Most parts of the country, with the exception of some lucky regions, have become familiar with the term polar vortex. Weather patterns over the past few weeks have reached unbearable lows. Even going outside can be dangerous if you are not prepared accordingly. However, the cold front may benefit real estate investors intent on house hunting this winter. The weather has all but eliminated most of the competitors in the market at this time. Most buyers will not leave their houses when the temperature hits freezing, leaving sellers desperate for offers. If you make the right offer on the right property, you could find yourself a great deal. With that being said, winter house hunting can offer great deals if you can put up with the cold.
Pricing and timing are two of the most key principals in real estate investing. While your summer offer may be laughed at, it will be considered and possibly accepted in the winter months. There is always a lull in the real estate market from Thanksgiving until Easter. Most sellers that list at this time know that they will most likely not get full market value for their property. Any offer that comes in during this time will be given consideration. If you can make a cash offer, it may just get accepted.
One of the problems with buying in the cold of winter is that you may not get a true sense of the property. Bank owned listings will be winterized, meaning you won’t be able to see if the water or furnace is in working order. Some lenders will turn it on for the inspection while others will make you buy as is. This could work for you or against you, but at a minimum it will either lengthen the process or cause some uncertainty in what you are buying.
However, it may be good to see the property and neighborhood in some of the worst possible conditions. If there is snow or ice on the road, you can see what you or your tenants will be in for. You can get a sense of what issues the cold may present without having to pay for them. You may also get a seller that is eager to sell before any issues are exposed do to the cold. As with any deal, you should want to get an inspection or make your offer low enough that if you find something after you buy there is still room for profit.
When the temperature drops, it doesn’t mean you should stop looking for properties. It may be unpleasant walking through some snow to see a property or dealing with cold once you get inside, but this is all worth it to get a good deal. Buyers will be looking to see the next few months and most offers will be considered. You will always come across some lenders and sellers that are willing to wait the winter out, but all it takes is one eager seller and you may get a good deal.
Your business should not shut down from January to April just because it is cold. Use the winter to find deals and you can be sure that you will stumble upon the right seller who is eager to sell.