Buying an investment property in the winter

New to Real Estate · Member since 2024 · 25 posts · 14 votes

I want to get started in real estate but investing but I may not be able to purchase a property until late 2025. I'm concerned that I'd buy a place in the winter, then it would either take a long time to find tenants or I would have to charge significantly less in rent to avoid a long vacancy. How realistic is this concern?

I'm looking around Connecticut or Boston, if that makes a difference.

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Corby GoadeBusiness Member

Investor · Boise, ID · Member since 2014 · 3k+ posts · 3k+ votes

You can't have it both ways. You'll get a better deal in the winter, but it'll take longer to rent. If the market was busy, you wouldn't get a good deal.

The amount you'll save off of the purchase price will be significantly more than what the vacancy will cost. Small potatoes.

I always look back at the previous year, and without fail, the best deals we get are in December and January.

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Robin SimonBusiness Member
Lender · Austin, TX · Member since 2022 · 5k+ posts · 4k+ votes
1y
It could certainly be a concern - but depends on a lot of factors - are you looking multi or SFR? I think the winter market concerns are really primarily only really worrying if you are looking at a larger SFR attracting families to due the "school year" issue - but other types of strategies I don't think its as much of a concern
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Matt Wan
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New to Real Estate · Member since 2024 · 25 posts · 14 votes
1y
Quote from @Robin Simon:

It could certainly be a concern - but depends on a lot of factors - are you looking multi or SFR? I think the winter market concerns are really primarily only really worrying if you are looking at a larger SFR attracting families to due the "school year" issue - but other types of strategies I don't think its as much of a concern

I am looking for a SFR. I assume it would be easier to offer student housing before the spring semester, but I don't think I'm ready for that.
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Russell BrazilBusiness Member
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Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
1y
Buy in the winter, and you'll pay less money for the property, but have to deal with longer vacancy.
Buy in the Spring and you'll pay a lot more money for the property, but you can fill a vacancy much quicker.
Pick your poison.
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Corby GoadeBusiness Member
Investor · Boise, ID · Member since 2014 · 3k+ posts · 3k+ votes
1y
You can't have it both ways. You'll get a better deal in the winter, but it'll take longer to rent. If the market was busy, you wouldn't get a good deal.
The amount you'll save off of the purchase price will be significantly more than what the vacancy will cost. Small potatoes.
I always look back at the previous year, and without fail, the best deals we get are in December and January.
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Matt Wan
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New to Real Estate · Member since 2024 · 25 posts · 14 votes
1y
Quote from @Corby Goade:

You can't have it both ways. You'll get a better deal in the winter, but it'll take longer to rent. If the market was busy, you wouldn't get a good deal.
The amount you'll save off of the purchase price will be significantly more than what the vacancy will cost. Small potatoes.
I always look back at the previous year, and without fail, the best deals we get are in December and January.

That's encouraging. Thanks
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David F.
Member since 2018 · 113 posts · 136 votes
1y
@Corby Goade nailed it. I agree 100% with what he said.
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Marcus Auerbach
Investor · Milwaukee - Mequon, WI · Member since 2010 · 5k+ posts · 7k+ votes
1y
I bought probably 80% of our investment properties in fall and winter. Deals are much better. It is a little slower to find a tenant, in our case maybe 3-4 weeks instead of 1-2 to get our average 10 applicants for 1 signed lease. I am in Milwaukee, very hot rental market.

Whenever you have an issue like this, think with an XLS and project dollars, for example:

