When is the Best Time to Buy a Condo?

When is the best time to buy a condo is a question I get asked frequently. Although there are a number of factors to look at in the market, the best time to buy is usually when you are ready.

Before we look at the market factors, let’s define ‘ready to buy’.

By ready, I mean several things:

• You are ready financially. You have met with a lender and are pre-approved. You have enough money for the down payment and closing costs.
• Your credit is in good shape. You can still get financing with poor credit - but it will cost you. Depending on your situation, you can improve your score over a few months and get much better financing terms. If that is the case, it might be better to hold off a bit.
• You have a steady job. Without a job (or other source of income) you won’t be able to get financing, unless, of course, you are paying cash. If you are concerned with good reason that your job might be in jeopardy or you might get transferred soon, it might be better to hold off.
• You know where you want to buy. Maybe not exactly which building, but at least narrowed down to an area, such as the Orange Line Corridor or Shirlington or Crystal City.
• You have seen enough places to have a sense of what you want. Looking on line is a good place to start but you really need to see places in person.

Now, let’s look at some of the market dynamics.

Looking at the sheer number of sales by quarter over the past 3 years, you can discern a definite pattern. The second quarter of year (Mar-Apr-May) is clearly the busiest with the most closed sales, followed by Q3, then Q4 and lastly Q1. In fact, Q1 can be 50-60% of Q2, which shouldn’t be a big surprise as a harsh winter can keep people inside.

But what about pricing? Looking at the same 3 year period, there is no discernible pattern:

What about Days on Market? Not surprising, the 2nd & 3rd quarters are always the busiest and have the shortest days on market.

Some people think you should avoid buying in the Spring market because it gets overheated and bidding wars break out. While it is true there is more competition in the Spring market, that is also the best time to find the right place as you will have more to choose from.

Some people think it is best to wait until the end of the year to find a bargain. Their logic is that only serious sellers will have their home on the market during the holidays and they will be motivated. The problem with that approach is you have very little to choose from.

Don’t assume just because it is the end of the year and the place has been on the market for awhile that the seller will now be motivated. They might be, but they can also be the most unmotivated - their price and expectations are too high, which is why they are on the market for so long.

I often find the most motivated seller in the Spring. They have already put a contract on a new home and they need to sell their current place. They may have already written offers on several homes before landing one and they don’t want to lose it.

So, when is the best time to buy a condo? When the time is right for You!