Is Winter really a bad time to buy your first rental property?

Question

I've heard previously that it's difficult to fill vacancies in rentals during the winter, especially in Michigan, because of the harsh weather and no one really wants to move during these times. Is this enough to postpone buying the first rental until weather warms up or is this difficulty not really an issue? Is it really that much more difficult to fill a SFH in the winter because the weather?

There's always the option to purchase and inherit a tenant, but i'd be hesitant on that due to things like- not sure how good of a tenant they are, what the lease consists of (can always take a look before purchasing), etc.

Jerry W. · Answer

@Nader Hachem, In my area the issue of does it already have a tenant in it or is it winter is not the deciding factor on whether I buy it or not.  Look at property value, location, quality of house, etc.  Don't let a $10 item deter you from a million dollar property.  Deals are not so common right now that I would be particular.  Can you think of a time of year where a seller would be more motivated?  One tip though, when I buy houses in winter or have a tenant move out in winter I make my new lease renew in early summer.  I give them the option of a 3 or 4 month lease or a 15 or 16 month lease.  I also have a clause in my month to month rentals that the months of November through March 1, require 60 days notice from both sides, not the normal 30 days.

Nathan Gesner · Answer

There are challenges to renting in winter, but it happens all the time. I'm in a cold climate (northwest Wyoming) but we still manage to find new renters and keep vacancies low.

Linda S. · Answer

@Nader Hachem

Remember with any rental-- you only need ONE (1) person/family!    Yes, winter is more challenging ( I call it the dry month for a reason), you may need to do a move-in special, but people will move!   If it's priced correctly, someone will want it!   Peoples leases end at different times,  people get frustrated at different times-- so yes, there is always demand IMO.

I would not postpone buying it, as on the flip side-- less activity means contractors will be more available, and you may get better deals for work!  My GC always calls me up in January/February asking for work for his guys,  even if it's small--- just to keep them busy!  He quoted us $1200 on a roof sealant job (already repaired) in November, and we paid $650 in January.

Justin Brickman · Answer

I agree, just stay active. It's too hard to time the market. If It's a "bad time" that just means there's less buyers which is good for you

Eliott Elias · Answer

It's hard to fill vacancies but it's easier to get a good deal.

Paul De Luca · Answer

@Nader Hachem

It's not necessarily a bad time to buy your first rental property during the winter. Generally speaking there's less competition and inventory so you may be in a position to negotiate a better deal, depending on your market. If you wait for warmer weather in the spring and summer you're going to be competing against a larger pool of buyers but there will also likely be more listings available.

I would be conservative with estimating the rent though. People still sign leases and move in the winter so the key is to stand out amongst your competition. Maximize the exposure of your listing, take good photos, and have the rent reflect the value your providing based on the comps.

Personally I prefer to buy vacant properties so I can screen the tenants myself and if I want to make improvements to the units I can do that immediately & sign the lease for market rent. Oftentimes inherited tenants have below market rents and like you said they may come with baggage & you don't know if they are a good tenant.

This past summer I bought a house hack with inherited tenants and it was a struggle to get the tenants to commit to move out dates & it took longer for them to leave than I had hoped. And then I discovered one of the units had to be treated for bed bugs so that wasn't a nice surprise expense.

Nader Hachem · Answer

Awesome to know! It seems like there's advantages and disadvantages in both the winter and summer. Definitely going to go out and get that first property

Drew Sygit · Answer

Usually the better deal you get offsets any higher vacancy.

Drew Brown · Answer

In the current market for central michigan it is still fairly easy and quick to fill vacancies. The demand is still higher than supply for good clean rentals.

Yes the winter months do decrease movement because of temps. Also typically December is harder for people to come up with deposit and first months rent because of Christmas. In all, michigans job market is still strong and people are still looking to move up, so have a good clean property is a selling point for investors who are willing to invest.

Is Winter really a bad time to buy your first rental property?

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