· Mortgage Rates1 – There was very little economic news this week with initial jobless claims coming in at 231,000 and US Treasury auctions seeing ‘as expected’ demand. Consequently, rates have remained relatively flat and our benchmark rate edged down slightly to 6.990% (7.023% APR).
· Weekly Market Data2 – Active listings are quickly closing in on the 7,500 level, with another solid showing of new listings (1,525) and 1,132 goung under contract. Median Days on Market hit 7 days, indicating that half of all closings this past week had gone under contract within 7 days of hitting the market. (Source REColorado, all DMAR counties, this past week – Thursday to Wednesday).
· Columbine Team Insight – We saw a substantial number of offers go out this past week, of which 60% were accepted at an average of 1.4% over the list price. Most offers met with competition and of the 8 accepted offers none of them were below the list price, 3 were at list and the other 5 were above list. Homes listed between $350k – $750k saw the most competition.
· Market Trends – It is that time of year when the pendulum begins to swing from sellers offering concessions to sellers demanding appraisal gap coverage. If you find yourself offering above the list price in order to be competitive with your offer, then you will be faced with the decision of whether to also offer to cover the Appraisal Gap. By covering the gap, you are typically agreeing not to go back to the seller and ask for a price reduction if the appraisal comes in between your accepted offer price and the list price. Since the lender will use the appraised value when calculating loan ratios, it is good to understand if you can simply allow the loan to restructure – meaning you have still met the minimum down payment requirements with the new assessed value – or if you would actually need to bring in additional funds. Understanding these dynamics before you submit your offer can help put you in a position to compete with confidence.
NOTES:
(1) The mortgage loan scenario presented assumes the purchase of a primary residence, excellent credit, an 80% loan-to-value (LTV), a loan amount of $480,000, a 30-year fixed interest rate of 6.990%, and a P&I payment of $3,190. The Annual Percentage Rate (APR) is 7.023%, which reflects a discount fee of 0.094% ($451). Monthly principal and interest payments, which will continue for the stated term until paid in full, do not include mortgage insurance, property taxes or homeowners’ insurance premiums and actual monthly payments may be higher. Interest rates are current as of 05/09/2024 and are subject to change at any time without notice. All loans are subject to credit approval. Other terms and conditions may apply. Not all loans or products are available in all states. Regulated by the Colorado Department of Regulatory Agencies, Division of Real Estate.
(2) Source: REColorado®, Inc for the period 05/02/2024 to 05/08/2024. Data for Adams, Arapahoe, Boulder, Broomfield, Clear Creek, Denver, Douglas, Elbert, Gilpin, Jefferson, and Park counties. This representation is based in whole or in part on content supplied by REColorado®, Inc. and REColorado®, Inc. does not guarantee nor is it in any way responsible for its accuracy. Content maintained by REColorado®, Inc. may not reflect all real estate activity in the market.
Recent Comments