First, the market is finally shifting after years of being a rabid seller’s market. For years now, buyers have been fighting to get in on one of the hottest real estate markets in the Country. Often, we’d see sellers receive multiple offers above asking price in the first weekend. Homes were consistently selling way above the appraisal price. However, as the Denver Post recently noted 2018 saw a drastic shift from a sellers’ market to a buyers’ market. Inventory is up and time on market is as well. The days of multiple cash offers in the first weekend are behind us.
Second, the Denver housing market is strong and showing little signs of slowing. The economy in Denver is strong, and the population growth has been consistent. Real estate, unlike other financial vehicles is finite. Meaning there is only so much land to build on and only so many homes to sell. With more people moving to Denver every day, and rents consistently increasing the demand for homes remains, and thus prices continue to improve. Yahoo recently published an article detailing 54 cities that are in danger of a housing crisis. Denver, with just 6 percent of mortgages underwater ranked the 6th lowest on that list.
Third, interest rates are still low, but for how much longer no one knows. The Federal reserve has been teasing a rate hike for a long time now. Instability in the Government and the stock markets only serves to flame these fears. However, we have not seen that come to fruition just yet. In fact, CNBC recently reported that after “a sharp drop in interest rates to the lowest level since April” we saw a 23.5% spike in mortgage applications. As I mentioned, savvy buyers know now is the time to lock in these rates.
In summary, between a recent shift to a buyer’s market, a continued strong growth of the Denver housing market, and a recent but potentially short drop in interest rates, now is a great time to be a home buyer in Denver.
Prior to getting into real estate I spent over 6 years as a futures trader. One thing that I learned in that time is that one of the most common mistakes investors make is trying to perfectly time the market. Everyone wants to buy the lows and sell the highs. However, that is nearly impossible. Instead you need to find the right opportunities and take advantage. By trying to perfectly time the bottom, many investors end up staying out of the market altogether, which I believe is a mistake. Every month spent paying rent and thus someone else’s mortgage for them, instead of investing your money into building equity for yourself could cost you big time in the long run. If you are interested in a free buyer consultation, please don’t hesitate to contact us anytime.