How Long Does it Take to Buy a House on Average?
Reader question: “We are planning to buy our first home in 2016, and we are wondering what to expect in terms of the time frame. How long does it take to buy a house, on average?”
At a glance: It can take anywhere from six weeks to six months to buy a home, or maybe even longer depending on the circumstances. As you will soon see, there are many variables that can affect the time frame of your home buying process.
How Long Does it Take to Buy a Home?
It can take anywhere from several weeks to several months -- or even longer -- to complete the buying process. There are many variables along the path a home purchase. Every buying scenario is different, because every buyer is different. With that being said, there is an average time for the various steps you will encounter along the way. So let's talk about those steps.
Getting Pre-Approved for a Loan
Mortgage pre-approval is when you go to a lender before you have started shopping for a house, in order to find out how much of a loan you can get. The lender will examine your current debts, income, and other aspects of your financial picture. Then they will give you a maximum loan amount. Learn more about it.
This process usually only takes a few days to a week. But it can stretch longer. And, as the “pre” name suggests, it happens on the front end of the home buying process, before house hunting.
If you don't get pre-approved, it might take even longer for you to complete the home buying process. For example, if you were searching for homes in the $400,000 price range, but you're only qualified for a $300,000 home loan, you are essentially wasting your time and making the process take longer. So by speaking to a lender ahead of time, you can expedite your home purchase.
Finding a Real Estate Agent
How long it takes you to buy a home will also depend on the real estate agent you choose. Real estate is like any other industry, in the sense that there are superstars and less-than-stellar performers.
If your agent is a real go-getter, it will likely take less time for you to find a suitable home and close the deal. On the other hand, if you end up with the kind of real estate agent who drags his or her feet, your process could take longer.
It might take you anywhere from one day to one week to find an experienced agent. Get references from people you don't trust. And when screening agents, ask them how long it typically takes for their clients to buy a home. If you're on a short time line, ask what they can do to help expedite the purchase.
Shopping for a Home
House hunting is often the longest stage of the home buying process. During this step, you will use the Internet, your agent, and good old-fashioned driving around to find homes that potentially meet your needs. Screening homes online is always a good idea, because it prevents you from wasting time viewing houses that don't check all of your boxes.
How long does the house hunting process take? This depends on how much time and effort you put into it. People who work full time often have to limit their home shopping two evenings or weekends. People with more flexibility built into their schedules typically find homes faster, simply because they can put more time into the search.
On average, the house hunting stage can take three to six weeks. But it can easily go longer in larger markets with a lot of inventory, and for buyers who are limited to weekend searches.
Negotiating with the Seller
Real estate purchase offers typically have a 24- or 48-hour window. The sellers use this time to evaluate the offer and decide if they want to accept it. If they don't accept it, there's a good chance they will come back with a counteroffer.
The buyer can then accept the counter, submit a counter offer of their own, or walk away from the house. The negotiating stage of the home buying process typically takes less than a week, but it can stretch longer if there's a lot of back-and-forth negotiating.
Mortgage Underwriting and Approval
If you're using a mortgage loan to finance your purchase, the mortgage company can also affect how long it takes to buy a home.
Once you have signed a contract to buy a house, your loan application file will move to the underwriter or the underwriting department. The underwriter will carefully examine your files to make sure it meets all of the lender's requirements, as well as any secondary requirements such as FHA or Freddie Mac.
How long it takes can vary based on how smoothly it goes. Some borrowers sail through the underwriting process, while others have to resolve conditions set forth by the underwriter. The process can take anywhere from one week to three weeks, partly depending on the borrower's qualifications.
Escrow and Closing
The period of time between offer acceptance and closing is referred to as escrow. The escrow process is generally 30 to 60 days, on average. But it can be longer than that. It's up to the buyer and seller to negotiate on the settlement/closing date.
During this time, the home buyer will typically have a home inspection completed, and possibly other types of inspections as well. The mortgage lender will have the home appraised to make sure it's worth at least what the buyer has agreed to pay.
At the end of the escrow, the buyer and seller will attend the closing process and sign all of the necessary paperwork. The closing process itself typically only takes one day, unless there are paperwork snacks to be resolved.
As you can see, there are many variables that determine how long it takes to buy a home. If you are a proactive home buyer, and everything goes smoothly for you, you could find and purchase a house in two months or less. On the other hand, if you have trouble qualifying for a home loan, or you have trouble finding a suitable house to purchase, the process could stretch on for six months or more.