Across the state of Colorado, housing inventory is currently low. This means less options, and often, a more competitive marketplace. In Denver metro, inventory of active listings peaked at 7,942 in September 2016, and decreased drastically by 52%, to 4,063 active listings, in January 2017. In Boulder, the number of active listings reached 243 in August 2016 and decreased 30%, to 171 active listings, in January 2017. In the Vail Valley, active listings in July 2016, reached 987 and decreased 33%, to 658 active listings, in January 2017. In the Summit County, inventory peaked at 1,089 active listings in August 2016, and dropped 49%, to 558 active listings in January 2017. In short, lower inventory often drives real estate prices up, meaning it is best financially to list your home when inventory prices are low. While low inventory can be discouraging, opportunities for both buyers and sellers are possible with a bit of advanced planning and by being connected with an expert in the marketplace.
Who’s Driving the Market?
The inventory shortages throughout the most desirable areas of Colorado are driven by hungry buyers who are trying to locate a home within a reasonable price range, making putting in an offer challenging. Inventory shortages in the Colorado housing market have driven up the prices on available homes, a factor which sometimes hinders sellers from listing out of fear they will have nowhere to move, thus causing more of the median sale prices for single family homes to actually rise when listed for sale. The hyper-competitive environment is caused by the supply-driven market where new development and construction of new homes has lagged as Colorado’s population has grown- although recently, there is an uptick in both population growth and new construction.
Know Where to Look
By weighing a variety of factors including the number of days on market a property has been listed, and analyzing recent agreements and closings of properties within the desired areas of your search, it is possible to negotiate the best offer to make your desired purchase a reality.
According to Realtor.com, Colorado’s inventory shortage of homes has also been caused by an influx in international investment capital, low interest rates, restrictive zoning regulation and a strong core in the business sectors that have expanded high-end development while constraining amount of growth of median-price housing markets. The increased costs of construction and new development to keep up with the need for more housing are passed onto the consumers in way of higher asking price for such properties.
Weigh Your Options
Having expert knowledge available to you about which areas throughout Colorado offer the best deals, can help determine how much home you might actually be able to acquire. The long-term investment strategy for emerging neighborhoods should be considered in the rapid transformation of Colorado’s market with future development plans underway in the next decade.
According to data from Zillow, the high cost of real estate reflects that $300K-$750K buyers may struggle more with affording to buy properties within the major metropolises of Colorado. The rising home prices and cost of living in many Colorado cities and towns is already above the national average. Buyers are better armed with accurate information to make buying decisions when considering an investment range based on one’s personal financial situation, pre-approved loan or assets and long-term goals.
Strength in Numbers
Those seeking to find a home immediately within the metro Denver or Boulder may face disappointment if they start the process on their own. The demand for real estate by people looking to live in the city has already proven to greatly exceed the supply available currently in 2017. Furthermore, those wanting to make a bid on a new property have no choice but to move quickly with their offer. Recent trends have shown that newly listed properties that are optimally priced only spend short time, with an average span of only a minimal number of days, on the market. These listings are also confronted with multiple offers, with some even over-bidding to get the deal done.
LIV Sotheby’s International Realty has experienced agents who can assist homebuyers with determining a competitive offer in the Colorado or resort-area markets. In varying markets, buyers may not be aware of real estate options in comparable areas, and could be at risk of putting in daring offers that cause higher long term debt. For that reason, taking the time to discuss all your available options with a real estate professional at LIV Sotheby’s International Realty should be your top priority before you begin any transaction.