Home Buyer in Colorado –Why now might be the time to do it!

It’s been a difficult year to be a homebuyer in Colorado. Between the high demand for homes, not enough homes coming on the market, and the competitive bidding wars, you or someone you know may have thought it was impossible to buy a home recently.

Fortunately, there has been a shift in the market, albeit slight.  It’s as though the market cracked opened the door signaling to buyers that it might be safe to enter again.  

For the first time all year, it’s becoming a better time to be a buyer.

Here are some reasons why.

Longer Days on Market

Our average days on market are up ever so slightly. This means for the most part, you don’t have to rush out at 8 pm on a Thursday night to see that house you love. 

Homes are still selling fast, but not at the “feverish” pace earlier this year. 

When homes stay on the market longer, even slightly, the number of bidding wars and/or the competitiveness during the bidding war eases. 

Fewer Bidding Wars

As a result of this slight easing in the market, bidding wars are easing too.  Bidding wars are at their lowest levels since last year.

Don’t expect no competition, however instead of those 19 offers you might have been up against in Spring, you may be up against 1-2 other people.

I have had 4 listings in the past month and what I have see is still multiple offers in smaller amounts. The appraisal gaps are smaller then in the Spring and buyers aren’t waiving their rights to inspections and appraisals like we saw in the Spring.

Favorable Mortgage Rates

The interest rate on your mortgage plays a significant role in which houses you can afford. Generally, the lower the mortgage rate, the better since even a difference of just half of a percentage point can add up to tens of thousands of dollars over the life of the loan and hundreds of dollars per month difference in payment for the same-priced home. While your credit history plays a role in your mortgage rate, the broader market conditions are important, too.

Currently, mortgage rates have been rising in recent weeks but overall they’re still at historic lows.  

As of the last week of October, the average mortgage rate on a 30-year fixed mortgage was 3.24% and on a 15-year fixed mortgage, the average was 2.49%. Freddie Mac, a leading mortgage lender and researcher, published a mortgage interest rate forecast recently that indicates the 30-yr rate will rise to 3.5% by the end of 2022. That might sound like a small jump but it can make a big difference when you’re dealing with hundreds of thousands of dollars. 

So, interest rates rising right now is no reason to panic buy to “beat” rising rates, but something to factor in as time goes on. 

What’s Going To Happen Next when you are a home buyer in Colorado?

It’s important to note that housing market conditions are ever-changing.  The slight softening of the market could be temporary or could be a sign of things to come. 

Barring any personal timing reasons, it’s ideal to buy a home when mortgage rates are low and there is less competition. Remember too, that while things are cooling we did still see those significant housing price jumps throughout Spring and Summer, so expect that if you were looking in the spring you may need to adjust expectations on what you can get for your budget!

This moment is the first time all year we are seeing a slight lean in the favor of buyers with the low rates, more inventory, longer days on the market, and fewer bidding wars.  That’s why right now is a great time to buy a home, especially if you were outbid earlier this year, got frustrated, and put your purchase on hold or talked yourself out of it earlier this year. 

If you or anyone you know has sat out being a home buyer in Colorado over the last year, now might be the time to jump back in and I’d love to help make it happen. Feel free to shoot me an email at haley@youraussieagent.com and let’s chat about getting you into a home over the winter months!