Looking to buy a house this season? The leaves aren’t the only beautiful objects falling this autumn.
Now that the kids are back in school and the holidays are just around the corner, the Denver real estate market traditionally becomes a little easier for buyers. Homes are staying on the market a tad bit longer these days: in August, both attached and detached homes generally went under contract in 19 days, a 46 percent monthly increase from July. Furthermore, the close-to-list price decreased a full percentage point, indicating there is more negotiating power in the hands of the home buyer.
People are starting to see more price reductions, and home sellers who had hoped to complete their sale in the summer may now be anxious to compromise. What does that mean? Bottom line is that fall can be a terrific time to purchase a house. While interest rates continue to rise, various down payment and loan options make fall a great time to buy a home. With less competition and more inventory, home buyers have more leverage and can be more patient in selecting a home that fits their needs.
“Competition to attract buyers is heating up so expect more deals to contain a seller concession,” said Andrew Abrams, Chairman of the Denver Metro Realtors Market Trends Committee. “In July, the average concession was $5,105. Home sellers will need to use recent data to make educated decisions on list prices.”
In Denver, August saw the median sold price of detached and attached homes dip 2.5 percent month-over-month to $579,900. By the end of September and October, it wouldn’t be surprising to see the number drop again.
So before you put off buying a home, consider the following points and why you should try to seal the deal on a house this fall.
#1: Less Competition
Many buyers want to complete their home purchase by July so they can move in and be settled by the time their kids start school. By October, the “rush” is over and buyers can be more deliberate in searching for a property that really appeals to them. Often people feel they have to make a move in the summer, unfortunately, when there is more demand; conversely, in the fall, calmer heads prevail and buyers can end up with a better property that is more appropriately priced.
#2: Sellers are Motivated
If sellers put their property on the market in the spring, hoping to sell it over the summer, they are now ready to jettison the property. Even if the price is still a problem, make an offer! You never know what might happen. As my mother always said, “Don’t fall in the love with the merchandise until after you’ve paid for it.” If you can keep your emotions out of the deal-making, you’ll likely have a much better experience.
“Many of the homes on the market now are showing a more thoughtful and competitive price point,” said Jenny Usaj, managing broker at Usaj Realty. “With that being said, the seller’s motivation to get into a new home or job can work in a buyer’s favor when negotiating price.”
#3: Market Rates/Tax Breaks
There’s no getting around it: mortgage rates continue to rise. The days of a 3 percent interest rate are long gone but there are still terrific down payment plans and a variety of loans out there that will fit your unique situation. It’s time to sit down with at least a few lenders to find out what type of mortgage will work best for you.
“Buying a home is a great tax break before the end of 2022,” said Usaj. “We love to work with tax professionals to make sure that you are maximizing your options. Also, should you decide to rent your house, you can also get tax benefits and new cash flow for next year.”
#4: Gaining a Sense of Community
By investing in a home, you also establish a stake in your selected neighborhood. Owning a home opens up a whole new world to establish new friends and become part of a unique community.
Many studies have revealed that home ownership provides a variety of social benefits. Homeownership boosts the educational performance of children, induces higher participation in civic and volunteering activity, improves health care outcomes, lowers crime rates, and lessens welfare dependency.
With a home purchase comes the pride of ownership and the sense of belonging in a community where one has a financial stake in the neighborhood. Also, ownership entails greater individual responsibility … More recent studies have found that the wealth-building effect of home ownership and the sense of control it provides to homeowners in a stable housing market affect homeowners’ mental and physical health in a positive way.