Plus, read on for a property tax appeal update 🏡💸🏡💸
Just like our toasty summer days, Denver’s real estate market keeps sizzling, refusing to wilt under the pressure of high rates. It’s true that new listing counts have cooled, sliding down around 20% nationally, and Denver’s total listing count has echoed this trend with a 23.2% drop compared to last year. Yet, don’t let those numbers fool you. Denver metro’s average home price has just gently skimmed off a mere .34% compared to this time last year, whispering of what could be one of our shortest housing recessions yet.
Fluctuating interest rates have been the tide’s ripples, influencing the market nearly every week. Buyers, though, have proved to be skilled surfers, catching the low inventory wave quickly. Homes that are ready-to-go and reasonably priced are pulling in full-price offers, typically going under contract within ~14 days or less. This is a market with fantastic prospects for both buyers and sellers – a more balanced playing field than we’ve seen in some time.
High interest rates have separated need-to-move and want-to-move sellers, which has contributed to our lowered listing count. But there’s an interesting swell on the horizon. As inflation decreases, we expect mortgage interest rates to do the same, coaxing buyers back into the game and adding more heat to the already warm market. When rates dip to the low 6% range, I anticipate an uptick in multiple offers and rapidly climbing prices.
Your Secret Map to Home Buying
Looking to buy in Denver but wary of the competition? Let me share a treasure map with you. The zip codes marked in red and orange are more likely to see competition, often leading to multiple offers. Now, if you focus on the areas marked in yellow, green, and blue, you’ll likely have more room for negotiation, making your home-buying journey a more relaxed one.
(courtesy of First American Title/Megan Aller)
Property tax appeals in Colorado have tripled this year, a trend that’s not surprising considering property tax bills are slated to increase by ~50+% next year. If you’ve appealed, hang tight! You should hear back by mid-August. Displeased with your assessor’s final valuation? You still have a chance to appeal with your county board of equalization.
Keep an eye on the ballot this fall. Prop HH is aiming to reduce property taxes. However, it’s worth noting that this proposition also reduces TABOR refunds. Information on Prop HH is gradually making its way into the spotlight, and I’ll make sure to update you as I learn more.
To Rent or To Buy? That is the Question
Despite higher interest rates making buying seem pricier than renting, have you considered the long-term picture? Denver metro’s single-family rental market is robust. Active listings and days on market are down, while rental rates have leaped year-over-year. For instance, the 3.2%-8.54% increase in rental rates over the past year equates to a ~$1,200/year increase in housing costs.
Nationally, a recent study found median monthly rents surged from $817 in 2009 to $1,163 in 2021, marking a 42% gain. Denver’s gain almost doubled this, jumping 82% from $856 a month to $1,554. Denver’s apartment rent inflation has surpassed income gains more than any other major U.S. city since 2009.
Here’s my insight: if your aim is to stabilize your monthly housing costs and build wealth, homeownership is still a feasible goal, no matter your financial situation. I’m here to guide you on your journey so please reach out.