Real Estate Blog

Limited housing inventory and rising mortgage rates accelerate September slowdown

Higher mortgage interest rates combined with limited housing inventory in September accelerated the start of the traditional seasonal slowdown in housing markets across the Denver metro and statewide.

Douglas County realtor Cooper Thayer said the market in his area has already settled into winter hibernation.

“With showing volume decreasing quickly into the winter season, the competitive edge in the market has certainly shifted slightly towards buyers, but only those who can stomach mortgage rates above 7%,” he said.

Despite limited inventory, sellers often face reducing prices and providing interest rate buydowns for sellers, according to the September Market Trends Housing Report from the Colorado Association of Realtors.

According to Boulder-area realtor Kelly Moye, 45% of Boulder County’s listings in Boulder County dropped their prices before going under contract last month.

“Sellers are learning how much these changes in rates are truly affecting our buyers and are attempting to adjust to get their home sold,” Moye said in the report.

“Buyers who are waiting on the sidelines are missing an enormous opportunity. They have the chance to negotiate on the sale price and potentially get concessions from the seller to buy down their rate. It’s a chance to get a great deal in this market for the first time in years.”

According to the association’s report, statewide:

  • The number of new listings dropped by 13% from August
  • The number of homes sold decreased by 11% from August
  • The median sale price reduced by .9% to $575,000
  • The percent of list price received dropped by .3% to 98.7%
  • Days on the market increased by 12% to 46 days

The market is stagnant in Jefferson County, said realtor Barb Ecker.

“Not much has changed over the past month as interest rates have once again increased, leaving buyers on the fence. Sellers are not listing their homes because they do not know where they can go and afford a home that they desire,” she said.

Navigating financing has become vital for homebuyers as more demand rate buydowns.

“For the cash buyer who can afford to buy now, the time is prime to take advantage of stagnant pricing. For the financed buyer, it’s beginning to be your time to wheel and deal,” said Denver-area realtor Matthew Leprino.

Aurora-area realtor Sunny Banka called September’s market an early trick-or-treat. The trick is limited inventory as many potential sellers refuse to give up their low interest rates, but the treat is stabilized prices and less competition.

Related Articles

“Buyers are not seeing the incredible bidding wars of the past couple of years,” she said. “They may pay a little more than last year; however, they do not have to buy the spooky, scary house with just one look.”

As long as interest rates stay high, there’s likely to be little change in the market, Banka said.

“I do not expect to see large inventory increases as potential sellers are holding on to their low interest rates just as kids hold on to the good chocolate in their treat bags.”

The news and editorial staffs of The Denver Post had no role in this post’s preparation.

Previous Top of the List: Largest North Carolina General Contractors
Next New apartments in Cary go for $329K per unit as Boston investor makes another $100M deal

Related Posts

Suggested Posts