Warm days and the blue skies of summer are upon us! And real estate hums along, full of twists and turns as always!
We've been spending our days house hunting with buyers, consulting with sellers, listing properties, birding, and planting pollinator plants in our free time. And, of course, hanging with Scarlett and our weiner dogs.
The real estate market this year is shaping up to be a somewhat unpredictable one. If you or someone you know will be buying or selling a home this year, here are a few things to know about the market of the moment.
5 things to know about the 2024 summer market:
1- The number of homes for sale is finally increasing: As high interest rates and other concerns about economic conditions weaken buyer demand, inventory levels have started to increase. Across the Denver Metro/Boulder County market, the number of homes for sale is up 28% year over year.
2- There are pockets of opportunity for buyers. Higher inventory levels and weaker buyer demand are translating into a market in which buyers have negotiating power. Aside from entry-level housing, where things are still slightly seller-favored due to a still sizable buyer pool, buyers at higher price ranges are able to negotiate more than in years past and are having success in negotiating lower purchase prices, interest rate buydowns, and getting inspection items covered.
3- If you are selling, this is the market to do as many of the fixes on your to-do list as you can. In years past, sellers could skip many minor repairs and updates as buyers were willing to take those burdens on just to win the deal. As the number of homes for sale increases, sellers are having to do more to impress home buyers. Things like older carpets, dated finishes, scuffed paint, or an unkempt yard will often be enough to send a buyer offering on a different home. The onus of "dressing to impress" has been moved firmly to sellers this year.
4- There are financing tools and strategies available to mitigate the higher interest rates and make moves easier.
-Buyers are using tools like 2/1 interest rate buydowns to lower interest rates for the first two years until they can hopefully refinance into a lower payment.
-Sellers are using bridge loans to remove the need to try to conduct two sales at the same time.
-One benefit of a more balanced market is that contingent offers, where sellers can buy and sell at the same time, are more likely to be accepted than in years past.
5- Patience is key for sellers. As the market has shifted, the average number of showings per listing has reduced. While sellers used to be overrun with showings, now we expect more modest showing and contract activity. There are serious buyers out there looking, but for the most part, the frenzy of buyer activity that defined the market a few years ago has subsided.
If you need to sell your home and slower market conditions have you feeling concerned, keep in mind that the conditions that could make your sale more challenging than in years past will translate into opportunity on the home you end up purchasing. In any market, there will always be some amount of imbalance where you'll have an advantage on one side of a transaction and not on the other. The key to navigating this year's market is to get your win on the home you're purchasing so that the concessions you may need to make on the sale of your property don't end up feeling like an overall net loss.
Until next time!
Ken and Allison
