Much has been given to the past 6 months of rising interest rates. Inflation, by its very nature, is the rise in price of a good or service. From the onset of the pandemic, the Federal Reserve had to counter the actions of Congress and that of the home-buying consumer. Once the air was clear, and the reopening of the economy was underway, the Fed acted to counter unprecedented Congressional spending. Inflation has not been transitory. Those who refinanced their home during or before the pandemic locked in historically low rates for long-term upside. To move from a home already deemed sufficient has removed supply that otherwise would have met the rise in demand for a home.
In Colorado, historic home values have occurred because some people had finally made the move to the state. The lack of labor and the lack of available domestic and international supplies to build new homes has been the fundamental cause of firm housing prices locally – and nationally. Mark Zandi, of Moody’s Analytics, noted nationally that unlike 2008, the American housing market is not overleveraged and not experiencing any noticeable uptick in foreclosures.
While expecting prices to cool, the hyper bidding found in Denver’s market has been over for at least two months. As a home seller, your expectation for a 5-day listing is likely over. The normal real estate market of approximately 60 days is on its way. Realtors expecting a fast sale should find more data to prove their misguided expectations.
What is normal for the Denver metropolitan real estate market? Approximately 26,000 homes would need to be available at any one time to meet what Megan Aller with First American Title deems as a balanced market. Below that, the seller has the upper hand. When dealing with a licensed realtor, like those at MASONmodern, you will find that certain homes at certain prices have different dynamics at play.
The new home buyer reliant on a mortgage is not the same as a non-mortgage buyer. With luxury home sales, the need for a mortgage may not be at hand. As always where a home is located remains as firm today as ever in relation to its demand and the price at which it can be sold.
Moving from or to Denver? Considering Hilltop, Cherry Creek North, Crestmoor, Washington Park, Cherry Hills, Greenwood Village, The Golden Triangle, Downtown or Lohi? Speak with Mason Hayutin @masonmodern.com