IS IT A BUYERS’ MARKET OR SELLERS’ MARKET? YES.
Buyers’ market or sellers’ market?
Yes it is – it just depends on where you are buying or selling.
With national headlines trumpeting terms like “market slowdown” and “housing price correction,” it’s easy to think the buyers are now dictating terms. But the answer to that question is really determined by the conditions in your town, neighborhood, or even a specific house.
For every anecdote that a frustrated seller can’t seem to get a nibble for their property, you can find ample instances of multiple offers on homes that sell above list price. That’s especially true in high-demand neighborhoods in Northern Colorado where supply continues to be tight.
There are unique reasons why the current market has two faces in Northern Colorado.
On one hand, many sellers have yet to accept that the ultra-heated market of late 2021-early 2022 is no longer here, thus allowing them to ask for lofty prices. In fact, higher interest rates have taken the frenzy out of the demand side by reducing the number of eligible buyers.
On the other hand, buyers are seeing the national headlines and assuming they hold all the leverage. In fact, housing inventory in our region remains well below the threshold of a typical buyers’ market. While availability has improved, choices are still at a premium in certain local markets.
The result? A gap in expectations that requires buyer and seller to find common ground – and guidance from a real estate professional to get a fair result for each side.
Call me to schedule your annual real estate review, where we can also talk about if it makes sense for you to be a buyer or seller.
SIGNS THAT SHOW US THAT IT'S BOTH A BUYER'S & SELLER'S MARKET
Advantages to Sellers
New Listings & Months Supply of Inventory are still at historic lows, & price appreciation year over year (while slowing up significantly over the last 120 days, it is still positive).
Advantages to Buyers
Sold Listings & Percent of List Price Received is decreasing, Days on Market & Inventory of Homes for Sale is increasing.
A KEY TO STAYING ON TOP OF A SHIFTING HOUSING MARKET
Whether you’re the buyer or the seller in today’s complicated housing market, the key is not to go it alone. Better yet, seek out a real estate broker with access to up-to-the minute pricing details about your neighborhood, and schooled in the art of buyer-seller negotiations.
For starters, see how your broker stands up to a litmus test of negotiating skills.
For buyers, find out if the broker follows a pre-purchase consultation process to learn about your specific priorities and educate you about local market conditions. For example:
- Can they walk you through the ins and outs of contract writing?
- Are they armed with market details about recent sales results?
- Can they lay out a list of housing options – including new construction homes – that might meet your personal priorities?
- Can the broker bring in a mortgage lender to provide advice about financing?
Similarly, as a seller, find out if the broker adheres to an organized process to best position your property for sale.
- Is the broker prepared to conduct a property “walk-through” interview to learn about your home and the features that make it marketable to would-be buyers?
- Is the broker prepared to conduct a property “walk-through” interview to learn about your home and the features that make it marketable to would-be buyers?
- Is the broker informed about local sales trends and the concept of a “fair market value” of your property?
- Is the broker informed about local sales trends and the concept of a “fair market value” of your property?
A MOVING TARGET: KEEP AN EYE ON MORTGAGE RATES
Pop quiz for homebuyers:
Q: The Federal Reserve raised the short-term federal funds rate on November 2 by three-quarters of a percentage point. In the following days, did the average interest rate on 30-year mortgage go up or down?
A: Down.
In fact, by Thanksgiving Day, the average rate on a 30-year loan had dropped from a high of 7.08 percent on November 2 to 6.58 percent, according to Freddie Mac.
What’s it mean for potential homebuyers? If you have recently been scared off by gloomy headlines about the Federal Reserve’s ongoing interest rate hikes, take comfort in knowing that mortgage rates don’t always follow the leader. Put another way, there can be a disconnect between the Fed and the mortgage market.
In this case, a favorable inflation report on November 10 helped to trigger a downward tend in mortgage rates. And the resulting dip of a half of a percentage point (7.08 to 6.58) is a healthy boost in affordability to buyers – worth 5 percent in buying power to the average borrower.
The lesson? If you’re in the market, align yourself with a REALTOR® and mortgage lender who can stay on top of the volatile swings in rates, and help you be ready to respond to lock in a favorable mortgage rate.
