Holidays are a good time to buy homes, but be careful

Historically during the holiday season between Thanksgiving and the New Year, when retail shopping is at its peak, fewer existing home sales contracts are written. While some homeowners also choose to hold off putting their home on the market until January or February, savvy buyers in today’s gradually improving economy know they have some advantages when home shopping during the holidays because they typically face less competition.

There are a number of other advantages as well. Home prices currently remain quite affordable, mortgage interest rates dipped to a low of 3.99 percent in late November for a 30-year fixed-rate loan, rising rental rates have made it a fiscally sound decision to purchase for many and employment prospects continue to improve, which means more persons are likely to have the needed income to purchase a home. Add to that a healthy inventory and, for many shoppers, purchasing a home during the holidays makes good sense.

However, before you purchase, make sure you’ve done all your homework, have your financial ducks in a row, and are completely comfortable with the decision you make. Because purchasing a home is a lifestyle choice for you and your family.

While shopping for a home on the Internet is a great place to start, it’s not the end all. It’s also important to assemble a team that includes an experienced Realtor who knows the market and can show several homes in your price range and in the area where you’d like to live. Your Realtor will help you better understand property values and proximity to work, schools, shopping and other community amenities. Also consider costs for the down payment, mortgage fee, home inspection and home appraisal fees, moving costs, homeowner’s insurance, and private mortgage insurance (if your down payment is less than 20 percent of the purchase price). Depending on the age and condition of the home, you should also consider budgeting money each year for home maintenance costs.

Another important team member is an experienced lender. Find one who can help you determine just how much you can really afford. He or she will help you know your financial limit by determining the maximum amount you can borrow and, most importantly, make sure your loan approval is in place. This will prove especially helpful should you find yourself dealing with competitive bids from other home shoppers. However, a word of caution: While it may feel good to beat out other buyers for the home you love, don’t let your emotions override your common sense so you wind up uncomfortable a year or two down the road when struggling to make payments on a house beyond your means.

Remember, purchasing a home is purchasing a lifestyle for you and your family. Once you’ve done your homework, assembled a team of professionals to help you through the process, and found a home that meets your needs and fits your budget, step up and buy it. It will make a great holiday gift.

Scott Hillman is president of Fannie Hillman + Associates, a 33-year-old Winter Park-based real estate company specializing in residential real estate sales and producer of The Hillman Report, a semiannual look at residential real estate in Orange and Seminole counties that can be viewed on the company’s website (fanniehillman.com) or by calling 407-644-1234 for a copy.