Success Stories – Making a Difference

• Mortgage Rates¹ – The market mover this week was the Retail Sales report for September, which rose by 0.7% (beating estimates of 0.3%), pushing rates higher yet again and putting our benchmark rate up to 7.875% (APR 7.916%).  On the inventory side of the house, new home completions, net of homes that need to be replaced each year, were 1.35M.  This is well below the number of new household formations, which are trending at 2M. That kind of supply/demand imbalance will continue to provide support for home values.

• Weekly Market Data² – Active listings continue to climb, and we are now over 7,500, of which 62% have been on the market 30 days or more.  There were 890 new listings, of which only 13% went under contract in the first week.  Closed sales also came in low at 679, pushing our Median Days on Market to 16.  Overall, only 732 homes went under contract last week, most definitely a slow week as buyers sit on the sidelines. (Source REColorado, all DMAR counties, this past week -Thursday to Wednesday).

• Columbine Team Insight – In line with the market we also had a slow week and only had one offer made and accepted.  As is becoming typical of accepted offers the property saw price reductions and the price dropped by over 5% when our buyers made an offer that was accepted.  In addition, our buyers were able to negotiate a healthy seller credit to cover all their closing costs and prepaid items.  We were able to pair this up with a down payment assistance grant of $1,250, and they are quite happy with the situation.

• Market Trends – So much focus these days has been on interest rates that it is easy for some homebuyers have lost sight of the forest for the trees.  Let’s remember that the goal is to find a new home – a place to call your own and (for those of us of a certain age) to raise a family.  Living through years of buyers being at a significant disadvantage due to intense competition, the current environment feels downright friendly.  To help everyone visualize these ‘wins’, we thought we would highlight some of our current happy buyers to illustrate what can be possible. 

1. R&Y loved a home they saw, but it was listed above their budget at $449K on 8/10.  They kept their eye on it and eventually the asking price was lowered to $395K by the beginning of October.  Since it had been sitting, they asked for (and received) an additional $10k in seller credits.  Layer on the fact that they qualified for an affordable mortgage, and the home was eligible for additional pricing incentives because it was conveniently in a CRA zone (Community Reinvestment Act), and they now find themselves thrilled to be moving in next week.

2. K wanted to move to Colorado with a budget of $420k for a single-family home.  She was in tune with her financial picture and kept her eye on the market.  She saw a great opportunity, but it was listed at $450k and had been on the market since early June.  When the asking price finally dropped into her range at $409k, she was ready to pounce.  She presented an offer and was quickly under contract.  She also qualified for a more attractively priced affordable mortgage, and was pleasantly surprised when the home appraised above her purchase price.

3. B&S were ready to buy their next home for their expanding family and walked into an open house in a neighborhood they liked.  With no competition and a price point at $1.2M, they offered $100k under list and met in the middle at $1.15M, a nice $50k off the list price!

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 7.875%, and a P&I payment of $3,480.  The Annual Percentage Rate (APR) is 7.916% with a 0.223% discount fee ($1,070).  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 10/19/2023 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 10/12/2023 to 10/18/2023.   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.