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Monica’s Monthly Minute- Denver Real Estate Market Update

If you are new to my monthly minute, WELCOME!
My goal with this newsletter is to provide you timely updates on the Denver Metro Real Estate Market that are applicable to you and your real estate interests. If you have any questions or feedback, please don’t hesitate to send me a message.
I look forward to hearing from you. – Monica
September 2020 Video
When will the foreclosures hit the market?
Check it out HERE
Real Estate News
As summer fades into fall, the presidential election is on the horizon. In an already surreal year plagued by a pandemic, social disruptions, and a plethora of divisive issues, many people are wondering how the upcoming election will affect home sales. It has been reported that the average home price in Denver has increased to over $600,000 this spring. What will happen now?
As stated in some of my other market updates, the average price in the news was misleading. Because the inventory of homes from $0-$500K was so low due to Coronavirus fears and a pre-existing housing shortage, the “average” price was skewed towards higher-priced listings. It was not so much that home values skyrocketed through the recession as reported. Rather, the mix of what was available shifted upwards in price. Homes from $500K-$900K drove the recovery in Denver. The market was stalled in April and May but since then some of the listings that did not previously come on the market were eventually sold which has aligned us back to the normal seasonal trends. People have seized on the opportunity to trade up to larger homes for the same monthly payment with such low-interest rates. It is expected that in the spring of 2021, an even greater number of homes will be brought to the market that were not listed this year.
During non-election years, the number of homes sold typically drops about 10% in the six weeks prior to November. Prices are not typically impacted. This is the normal seasonality. In election years, the number of sales drops an additional 5% for the six weeks leading up to the election. This is election-year seasonality. Most likely, the media will not know how to reconcile this sudden drop in home sales with the inflated price averages from this spring. It will probably be reported as some shadowy force that signals impending doom for the real estate market. Do not believe the hype. Seasonal trends still affect our industry, regardless of who wins an election. In fact, based on historical data, which political party gains control does not change these stats from election-year to election-year.
Depending on your circumstances, if you act fast you may see a bit of luck in the next month or so. The election will most likely slow some people down on their home searches while they wait to see the outcome. On average, the number of homes sold could drop by as much as 15% nationwide. That, coupled with historically low-interest rates, could help you get a sweet deal that has eluded many in the more competitive summer months. In the six weeks after the election, home sales should swing upwards again based on historical trends. Interest rates could increase by at least half a percent — as they do after nearly every presidential election. If it is in the cards for you financially to act fast, know that these low rates will not last forever. If now is not the right time for you, Spring should bring more inventory for you to choose from. It is difficult, if not foolish, to try to time the market. Ultimately, remember to act in your best interest, move when the timing is right for you and be patient once you do start searching for a home.
It has been a seller’s market for years, and there is nothing to signal that will change any time soon in Denver. Depending on your situation, you may want to consider jumping in now before the winter sets in and the market cools off. Interest rates nearly always go up by at least half a percentage point after any presidential election, so if you act fast you may lock in a better rate on your next home.
On the other hand, perhaps you want to hold off on selling until after the presidential election when home sales are expected to increase again after the pre-election dip. Some sellers may even wait until spring when the market gets red hot and more buyers are expected to start shopping. No matter which way you spin it, sellers are still in the driver’s seat in terms of negotiations. Inventory is low and demand is high in the Denver Metro Area, which leads to more positive outcomes for sellers. Please give me a call and we can chat through your options and discover what timing works the best for you.
I can’t say enough good things about Monica. She is professional, upbeat and knows the local market. We were looking for a starter home/investment for our daughter and decided to work with Monica. In just two days we had a contract on the perfect home in Northwest Denver. Unlike most real estate stories, this one was a flawless experience from start to close. We’ll never use another real estate agent again.
  • Chad, Denver, CO

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