Real Estate Buying Stops

Where have all the home buyers gone? This question may be true in many real estate markets. But my experience is specifically in Denver and it is a question. I heard while working in the Denver real estate market. Statistics from the Denver MLS corroborate this sentiment. Eevealing that Denver’s home inventory is up 6 percent. While Denver’s home sales are down 6 percent since May. What is causing this phenomenon? And when will the demand return so Denver sellers can sell their homes and move on before school starts?

This is our opinion. The home tax credit sparked pent-up demand from Denver home buyers, who finally had a reason to step out. For their comfort zone of doing nothing and buying a home. After three years of a sluggish housing market. The tax credits finally incentivized Denver buyers enough to buy a home. And there was even a deadline attached to this free money. This frenzy made Denver home buyers realize that investing in real estate is not a bad idea. And considering historically low mortgage rates. You may be able to buy a home for a cheaper monthly payment than rent. The “free money” created a huge increase in purchases. There were listing agents selling houses in just a few weeks. The market went a bit crazy over a period of two to three weeks.

What is the obvious effect of this huge acceleration in purchases? You get a lag at the other end. Think of it like a waterski rope that takes a big tug from acceleration, but then you have to be careful not to fall over while you wait for the boat to catch up with you again. Buyers are still out there, but the market is feeling the delay from April’s huge shopping spike. get a cash offer here.

good news for Denver home buyers

The good news for Denver home buyers is that the best deals and bundles and interest rates came after the tax credit. This carries even more and more weight now, as rates have dropped even further. Denver homebuyers now have nearly $ 50,000 in additional purchasing power before the tax credit expires, due to these lower mortgage interest rates. This will help keep Denver home prices stable and return demand to the market.

The biggest remaining hurdle is how to get new home buyers to believe that buying Denver real estate is a good investment. Many young professionals with stable jobs continue to rent. Why? Because they have read the terrible headlines and are comfortable with their tenant lifestyle. They have few friends who have bought a home in the last five years, excited about the great investment they made. When you ask these overqualified tenants why they don’t own a home, they respond, “I don’t want the responsibility of owning a home. I like my life.” It’s hard to argue with them, but I can see changes on the horizon.

In fact, Denver’s average 12 percent drop in home prices was much less than in certain areas of the metropolitan area, such as Glendale, where certain Denver condo and apartment prices fell 33 percent between 2005 and 2010. A Often these bigger drops in real estate Real estate prices were found in newer properties and buildings, whose facilities and locations are just as great now, but whose prices are much more reasonable.

Of course, for home buyers who bought Denver real estate between 2000 and 2007, this means that the price of their Denver property is likely to be lower than when they first bought it. For these owners, there is a silver lining. For starters, rental rates are steadily increasing and vacancy rates are near a 10-year low (02), so there aren’t many other options that are better than your home. Additionally, foreclosure rates are falling (03) and the state’s population continues to rise at double-digit rates, meaning that the demand for Denver real estate should return.

Excessive leverage of credit through risky mortgages was seen as a symptom of faulty. Housing and tax policies. And some are promoting renting, not buying, as a safer and safer way to ensure financial stability (1). But the logic behind this new reasoning is now flawed, especially in the Front Range, where Denver’s real estate conditions have greatly improved.

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