Thinking about purchasing a house this year? Here’s why now is the perfect time to act.

Why January Is the Best Month to Buy a Home

Even if the weather is less than ideal, putting on your winter gear and heading out to look for a house in January could be a smart financial move. According to LendingTree, this month consistently offers the best deals for homebuyers.

Based on LendingTree’s analysis of housing data from January 1, 2015, through December 31, 2024, January stands out as the month with the greatest savings. Buyers can expect to pay, on average, $23,400 less for a 1,500-square-foot home compared to purchasing in May, which is typically the priciest month of the year.

For first-time buyers, this potential savings is especially significant. Many newcomers to the market don’t have a property to sell first, making these lower prices even more appealing. The National Association of Realtors reported that in the previous year, only 21% of buyers were purchasing their first home—a record low—while home prices remained close to historic highs. This is a sharp drop from the long-term average of 38% since 1981.

Matt Schulz, chief consumer finance analyst at LendingTree, notes that buying in January can reduce the purchase price by tens of thousands of dollars, potentially making homeownership possible for those who might otherwise be priced out.

Extra Ways to Save

Schulz also points out that lower home prices in January can lead to additional financial benefits. For instance, it may be easier to make a 20% down payment, which is a key threshold. Reaching this percentage allows buyers to avoid private mortgage insurance (PMI), which can significantly lower monthly mortgage costs.

Typically, lenders require PMI if your down payment is less than 20% of the home’s price, as a safeguard against default. The cost of PMI is usually added to your monthly mortgage payment, so avoiding it can make a big difference in your budget.

What If You Miss January?

If you’re unable to buy a home in January, don’t worry—February is the next most affordable month. LendingTree reports that the average price per square foot in January is $178.60, with February close behind at $183.70. Prices then climb each month, peaking at $194.20 per square foot in May before starting to decline again.

Here’s a month-by-month look at the average cost per square foot to help you plan your search:

• January: $178.60
• February: $183.70
• March: $187.90
• April: $190.50
• May: $194.20
• June: $193.40
• July: $190.30
• August: $189.70
• September: $187.40
• October: $189.40
• November: $188.10
• December: $187.40

Does Home Size Affect Savings?

According to the data, the size of the home doesn’t impact the trend—January consistently offers the lowest median price per square foot, regardless of property size.

Are There Drawbacks to Buying in Winter?

While winter can mean less competition from other buyers and more flexibility from sellers, the selection of available homes is usually smaller. LendingTree found that between July 2016 and June 2025, February had the fewest listings at 7.1 million, while July saw nearly 10 million homes on the market.

Considerations for Winter Homebuyers

Schulz advises that while the savings in January and February can be substantial, buyers should be aware of potential risks. There may be fewer properties to choose from, and if you’re selling, you might not get top dollar for your home.