While the weather in Colorado may not be heating up, the real estate market is. All across the front range we're seeing an increase in activity - Denver is back in full swing and Colorado Springs is following it right behind. Here are the factors causing this:
- People are mentally adjusting to the new normal, which is higher rates. I think a lot of people have been on the fence about buying and anticipating a dramatic rate drop, but it's just not happening. While we may see the fed do a rate drop sometime later in the Spring, we're in this 6-7% for awhile.
- Seasonality - traditionally real estate slows down dramatically right around early November then picks up in March.
- While rates might be high still, prices haven't gone down in fact they're rising. Today's $500K house will be more expensive next year.
- Inventory is still very low which is causing a scarcity based buying frenzy, there just isn't enough on the market.
What we're seeing is the setting for a perfect storm. Every time the rates drop, the number of mortgage applications skyrockets. If we see a rate drop with while inventory stays low, we're going to go back to the crazy selling season. We're already starting to see multiple offers on properties, decreased inspections items and appraisal gaps in Denver....it's heading towards Colorado Springs quickly. While we've been able to get sellers to help buy down rates for the last few months, that window seems to be closing.
Any questions? Let us know!
Photo by Daiga Ellaby on Unsplash
