Whether out to lunch with co-workers or at a backyard barbecue with family and friends, the state of Colorado’s bustling real estate market is on many people’s minds. Colorado continues as one of the stronger states in the nation when talking about economic growth, population growth and a healthy real estate climate, and increasingly, questions about available inventory for sale has become a part of everyday conversation: How is the real estate market performing? What are interest rates doing? When is a good time to buy or sell?
Today, the economic rule of supply and demand plays an important role in understanding our current real estate market. Simply stated, the low supply of inventory combined with a high buyer demand to purchase is creating a market where values will continue to increase.
The question becomes, what does this mean for me? Well, it depends. Sellers are experiencing an opportunistic time in Colorado real estate with the influx of people to the state and limited number of inventory for sale, which drives home values up. Good news for current home buyers is that mortgage rates are expected to stay low, and Colorado’s effective real estate tax rate is on the low end; 0.62 percent according to a new report compiled by financial analyst site, WalletHub.
Whether you are in the buying or selling position, it is important to be informed and know where you stand to best navigate the current market, which will ultimately determine your success in Colorado’s real estate market today.
Lenders are confirming that the current home selling season is off to a busy start, and according to The Wall Street Journal’s “This Spring, Expect Higher Home Prices,” (March 10, 2016) article, buyers need to get into the market sooner rather than later to avoid closing delays.
According to Keith Gumbinger, vice president of HSH.com, the 30-year fixed-rate mortgage will not likely rise above 4 percent before May. It is also suggested that buyers get pre-approval (a step above pre-qualification) for a loan prior to home-shopping, which by doing could save home shoppers up to 10 days at closing.
According to Lawrence Yun, chief economist for the National Association of Realtors, buyers are anticipated to outnumber sellers this spring, creating a shortfall in inventory that will continue to drive up asking prices.
According to a report from the National Association of Realtors (NAR), the United States experienced an average price appreciation in home values of 5.4% in 2015, significant growth despite the statistic that the consumer price index rose by only 0.4%, suggesting inflation was fairly flat. Housing shortages have become the rule in most states and there is little reason to expect much change in 2016. Colorado continues to serve as a highly desirable place to live and offers a very healthy real estate climate, however, like the lottery, you can’t win if you don’t play.