I'm looking to 1031 exchange a California property for a few cash flowing properties with a turn key company. I was told to avoid buying in winter months because it's hard to find tenants during those months. Should I wait until spring?
Depends on your area. In my area, which is rural with a large military base, it is definitely an issue. I can find tenants, but not good tenants. My "season" around here is April thru July. The military folks PCS (permanent change of station) in April and school starts the first week of August.
That said, the best BUYS, are typically in the September/October/Early November timeframe. Why? You guessed it, people realize that they missed the "window" and start lowering prices.
I would say when to buy depends on the type of property you are buying and the type of tenants you want to attract. If you are buying turnkey properties in class A neighborhoods for young professionals where rentals are hot right now, it may not matter. If you're like me in a rural area, buying class C homes (ugly but good bones) for class C families who want to be settled prior to school starting, with rehab work that won't get finished until just before the holidays, you may not want to risk it.
I do have one question though, if the new properties are "cash flowing properties", aren't they already rented? Then it doesn't matter what time to trade....
@Jasmine C. the winter months are slower in the Midwest when it comes to filling a vacant property. You should keep a close eye on your market to see if the inventory of homes is increasing by a large amount. You can ask a realtor to send you data on the supply of homes. Once the supply has increased by a decent percentage then you know price appreciation will slow down or slow. Time to sell.
You could always look to buy a property already rented if you have to buy properties in the cold weather states during the winter. Just ask for copies of the leases to see how long they have been living there. I have a rental in Kansas city and it was tough to rent in March but once it was a little warmer I obtained a tenant right away
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