Your Castle Real Estate

Your Castle Logo
CONTACT US
(303) 962-4272
Buy Property | Sell Property | Search
  • Home
  • Our Team
    • Find an Agent
  • About Us
    • About Your Castle
    • Staff
    • Offices
    • Cities
    • Alliance Partners
  • Relocation
  • Services
    • Buyer’s Guide – Denver Homes For Sale
    • Sellers’ Guide- Your Castle Denver Realtor
    • Denver Real Estate Investing
  • Media
    • Newsletter/Blog
    • Your Castle Gives – Residential Real Estate
  • Training
    • Upcoming Courses
    • Past Courses
  • Contact
  • Careers
    GO

    MARCH/APRIL NEWSLETTER 2021

    March 16, 2021 By Lon Welsh Leave a Comment

    interest rates on the rise

    interest rates on the rise

    REAL ESTATE NEWS

    A REBOUND IN CONFIDENCE, BUT INVENTORY LAGS BEHIND

    The “dark winter” is winding down, and spring is growing on the horizon. As we make another lap around the sun, some things are considerably different from last spring. For one, consumer confidence has come a long way since the turbulent shutdown last year. Three FDA-approved vaccines are being administered for emergency use. Many at-risk citizens, hospital workers, and government employees have received one or two doses. Congress also approved a third wave of stimulus checks for many people. They will be sent out this month across the country, further soothing some of the financial burdens from the ongoing pandemic. On the other hand, housing inventory is still lagging in seven counties that make up the Denver metro area and interest rates continue to climb.

    The average number of listings in February is historically 13,500. At the end of February 2021, there were only 2,025 active listings, a record low (includes attached & detached homes).  This February was down 58% in inventory from the same time last year. The simple fact is, we need to reach a critical mass of people getting vaccinated for some sellers to feel safe opening up their homes to strangers. We do not expect this to happen until sometime this summer.

    interest rates on the rise

    INFORMATION FOR BUYERS

    Interest Rates Are on The Rise

    The average 30-year fixed mortgage rate recently increased to the 3% mark for the first time since last July. This may discourage some buyers, potentially lessening a bit of the competition in the market. But it is important to keep in mind that 3% is still historically very low. In Feb. 2020 before the pandemic hit, the rates were already considered historically low at 3.5%. In comparison, rates were at 4.5% in Feb. 2019, and 6% in Feb. 2008 at the start of the last recession. These increased rates mean that a homeowner would owe more money in interest over time. However, they would also be gaining equity at a faster rate, as appreciation in Metro Denver is up to nearly 20% from this time last year.

    Many homes still sell at, or near, market value

    One recent trend in the media has been to focus on the most extreme cases of homes selling for more money than their list price, further frustrating buyers. They have highlighted homes that have had over 100 showings in the first weekend and 20 offers, telling people that they need to be prepared to offer 20% above the asking price on homes. Although this is a competitive market and that is true of select homes, it is certainly not the norm. In February, on average, homes sold for a 1.9% premium (See the February Market Snapshot Graphic.) For a $350K home, this would amount to $6,650 over the asking price. Still a dramatic reflection of low housing inventory, but not as dire as a 20% markup. Many homes still sell at, or near, market value.

    Many buyers are getting frustrated over getting outbid on brand new listings. One helpful strategy to combat this could be to focus on homes that have been sitting on the market longer than one weekend. These homes may be perceived as defective by buyers. However, in many cases, they were just priced too high by overzealous sellers. After being passed over for being overpriced, or having passed on decent offers, these sellers may sign lower offers than they had initially hoped to accept.

    INFORMATION FOR SELLERS

    A Strong Seller’s Market Continues As interest rates continue to climb

    Interest rates on the rise

    The 30-year fixed mortgage rate has slowly been on the rise since the year began, as it appears that it bottomed out at the end of last year. As these interest rates continue to climb past 3%, some marginal buyers will pull out of their home searches. This will gradually reduce the buyer pool. In addition, it is all but guaranteed that as more people are vaccinated and comfortable with people in their homes, many first-time sellers will list their homes to try and capitalize on the current seller’s market. Over the course of the year, this should increase the available inventory. Although showing traffic is still incredibly high and it is expected to remain a seller’s market for quite some time, in Denver, it will most likely reduce some of the current fervor in the market.

