If we have learned one thing over the last 18 months, Denver real estate knows no season. This is why we advocate for you to sell this winter.
Homebuyers really don’t care if there is snow on the ground, a landscape of barren trees and dormant shrubs or below-freezing temperatures when it comes to making an offer. Completing a home purchase is no longer a spring or summer activity.
A case in point is the December statistics from the Denver Metro Association of Realtors. According to DMAR, there are nearly 42 percent fewer homes on the market compared to last year. Furthermore, the median sale price was $545,00 last month (December 2021), up 19.78% from last year.
The good news is that conforming loan limits have increased, allowing buyers to make offers on higher-priced homes with 10 percent down payments. And, people in the market for a home still have access to affordable interest rates.
While many still opt to wait until the spring and summer to list a home, there are some pretty compelling reasons to act now instead of waiting. Listed below are a few points to consider if you’re weighing the benefits of listing now or waiting a few months. Winter conditions and colder temps shouldn’t deter you from listing your home.
As much as a snowy day may make you want to stay indoors by the fire, the Denver real estate market doesn’t hibernate and neither do motivated buyers.
#1 Scarce Inventory
Your Home will Stand Out Due to Lack of Competition
Your home will stand out when there is less competition. Homes are moving fast in the Denver area. At the end of December 2021, there were a measly 1,477 homes available for sale across all 11 Denver metro counties. The median number of days a home was on the market before going under contract was just 5. That means people are making up their minds quickly and pounce on the opportunity to make an offer if they find a home that checks most of the boxes. If you price your home appropriately, it’s likely you’ll get at least the asking price if not over list price.
The influx of new listings each spring might cause your home to lose its impact, no matter how lovely it is. Putting your home up for sale in the winter means there’s less competition, and a great listing can really stand out.
#2 Low Interest Rates (Still!)
Home Buyer Demand is Strong Due to Low Rates + Buy a New Home and Get a Rate Yourself
It’s no secret the Fed will be raising the interest rate this year. What is unknown is how many times and the increments of the rate increase. Regardless, the 30-year mortgage is still very low compared to the 3.95-5.34% home buyers were looking at between 2016-2019.
Homebuyers are expected to be very motivated to buy given the impending increases in interest rates. A higher interest rate means buying power is impacted so most people want to get in on the game before they lose out on these still extremely low rates.
Lower mortgage rates typically encourage home buying, which the Denver area has witnessed firsthand since the pandemic. If you need to buy a home after you sell your current one, you will also be able to take advantage of current low rates for your purchase.
#3 Record High Home Values
Take Advantage of Large Equity Gains
According to a recent article in the Denver Business Journal, home values in the Denver area metro grew by $400 billion in the last decade. The article details the explosive growth and value of Denver residential real estate and how homeowners have benefitted from their investment.
“The metro area’s total housing market value in 2021 was $635 billion, the 17th highest in the nation and a figure that puts Denver among similar metros like Portland, Ore.; Sacramento, Calif.; and Houston,” the article states. “In Colorado as a whole, the housing market in 2021 was worth $1.2 trillion, the first time the state’s housing market has cracked the $1 trillion mark. Colorado is now one of 14 states with combined home values that high.
“The state gained the third-most market share in the country, behind just Florida and Texas. Colorado’s housing market now makes up slightly under 3 percent of the nation’s, the ninth highest. The state is still dwarfed by California, where the housing market is worth nearly $10 trillion and where one metro area, Los Angeles, by itself is worth three times the state of Colorado’s total value.”
Regardless of whether you purchased your home two years ago or 20 years ago, your investment has grown substantially. Since 1991, Denver Metro area homes have appreciated about 7.5 percent per year. According to CoreLogic, Colorado homeowners gained an average of $78,000 in home equity when comparing Q3 2020 to Q3 in 2021.
This is a perfect time to take advantage of your gains in home equity to upsize, downsize or move to that dream location, whether that means a new Colorado neighborhood or a new state.
#4 Serious Buyers
Most homes are getting 20 showings during the first week of being listed.
Braving sleet and snow to go out and look at houses isn’t most people’s idea of a good way to spend a wintery weekend. Buyers attending your showings in the winter are more likely to be serious and willing to make a quick offer. Many of these people want to avoid the spring and summer rush and get the deal done early and efficiently.
Megan Aller with First American Title takes a look weekly at showing data and reported that during the third week of January 2022 there were 24,000 showings set and for approximately 1,200 listings. This means if you list your home now, you can expect to see about 20 showings during the first week. Aller also reported that the median days on market is 4, proving buyers are serious and ready to buy quickly.
#5 Fast Sales and Still High Prices
Most homes are selling in just 5 days and for over the asking price.
Contrary to popular belief, homes put up in winter aren’t slow to sell. In fact, houses put on the market in the winter months are now selling at the same rate as at other months of the year. Denver metro homes are currently selling after just 5 median days on the market. Even more exciting? Our region’s current list-to-sell ratio is 101.53%, meaning that the average home sold for over the asking price!
For advice or questions, contact us at Usaj Realty and see how we can help you with a sale this winter, or any time of year!