REAL ESTATE NEWS
Mike Shanahan Sells His Mansion!
Local legend, and former Denver Broncos Head Coach, Mike Shanahan and his wife Peggy recently sold their mansion and made headlines. As recently reported by the Wall Street Journal and the local news, the property broke the record for the most expensive single-family deal ever recorded in Metro Denver, at a cool $15.7 million. No big surprise, but the home is in the affluent Cherry Hills Village near Denver. It is 30,000 square feet, features six bedrooms, 13 bathrooms, a wine grotto, a bowling alley, a music room, a poker room, a racquetball court, a golf simulator, a guesthouse, and a 65-foot swimming pool. Interestingly, the massive price tag was the result of several price reductions, and the property was originally listed at $22 million!
How is the Market Performing?
The answer to that question honestly depends on what side of the transaction you are on, and your price point. For home sellers, the past several years have been an idyllic time to sell. Rising housing prices due to a shortage of inventory has led to extreme appreciation over the past year. Home prices in 3Q21 were up a massive 16% from 3Q20, which does not even consider strong price gains from the preceding few years. For historical perspective, price appreciation only averaged 6% from 1971 – 2018.
Some might ask, “Will this trend continue?” With such scarcity in the market and no substantial boost to inventory due to material, labor, and buildable-land shortages, it is expected that price gains will persist for at least the next few years. The net result is that affordability will continue to be an issue, and it will unfortunately price-out many buyers on the lower end of the market.
Info for Buyers
Fall May be a Great Time to Start Your Search
If you are a well-qualified buyer, this fall/winter is typically the best opportunity buyers see all year. The end of the year is historically a slower season for real estate transactions. Although homes are still in high demand this year, the market is still following normal seasonal trends. Since many others are hunkering down for the holiday season, you might get lucky and face less competition in your house hunt. Spring is generally the busiest time for the real estate industry, so if you wait too long to act it is bound to become hyper-competitive as early as January 2022. Plus, as a bonus incentive, many buyers are currently using home purchases as a hedge against recent inflation. As companies are struggling to keep up with demand on consumer goods, prices for everything from a gallon of milk to topping off your gas tank will see price increases, at least into next year. Buying a home and building equity can be a great way to help you build long-term wealth and offset the cost-of-living increases seen around the nation.
Info for Sellers
The Ball is Basically in Your Court
If you are looking to sell your home, this season may or may not be the optimal time to act. It all depends on your financial situation and sense of urgency. If you feel like you must sell due to family, space, job, or other concerns, then you should generally not have a problem getting a deal done. Due to the shortage of inventory, some investors are starved for projects. Many of the homes they would normally buy on the cheap end and renovate to turn a profit have been purchased up by entry-level buyers. Even if your home needs major repairs, the odds are there is usually somebody trying to buy your home if the numbers make sense. Although, depending on what is going on with the property and your neighborhood, you may still have to take a lower offer than you would like.
If you are not in an immediate hurry to move, you might just want to sit on your laurels and hold off for a few more months, or even years. This spring is bound to be the optimal time to maximize your home sale returns, as demand always surges as the new year dawns and the holiday haze wears off. Because home price appreciation is expected to continue for at least the next few years, if not longer, you may even want to sit still and build up more equity before making that move you are dreaming of.