Hello, my dear sellers! As your trusty realtor, let’s dive into the exciting world of understanding the real estate market in Denver. Two of the biggest factors that affect the market are inventory and interest rates. Gross I know, but let me explain;

What is inventory in real estate, anyway? It refers to the number of homes for sale in a particular market at a given time. When inventory is low, it means there are fewer homes for buyers to choose from, which can drive up prices and create a seller’s market, resulting in sellers having multiple offers and buyers willing to give more to win the contract. When inventory is high, there are more homes for sale, which can create a buyer’s market and lead to seller’s taking offers below asking or deciding between fewer offers because there are more options for buyers.

Let’s take a look at some examples of how inventory affects the market:

Low inventory leads to bidding wars: In a low inventory market, buyers may find themselves competing for the same properties, which can lead to bidding wars and drive up prices. This is great news for sellers, as they may be able to sell their homes for more than their asking price. I’ve seen days where my niece could have written a for sale sign in crayon and we’ve 37 offers before the sign even went in the ground.

High inventory can mean longer days on market: When there are a lot of homes for sale, buyers have more options to choose from. This can lead to longer days on market for sellers as they wait for the right buyer to come along. Sellers might begin to offer concessions for buying rates down, or helping the buyer with closing costs. Gone are the days when the seller could easily say it’s sold as-is, even though it needs new carpet, new windows, a new roof, and probably new walls too… and get offers $50k over asking. Wild times, man.

Seasonal changes can impact inventory: In Denver, inventory tends to be lower in the winter months, which can create a seller’s market during that time. In the spring and summer, inventory tends to increase as more people put their homes on the market. No one really wants to move in the winter, because the weather is even more unpredictable then, and if you’ve ever tried to haul a couch up a flight of stairs with the snow coming in sideways… 0/10 do not recommend. Plus It’s holiday season, and people are going out town, or hosting family and friends, and adding selling or moving in to the mix is just unnecessary stress that most tend to avoid. Not to mention, having showings when it’s slippery and muddy outside? Those disposable shoe booties can only help so much…

Alternatively, when the weather is nice in the Spring and Summer. People just want to be outside. The yards look the best then, and the idea of entertaining friends and family in your new home with that gorgeous new yard?? Sounds tempting, and you’d be surprised how many people weren’t necessarily looking right then, but they see the potential and get the ball rolling. Plus – Open Houses and touring Model Homes are fun things to do on the weekend if you want to get out of the house or be a nosy neighbor. No judgement, everyone does it.

New construction can impact inventory: The number of new homes being built can impact inventory levels. When there are a lot of new homes being built, inventory levels may increase, which can create a buyer’s market.

Interest rates are an important factor to consider when looking at the housing market in Denver as well. As a seller, it’s important to be aware of how interest rates are trending and how they may impact the market. And as a buyer, it’s important to understand how interest rates can impact your ability to afford a home. Working with a knowledgeable realtor can help you stay informed and make the most of your opportunities in the market.

Lower interest rates can lead to more buyers: When interest rates are low, it can make buying a home more affordable for buyers. This can lead to more competition for homes and potentially drive up prices. However, it can also mean more buyers are able to enter the market, which can be good news for sellers.

Higher interest rates can lead to fewer buyers: When interest rates are high, it can make buying a home more expensive for buyers. This can lead to fewer buyers in the market and potentially drive down prices. However, it can also mean that buyers who are in the market may have more negotiating power.

Interest rates can impact monthly mortgage payments: When interest rates change, it can impact the monthly mortgage payments that buyers need to make. Even a small change in interest rates can lead to a significant difference in monthly payments, which can impact affordability and the ability for buyers to purchase a home.

Interest rates can impact the overall economy: Interest rates can also impact the broader economy, which can have ripple effects on the housing market. For example, if interest rates rise and the economy slows down, it can lead to fewer job opportunities and lower demand for homes, which can impact prices.

Interest rates and inventory are important factors to consider when looking at the housing market in Denver. They aren’t the only factors though, so be sure to follow me for more tips and tricks and info about all things Real Estate and DIY.