- 2 months lost rent: 2 x $2000
- 5% lower purchase price: $15,000

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Brandon RushPro Member
Real Estate Agent · Portland, CT · Member since 2019 · 761 posts · 849 votes
1y
Based on my experience as a real estate agent and investor, some of the best deals I’ve seen clients secure have been during the winter and holiday season, so it’s never a bad time to keep looking for opportunities. While concerns about vacancies are valid, a great deal will often outweigh the short-term impact of a couple of months without rent, especially considering that it usually takes time to close on a property. If you find the right property, you’ll likely position yourself for long-term success, even if there’s a brief vacancy period to navigate. Keep searching for deals, regardless of the season
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Todd AndersonPro Member
Real Estate Agent · Cape Coral, FL · Member since 2023 · 392 posts · 175 votes
1y
Matt,
There is always another timeframe to alkalize or another area to look at. I think all the other seasoned investors would agree the best timing to make your first step into REI is yesterday. When you have the funds available and you find a deal that works, that is the right time.
With the new investors that I work with the biggest step is saying yes when you are ready. In a buy and hold investment strategy for building wealth. having the first month vacant in a 10 year hold is a blip on the radar.
Best of luck getting ready, use the time that you are getting the funds available to look at deals.
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Jonathan BombaciBusiness Member
Real Estate Agent · Lowell, MA · Member since 2019 · 1k+ posts · 1k+ votes
1y
@Matt Wan In my opinion, there is never a bad time to buy the right investment property. While it is true that the time of year can influence market activity, as others have mentioned, there is usually a trade-off depending on the season. In tight inventory markets like Boston, I encourage clients to clearly define their purchasing criteria, start looking, and then be patient.

Some of the best deals I have seen or experienced personally happened during unusual circumstances. For example, properties became available at the onset of COVID, during a snowstorm, a hurricane, a major holiday, or after some other unexpected event. Opportunities often arise when others are not paying attention. The key is to be ready, wait for the right property, and adjust your offer based on the strategy you want to deploy.

The time of year is less important than the property itself. If it is the right investment, focus on how you can negotiate the best terms or tailor your offer to the situation. If you find the property in mid-January but don't want to close with snow on the ground, then submit your offer with a 60 day closing and you'll be purchasing it going into spring. Be flexible and keep an eye out for opportunities, as they often come when you least expect them.
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Tom Thomson
Member since 2019 · 57 posts · 34 votes
1y
Buying in the winter you can get a better deal. I have done this a few times. Get a little bit less in rent for the 1st tenant but always willing to do either a 6 or 18 month lease to swing renewal time back to the summer.
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Tyler MunroePro Member
Boston, MA · Member since 2017 · 89 posts · 42 votes
1y
@Matt Wan In the Boston area the inventory is so tight I'm not even sure there's "deals" in the off season. I think you'll just generally have less competition, so your chances of landing a property are higher, but I'm not seeing any bargains due to seasonality like there used to be. If you do land one in the off season, build in 2x as much vacancy as you think or about 20% less rent than market for the first year. You may also have to pay a broker to rent it, when usually the tenants cover that during peak rental season (May-July for 9/1 leases).
Good thing is once it's rented you should almost never have vacancy if you're mindful of re-listing it in a timely fashion. I've owned property in the Boston area since 2013 and have never had a vacancy aside from when I was doing renovations.
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V.G JasonPro Member
Investor · Member since 2022 · 3k+ posts · 3k+ votes
1y
My opinion-- buy in the winter, underwrite with an extra long vacancy, get some seller concessions to defeat the cash flow if it's really that tight. If it's really that tight, first see if you're fit to invest.
Going forward, I am a post labor day to spring break REI guy. Outright buyer, and in the future net buyer.
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Alecia LovelessPro Member
Member since 2019 · 3k+ posts · 2k+ votes
1y
@Matt Wan I’ve gotten my best deals in the winter.
I’m a couple hours north of Boston but there’s always tons of people looking to move so a longer vacancy or having to lower my rent prices is not even a consideration.
Buy when you can and it makes sense. It’s a long game so worrying about the short term is kind of pointless.
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Stetson Oates
Member since 2024 · 65 posts · 63 votes
1y
It's good that you have thought about this, but its really a non-issue. Just shorten the lease to a 6 month, or whatever term lands you in the spring/summer for renewal. Just let the tenants know why you are doing it and explain they will be renewed (if you like them) no problem. Good question to post though!!
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Steve KenneyPro Member
Investor · Auburn, ME · Member since 2015 · 72 posts · 45 votes
1y
I think there can be some great deals out there in the winter months. If the deal makes sense I think the pros will outweigh the cons. The property may not have any vacancies, but if it does, just make sure you have enough reserves to cover that.
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Billy Smith
Shawnee Mission, KS · Member since 2016 · 719 posts · 313 votes
1y
I only invest in A and B areas that usually makes renting some what easy .Having rentals loaned out to the wazoo can cause a lot of stress on owners to rent out immediately .If the market softens up winter etc... I can wait it out from having properties paid off .
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