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Everyone dreams of the day they can finally say goodbye to their landlord and hello to home ownership.  After scraping together a 20% down payment, you’re probably eager to get your house hunt underway.  Hold on, pump your brakes.  Even though the spring and summer are the most popular times to buy a home, you won’t get the best deals.  Studies show that it may be worth while to hold off until the fall.  Here’s why…

Less competition

As the weather heats up so does the real estate market.  Realtor.com reports that 50% of homes are sold during the summer. This is a prime time for most families because summer break gives them the chance to move and settle into their new home before the next school year begins.  With all the extra foot traffic, there’s a better chance of getting into a bidding war and driving up the sale price.  By waiting until the weather cools off, you’ll face less competition and get a better deal.  The downside is you’ll be stuck with a house that nobody else wants and it may cost more to fix it up.

Lower home sale prices

Once the summer has come and gone, many buyers put their search on hold until next spring.  The longer a house sits on the market, the better it is for you because you’ll have more negotiating power.  Depending on your location, a well-priced house can sell in 30 days or less.  Any longer and it’s a good sign that the house is overpriced for the area.  If your dream home has survived the summer without any takers, the owners may be getting desperate for a sale.  Use this to your advantage and make them an offer they can’t refuse.  According to NerdWallet, home sale prices drop an average of 2.96% or $8,300 between the summer and fall.  That figure jumps up to 8.45% when comparing summer versus winter sale prices.

The bottom line

Regardless of when you plan to buy your home, the timing will never be right if your finances aren’t in order.  Before taking the plunge, make sure you can actually afford it.  Most lenders prefer that your monthly expenses take up less than 36 percent of your income.  This includes your mortgage, student loans and the rest of your financial obligations.  We suggest playing around with one of those “How much house can I afford?” calculators to see what fits your budget.  Keep in mind that you’ll still need to cover the closing costs, home inspection and other “hidden” expenses.  As if that’s not enough, your lender also expects you to have at least two mortgage payments remaining in the bank.