Why Winter Is The Best Season For Purchasing Rental Properties
The more properties you own, the more you can earn in rental income. While this is clear, what may be less clear is the relationship between home sales and weather. When temperatures drop, home sales stop or slow in many areas of the country. Savvy landlords know there are benefits to buying rentals in winter.
Why Buy Rental Property in Winter?
Fewer people want to look at real estate during winter. There are many reasons for this behavior — whether it’s chilly weather walking from the car to the house, slush and snow that make driving dangerous, or holiday obligations.
Sellers may remove their homes from the market for the winter, in hopes of getting a better deal come spring. Others may try to stand out in the winter market — for instance, sellers who need to relocate and don’t have the luxury of waiting for spring — and attempt to lure buyers to their homes.
Homeowners who want to sell in winter understand they won’t have many interested viewers until the market picks up in spring. In an attempt to move their home, many lower their expectations of the price for which their house should sell — and thus, their asking prices.
Landlords reap several benefits from this behavior:
First, fewer people shopping for homes means less competition for rental properties. If you’ve ever wound up losing to a higher offer, you’ll appreciate this seasonal perk.
Second, most homeowners will be willing to consider a lower offer. You may be able to purchase a property you would not have been able to afford during high season, stretching your dollar. Or, you could save money on a home purchase — money you can use to improve the rental.
Tips for Buying Rental Properties in the Winter
November, December and January tend to be the slowest months for real estate, with the market picking up around March. While the biggest bargains can be had in these months, regional markets may be slower or faster to gain traction. It really depends.
There are a few considerations for looking at properties in winter. The foundation may be hidden under snow, which makes it more difficult to get an understanding of its condition. Always have a property inspector check the home. In winter, make sure the inspector removes snow from the foundation to check its condition. Steer clear of properties with foundation problems, as it is a pricey fix.
Search for photos of the home in spring to check landscaping needs.
Then consider the driveway and sidewalk. Gravel driveways or cracked sidewalks may be difficult to clear. This usually isn’t a deal breaker, but it can be an extra expense if you plan to use a snow removal service.
Join American Apartment Owners Association
If the home passes inspection and meets your needs, you can buy with confidence.
When you acquire a new rental property, it’s a good idea to review your leases. If yours is old, join AAOA today to get a customizable lease form, tenant screening packages and other benefits. AAOA’s lease forms are reviewed by legal and real estate professionals, so you can rely on them to protect your interests and your property.