With housing prices in Colorado currently at all-time highs, you may be asking yourself, is 2021 a good time to sell your home? While it appears to be a seller’s market, and the perfect time to put your home up for sale, there are many variables to consider before going forward. Below, we’ve outlined important points to know about today’s Denver Metro housing market so you can make an informed decision about selling your home in 2021.
Is it a seller’s market now?
According to Realtor.com, the current supply of homes on the market is at an all-time low, which hasn’t been seen in more than two decades. This can be due to the federal moratorium on foreclosures, as well as the months-long halt on new construction.
At the same time, demand for homes in Denver is up, as many millennials are entering their peak homebuying years, mortgage rates have hit record lows and more people are working from home than ever before. In fact, in 2020, more homes were sold than in any year since 2006, according to data from the National Association of Realtors.
Naturally, when demand exceeds supply, prices will go up. Let’s take a look at some of the current trends driving the Denver Metro market, according to Norada Real Estate Investments.
- Home sales in the Denver Metro Area are up by 20% from a year ago.
- The median home price is $530,000, up 24.4% from last year.
- The average sales price is $673,889, up 34% from last year.
- Homes are on the market for an average of 23 days until sale.
- 104.4% of homes received list price
Clearly, it is a seller’s market in the Denver Metro Area.
Will the market conditions last throughout 2021?
Most experts are doubtful the current seller’s market will remain through the rest of the year. They cite several reasons for this prediction.
First, while demand for homes is currently strong, the rising prices of homes are driving many buyers out of the market, thereby slowly decreasing demand. At the same time, more sellers are putting their homes up for sale to take advantage of favorable market conditions, increasing supply.
Also, with the federal moratorium on foreclosures and evictions planning to end on October 3, 2021, more homes are expected to enter the market.
Finally, mortgage rates have already started to climb upward. According to Bankrate’s most recent survey of the nation’s largest mortgage lenders, as of August 30, the average 30-year fixed mortgage rate has gone up 0.08% from the previous week. All of these factors combine for a likely market cooldown over the next few months, with demand for new homes decreasing as supply increases, until the two are a lot closer than they are now.
If you do want to sell your home this year, it’s best to act as soon as possible to take advantage of favorable market conditions.
Why might it be a bad idea to sell my home now?
Under certain conditions, it may not be in your best interest to sell your home now.
First, a real estate market favoring sellers works both ways. If you are upsizing, you will likely need to pay a lot more for your new home than you would when the market settles down. With moving costs, home repairs and improvements you may need to make when putting your home on the market, and the realtor’s commission, you can end up losing money from the sale, even with the higher price you may get for your old home.
Also, with the demand for new homes currently outpacing supply, you’ll have slim pickings when searching for a new home. You may need to settle for a home that doesn’t meet your wants, or even your needs, simply due to the lack of a better choice.
However, if you’re downsizing or moving to an area that’s not as in-demand as your current neighborhood, this can be a great time to get top dollar for your home and walk away with a nice profit. Before you put your home on the market, though, it’s a good idea to do some research to ensure you can find and easily afford a new place to live.
It’s a seller’s market right now, but that doesn’t mean you should rush to put your house on the market. Research the current market conditions carefully and read the points outlined above so you can make an informed and responsible decision.
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