THE GROUP DIFFERENCE
The Group’s inaugural veterans breakfast was held on November 7th, 2022 at the Foundations Church in Loveland. There were 350 people in attendance and we honored 150 veterans during the ceremony. The event was a wonderful opportunity to honor the veterans in attendance with The Group’s first Challenge Coin and pay tribute to our fallen comrades.
Larry Kendall, the co-founder of The Group, was the guest of honor, and was presented with an American Flag, which had flown over the Colorado Capitol building earlier this year on his birthday.
The event was spearheaded by our Managing Broker at the Centerra office, Duan Rockette. As a decorated Marine himself, he said, “It was truly the power of The Group. Our brokers dedicated their time and effort to make the event memorable for everyone in attendance.”
If you or a loved one is a veteran and you’d like to be a part of this event next year, please reach out to me. We’d love to celebrate you.
A LETTER FROM THE PUBLISHER
It was another eventful year in real estate and thank you for placing your trust in us. Our mission is to apply all we have learned to help everyone go from the life they have to the life they dream about.
We also know where we live is truly a special place. We never take that for granted and are willing to do whatever we can to make it even more special. It’s the reason we founded GroupGives in 2013. GroupGives is a fund of the Community Foundation of Northern Colorado and we have given $1M back to the community since its inception.
We are grateful every day for the opportunities we have to serve our community and our customers. Happy holidays from all of us at The Group!
REAL ESTATE BY NUMBERS
- $110 million. Sale price for the 314-unit Trails at Timberline apartment complex, located at 2451 S. Timberline Road in east Fort Collins. Loveland-based developer McWhinney sold the complex to Benedict Canyon Equities.
- 48.5 percent. Share of mortgaged residential properties in the United States that were considered “equity-rich” in the third quarter of 2022. Loan balances for equity-rich homeowners add up to 50 percent or less of their property’s market value. By comparison, just 39.5 percent of homeowners were equity-rich in the third quarter of 2021.
- $24.5 million. Estimated investment by Mississippi-based developer to build an 84-room boutique hotel in downtown Longmont. The proposed Hotel Longmont would be located near the corner of Kimbark Street and Third Avenue.
- $29 million. Price that McWhinney Real Estate Services Inc. paid for the 231-room Fort Collins Marriott hotel, located at 350 E. Horsetooth Road in south Fort Collins.
- $8 million. Price that Colorado Premium Foods paid for a vacant, 172,000-square-foot retail building at 2400 W. 29th St. in central Greeley. The Greeley City Council rezoned the property to allow the owners to convert the site to meat production plant.
- $384,000. The median existing home sales price across the U.S. in September 2022, up 8.4 percent from September 2021, according to the National Association of REALTORS®.
- $12.9 million. Sale price for the 73,170-square-foot Plum Tree Plaza, a four-building industrial complex located on Midpoint Drive in east Fort Collins.
- 512,000. Total square footage for an 11-building industrial complex that was recently acquired by a New York-based investor. Located near the intersection of U.S. Highway 287 and U.S. Highway 36, the complex was sold for $72 million.
- 8.2 percent. Portion of all home sales in the U.S. during the second quarter of 2022 that were “flipped” by owners, or about 115,000 single-family homes and condos, according to ATTOM Data Solutions. It marks the second-highest number of flipped homes ever for a fiscal quarter.
- $73.8 million. Purchase price for Harvest Junction, a 368,000-square-foot shopping center located along Ken Pratt Boulevard in south Longmont. Harvest Junction previously sold for $61 million in 2019.
- 292. Number of apartment units in the Touchstone Apartments complex in Broomfield, which recently sold to North Carolina-based investors for $117.5 million.
- 720. Total number of hotel rooms proposed as part of a larger resort and conference complex planned near the Budweiser Events Center in Loveland. Plans include two hotels, a 70,000-square-foot convention hall, and an 85,000-square-foot indoor water park.
- 150,000. Approximate square footage of a proposed new Costco warehouse store, planned for a 50-acre site along Ken Pratt Boulevard and near the Harvest Junction development in south Longmont. Plans call for the store to open in the spring of 2023.
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