Dave Ramsey Says It Takes 4 to 5 Months to Buy a Home. Here’s Why It Might Take a Lot Longer Today

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The process of buying a home can be lengthy. Read on to see how low inventory might extend it even more so today. 

Buying a home isn’t something that happens overnight. Rather, there are different steps you’ll need to tackle to become a homeowner.

First, you’ll need to search your local market and find a place that meets your needs. Then, you’ll need to negotiate with the seller in the hopes of getting your offer accepted. Once that happens, you’ll need to shop around for a mortgage. And once you put one in place, it can easily take 30 to 60 days to finalize that loan and close on your home.

All told, financial guru Dave Ramsey says buyers should expect the home-buying process to take four to five months. He breaks that down as two to three months to find the right home and another one to two months to go from contract to closing.

But of course, that’s just a rough average, says Ramsey. There are different factors that might cause the process of buying a home to take longer. And these days, a lack of housing inventory might leave you in a position where it takes much longer to go from wanting to buy a home to actually moving into a property that’s yours.

Low inventory is slowing things down

As of February, there were 980,000 available homes on the U.S. real estate market, according to the National Association of Realtors. That represents a 2.6-month supply. For context, it usually takes at least a four-month supply of homes to balance the housing market. And often, a six-month supply is needed to fully meet buyer demand.

Clearly, we’re nowhere close today. Not only does that give sellers an advantage in today’s market, but it also means that it might take you a lot longer than usual to find a suitable home to buy.

It’s one thing to have 15 properties to choose from within your target neighborhood. But these days, if you’re only looking at four or five properties, your chances of finding a home that meets your needs are lower.

And even if you do manage to find a home you can see yourself living in, remember that you’re probably not the only person looking to buy in your neighborhood. You might find a great home that three other buyers are willing to pay a premium for, too.

That’s why buying a home today might require a whole lot of patience on your part. And you should definitely gear up for the process to take longer than it normally would.

When will housing inventory pick up?

It’s really hard to say. These days, mortgage rates are higher than they’ve been in years. Meanwhile, many existing homeowners are sitting on lower mortgage rates they locked in during the pandemic. A lot of those people are going to be hesitant to sell their homes in an environment like this.

As such, today’s low real estate inventory levels might be with us for quite some time. So anyone looking to buy a home should prepare to spend more time from start to finish.

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