Denver Market Update
- January started like a Rocket with more competing offers, appraisal gap language, inspection waivers, free post-closing occupancy agreements offered, earnest money going hard and every other trick buyers, with help from their agents can think of. When they find the right one, they need to put it ALL on the line because it may be another month or so before they find another home that they like. The worry for buyers right now is higher interest rates and the expected 10% appreciation gain likely to happen by years end.
- Our market has escalated in anticipation of an interest rate hike, that coupled with another month end inventory (or lack there of) number (almost 50% lower than this time last year) is seeing homes go under contract at 10- 25% over asking price. I have clients out there and trust me we see it every day.
- Is cash always King? Some positive news for buyers is that a local title company, First Integrity reported that Cash deals crash 5.7% more often than financed purchases indicating that cash isn’t always King.
- New Build News: To counter rapid growth in prices and reduce risk, new home builders are selling more spec inventory rather than dirt starts. Additionally, builders are including language that would allow the builder to increase the base price within the first few months of a new contract.
- The Marshall Fire area are still seeing home sales move just as quickly as the rest of the market here in Denver. Last month there were 17 homes under contract that sold withing 2 days of being on the market.
- The average active listings number for January is 12,732
- The record high was recorded in 2008 for January of 24,550
- January 2022 set a new record with 1,184 active listings
- Historical average decrease from December to January is 5.3% this year’s decline was 19.84%
When we look into the Crystal Ball I think what we see is interest rates rising and demand for housing softening a little. Then soon there after inventory coming back on the market and interested rates going back down again fueling housing demand again. Not sure when we can count on this happening but possibly by the fall of 2022.
In conclusion, Buyers hold on!! As professionals we feel for you and are working hard to figure out ways to get your offers accepted without losing your first born. Lenders are also working hard to make your offers stronger with loans that can close in under 15 days. If we can answer any questions or if you would like to meet up to talk strategy please click the link below!