    As a prospective seller, especially in the $1MM+ price band, act now to get the most out of your home sale. 63% more homes over $1MM were sold in Feb. ’21 than in Feb. ’20. Sellers are cashing in on low-interest rates before it is too late. Another point of note is that if your new listing is under $800K and you are not getting 20 showings in the first week, odds are your home is overpriced. Although the market is in your favor, you should expect that if you get 10-20 showings the first weekend, one offer, and that offer is an at-or-near asking price, that is normal. Do not lose out on a sure thing because you are reaching for some fabled 20% above asking price sale. Throughout the process, remember the reasons you are selling your home and celebrate that closing!

    interest rates on the rise

     

    Filed Under: Real Estate

    Leave a Reply Cancel reply

    Your email address will not be published. Required fields are marked *

    Recent Posts

    • What NOT to Do After You are Approved
    • 4 Ways to Network as a New Real Estate Agent
    • The Ultimate Colorado Bucket List
    • What Is the Strongest Tailwind to Today’s Recovering Economy?
    • MARCH/APRIL NEWSLETTER 2021
    • 5 Tips for Making a Successful Offer
    • 3 Kinds of Content to Post on Instagram
    • Why You Need a Real Estate Agent
    • Love Me or Not: Home Equity Loans
    • 10 Signs You’re Ready to Buy
    • How to Manage Your Time Successfully
    • FEBRUARY / MARCH 2021 NEWSLETTER
    • 5 DIY Home Improvement Projects
    • 6 Things Your Website Needs for Realtors in 2021
    • Why You Should Get Preapproved This Year
    • 6 Best Instagram Marketing Tips for 2021 Mortgage Style
    Your Castle Real Estate - 2755 S. Locust St. Suite 150 Denver, CO 80222
    Agent Login
    YourCastle.com uses cookies to customize your experience. Learn about cookies and our Privacy Policy here.

    Information source: Information and Real Estate Services, LLC. Provided for limited non-commercial use only under IRES Rules. © Copyright IRES.
    Information is provided exclusively for consumers' personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing. Information deemed reliable but not guaranteed by the MLS.

    Copyright © 2021 Pueblo Association of Realtors. All rights reserved. The data relating to real estate for sale on this web site comes in part from the Internet Data Exchange Program of Pueblo Association of Realtors. Real estate listings held by IDX Brokerage firms other than Your Castle Real Estate are marked with the Internet Data Exchange logo or the Internet Data Exchange thumbnail logo and detailed information about them includes the name of the listing Brokers. Information provided is deemed reliable but not guaranteed.

    The content relating to real estate for sale in this Web site comes in part from the Internet Data eXchange (IDX) program of METROLIST, INC., DBA RECOLORADO © Real estate listings held by brokers other than Your Castle Real Estate are marked with the IDX Logo. This information is being provided for the consumer's personal, non-commercial use and may not be used for any other purpose. All information subject to change and should be independently verified. See Disclaimer

    The real estate listing information and related content displayed on this site is provided exclusively for consumers' personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing.
    This information and related content is deemed reliable but is not guaranteed accurate by the Pikes Peak REALTOR® Services Corp.

    Property listing data provided by Summit County multiple listing service. Information last updated: 12th April, 2021 14:00 MST. All information provided is deemed reliable but is not guaranteed and should be independently verified. The advertisements herein are merely indications to bid and are not offers to sell which may be accepted. All properties are subject to prior sale or withdrawal. The sale offering is made subject to errors, omissions, change of price, prior sale or withdrawal without notice.

    Listing Data last updated: 12th April, 2021 14:00 MST
    Service by Buying Buddy IDX CRM
    Equal Housing
    Blue Fire Group    Real Estate Websites
    © 2021 Copyright
    Your Castle Real Estate
    LAC
    My Buying Buddy    Powered By MyBuyingBuddy ®