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Should you buy a property during the holidays? We list down the pros and cons of purchasing a property over Christmas and New year.
A house isn’t something you’d usually see on people’s Christmas wishlist. That’s because when it comes to buying (or selling) a property, the weeks surrounding Christmas and New Year are not considered to have optimal conditions for a buying process.
Why is that the case? Well, for starters, the Christmas and New Year period is traditionally when real estate activity – like the rest of us – slows down and takes a break. Additionally, who can be bothered to do property research and paperwork when there are getaways to go to and barbecues/parties to be at during the holiday season?
Moreover, most lawyers and conveyancers typically take holidays during this period, making the buying process a real drag. Not to mention that enlisting the help of real estate agents at this time may be difficult, as they may also be taking a break during the festive season.
For most people, it sounds more feasible (and less stressful) to hold off talks of purchasing a property until the summer months are over and the property market kicks back into gear.
But on the flip side, you may also hear about the holiday season as the perfect time of the year to nab a bargain or secure a quick sale.
Some experts perceive the holiday hiatus as a thing of the past, with some touting that the two months surrounding this holiday season as having the potential to provide a good opportunity to snap up a savvy investment.
So if you’re the type of investor who’s always up for a challenge and is not easily deterred by a few hiccups, maybe a Christmas house hunting venture is just the thing you need to spice up your holidays.
If you’re still on the fence about whether you should or should not buy a property during the holidays, we lay out the pros and cons to help you decide if you should add a property to your wish list.
Advantages of buying a property over the holidays
Here are reasons why you should buy a property during the festive season:
During the holiday season, you will likely see fewer homes on the market. But there is an upside to this; yes, there are fewer sellers, but there are also fewer buyers looking to buy a home.
Many buyers who have been unsuccessful in their home hunt throughout October and November are starting to fatigue by December. In addition, there are time demands around finishing up work and planning festive-season celebrations with plenty of family gatherings and professional events to attend.
All this will see plenty of potential purchasers put their house hunt on hold – which means the competition will be less fierce, and it’s less likely that you will get caught in a bidding war over a house or lose houses to faster (and higher) offers.
The holiday period is a good time to buy a house because the end of January and February will see the competition heat up again, with everyone returning to work and holidays coming to an end, particularly after Australia Day.
It’s a safe assumption that vendors who keep their properties listed during Christmas are motivated sellers. They want to sell their house now, for whatever reason – and they are not waiting until late January for new buyers to show up. Maybe they have already committed to buying another house or have to move because of a job transfer.
Whatever the reason is, remember that motivated sellers are a buyer’s friend. If a vendor believes the common assumption that Christmas is not a good time to sell but is still keen to reach a sale before the break, they might decide to enter the market at a lower sale price than usual to lure in more serious buyers. This could mean getting a property at a below-market price.
The slowdown in market activity during the summer season translates into a mortgage slowdown. For mortgage brokers, this means that the holiday season is their lean season due to the lower sales.
While this spells a bad time for mortgage brokers, this can work to your advantage. Because business is slow, your mortgage broker may be more motivated to work out a better mortgage package for you.
If you’re a buyer looking to secure a property over the holidays, you may have greater flexibility to work with the owner towards a quick settlement.
This is because there’s a possibility that if a vendor is selling over this time, they, too, want a quick sale before the January rush. This will give you an upper hand during negotiations, especially if the owner starts to feel the pressure of less interest during this period.
Disadvantages of buying a property over the holidays
Some of the downsides buyers experience at this time of year includes:
Because there are several holidays over the weeks surrounding Christmas and New Year, you can expect offices to be closed and business hours to be spotty at best. This means that getting the paperwork and finances of the sale settled can be a tedious process.
On the supply side, most vendors planning to sell before year’s end would have listed their property by late October/early November. This means that when summer rolls around, there are generally fewer options on the market. So while you might have some luck getting a bargain, you may have a harder time finding your ideal property.
It’s important to remember that real estate agents, mortgage brokers and solicitors are humans too, and they may be on vacation or break during this season. This means it might be harder to get the real estate agent you want, or it could be difficult to get in contact with them during this period when you factor in public holidays and potentially shorter hours.
Are you planning to kick off your property investment journey but don’t know where to start? We’ve got you covered. Check out our Why 2022 is the right year to invest for beginners white paper, aimed at providing first-time investors with the know-how they need to invest in property the right way.