REAL ESTATE NEWS
PENT UP DEMAND LEADS TO A FAST RECOVERY
Denver metro residents formerly considering a move in the spring have brushed off the cobwebs and rushed back into the daylight post-Coronavirus shutdown. As if they heard a starting gun, people looking to move in March and April have returned to the market in full force. Recent trends data shows a strong V-shaped recovery since showing restrictions have eased. Property showings and under contract listings have even recovered to levels above this time last year. The number of closings should soon follow, as listings generally take three to four weeks to finalize once under contract. Based on the current data, the spring selling season has just shifted a few months forward into the summer, albeit a slightly weaker one than in recent years.
The Safer-at-Home Order has been extended until at least July 1st. But this sudden influx of real estate traffic is a strong sign of the continued strength of the local real estate market (although many of us could do without the traffic on the roads!) The local government has indicated that property showings can continue if real estate professionals adhere to strict safety measures. Some of these include wearing masks and gloves during showings, not carpooling to properties, and disinfecting homes in between each showing.
Looking to buy in the current market? One positive note is that interest rates are still at historic lows. If you lock in a low rate on your purchase it goes a long way towards the long-term affordability of your investment. The Fed plans to keep rates low as long as they feel the economy needs propping up. Given the spike in unemployment during the pandemic (making a positive recovery in recent news) and the heavy blows to industries like hospitality and tourism, that will most likely not happen anytime soon.
When shopping for a home in the Denver metro today, your odds at success could depend heavily on your budget – and your patience level. In the lower price points (0-$500K) you can expect continued competition and multiple buyer situations, e.g., bidding wars. However, if you can stick it out through multiple rounds of offers there are still great homes out there. If you are a trade-up buyer looking to move to a larger home, this could be a golden opportunity. The large inventory of higher-priced homes coupled with the strong demand for lower-priced homes makes for a perfect chance to trade-up.
The pandemic affected all of us, but it did not change one thing; this is still a strong seller’s market. Despite all the virus-related pandemonium, low housing inventory continues to keep home prices high. The pandemic did however further slow new home construction. Although construction was still considered an essential service during the shutdown, builders and investors slowed way down on new home starts. What does this mean for you? This is a still great time to sell a home in the Denver metro. As long as housing inventory stays low and demand remains high, you can expect to do well in most selling situations. Be sure to talk with your agent to price your home correctly from the onset, as that is a major factor in selling your home quickly and for the most money.
At Your Castle, we pride ourselves on our local market research. We recently updated our Gross Rent Multiplier Maps, called GRM Maps. This data shows which neighborhoods are the most appealing for investors. The lower the GRM, the better cashflow for your rental property (usually.) We pulled rent estimates for Denver metro neighborhoods for 1, 2, 3 and 4 bedroom properties and created a map for each. These maps show the typical rent range for the neighborhood. To pull the raw data we used Rentometer, which is a great rental comparison tool. Curious to learn more? Reach out to me today!