Before I spew some numbers and talk about how they suggest trends, I’m going to start with the answer first then a little about stats.
First of all, our market is nuts for both buyers and sellers. The extreme imbalance of our sellers market makes it a very interesting time to buy and sell.
What is coming in the Denver Real Estate market is change.
No matter the market, the only thing we can count on is change. Buyers, Sellers and Agents always adapt to the existing market conditions in an effort to maximize their opportunity in the market. That fact in itself forces change even if the the market metrics do not change.
Buyers are taught by agents how to create competitive offers. The current structure of winning offers then becomes the norm and good agents create another way to ensure their buyers get the home they want at a price they want. This is just human nature.
What is coming to the Denver Real Estate Market is going to be a shift based on the scarcity of available homes.
Rate Change: Many buyers are motivated by quickly appreciating homes, the media coverage of the seller’s market and low rates that cannot last. Once we see a significant rate change that is large enough in a short period to make an impression, some of the false urgency for getting low rates will subside. In short, a rate change of 3/4 to 1% point in 30 days will cause all but the truly motivated to wait and watch rates. This will be an opportunity. More on that later when it happens.
Seasonal Change: Every year starting in July and ending in December, home that were over priced or below average for condition will start to last longer on the market. Over the past two years, the market has generally absorbed this inventory because inventory levels have been so low. In short, anything has sold. This too is an opportunity. Look for homes longer than 30 days on market and look for the right price to make it a good buy. Have a professional Realtor show you the after repair value to help you deduce the correct purchase price. Look for these deals starting July 4th of every year.
New Home Sales: No matter what happens to our market and rates in the next 12 months, expect new home building pace to continue at high levels. Because these home starts take months to years to initiate. Most builders that felt the market collapse of 2007 had no choice but to continue to build and recoup development and building costs. This too is an opportunity if the rates bump and the market stalls.
Those are my predictions.
Here is where we are as of July 2015. Within E470 / Metro Denver, we have 1.04 months of inventory. Average days on market remains at 22. Buyers are writing “as-is” offers and some are waiving appraisal conditions. Great agents cold call to find buyers homes.
If you are considering the market to buy or sell, it is a GREAT market, just a little unique. The good buys are not where they were two years ago. The terms that used to win with sellers no longer work.
Let me know if you would like an up to the minute overview of what works and where to buy.