Buying a home often requires a combination of financial preparedness and advantageous housing market conditions. In an ideal world, homebuyers would have a 20% down payment saved up, and mortgage rates would hover around the ten year average.
However, mortgage rates have changed drastically over the past five years, and home prices have surged in an initial post-COVID housing market boom.
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Though it is difficult to time the market exactly, the time of year buyers go house hunting can significantly impact the total cost of purchasing a home. Summer is typically considered the prime real estate season, but winter can provide substantial benefits for homebuyers.
Financial expert Dave Ramsey shares why homebuyers may be in for a pleasant surprise in February and when to know if it is the ‘right time to buy.’
Mortgage rates may still hover around 7%, but choosing a favorable time of year to close on a home can help offset elevated rates.
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February may provide price relief for homebuyers
Late spring and early summer are typically the peak home-buying season, as families try to settle in before a new school year begins in August and September. While buyers may have more inventory to choose from, these months see higher competition and home prices.
However, winter months often give buyers a more relaxed market, typically offering the lowest home prices of the year.
In February 2024, the average home price was $383,800, the second cheapest month of the year after January. Though fall months may provide the best balance of price and inventory supply, those looking to get the cheapest prices available will want to close this month.
More on homebuying:
- Dave Ramsey warns Americans on a homebuying mistake to avoid
- Housing expert reveals surprising ways to reduce your mortgage rate
- Americans buying homes may see major housing cost changes in 2025
- Finance veteran has a warning for Americans purchasing a home now
Reduced competition often gives buyers much more leverage to negotiate, as sellers hope to get their homes off the market during a sluggish period.
“Less demand for homes could give you some bargaining power when it comes time to make an offer on a house,” Ramsey wrote.
However, he highlights that the ‘right’ time to buy a home varies with each buyer’s financial position.
“But keep in mind: No one can predict real estate trends with 100% accuracy,” he continued. “So never let what month it is make or break your home-buying decision — only your financial situation can truly determine the right time for you.”
Housing price growth will rise in 2025
Home prices have increased consistently with the surging inflation of 2022 and 2023. CoreLogic found that prices have increased modestly over the past few years, but there may be a market revival on the horizon.
Related: Dave Ramsey warns Americans on a homebuying mistake to avoid now
House prices grew 3.4% year-over-year between December 2023 and December 2024, but are projected to reach 4.1% between December 2024 and December 2025.
Stagnant buyer demand stifled housing price growth, but experts predict Spring 2025 may see renewed buyer activity — and higher prices to match.
Other outside forces — such as the California wildfires and potential Trump administration tariffs against Canada and Mexico — may also contribute to the increased cost of building materials.
Related: Veteran fund manager issues dire S&P 500 warning for 2025
