, those factors combine with mortgage rates that have more than doubled, pricing many buyers out of the market and causing others to back off.
Year-over-year price growth has slowed nationally, with some markets seeing declines. The general seasonal rules still apply—you’ll probably still see better prices as a buyer through the late fall and winter months than you will in spring and summer—but the whole market is being affected right now… Home prices will be better, but affordability is going to be a bit of a challenge, just because the interest rates have more than doubled in the last few months.
Best Days to Buy
ATTOM’s analysis goes into further detail, revealing the days of the year with the lowest premiums for homebuyers:
- November 28th: 1.1%
- January 9th: 1.3%
- December 5th: 1.5%
- December 26th: 1.5%
- December 19th: 1.9%
- December 12th: 2.0%
- December 24th: 2.0%
Best Months to Buy by State
The following five states stood out in ATTOM’s analysis for having the biggest discounts below full market value:
- New Jersey (-3.9% in February)
- Maryland (-3.5% in January)
- Michigan (-3.3% in October)
- Illinois (-2.7% in October)
- Connecticut (-2.4% in December)
What can you do?
Collect and share data like this to educate yourself, your clients, and your community on the best times to buy a home, so you can help them save money at closing and lock in a mortgage payment they can afford.
Share this data with your sellers, too, so they can choose the best time to list their homes and capitalize on the best ways to make their homes stand out.
Be the resource buyers and homeowners in your area can count on to keep them informed.