for the month of October 2018
Everyone in Colorado knows to expect sudden weather shifts, particularly come October! Cool in the morning, you’ll most likely ditch that jacket by afternoon – or the exact opposite, with a few snow flurries thrown in for good measure. If you’ve been following the state of this current marketplace it may very well have you feeling the same way as the weather.
Is the market slowdown that’s happening actually part of a trend of moving away from what, until now, has been predominantly a seller’s market? Are we in fact shifting into a buyer’s market? Could this slowdown be nothing more than the usual we see around this time of year and nothing to get overly excited about?
Our prediction that the pendulum would begin swinging toward a more balanced marketplace as we move into year-end sales certainly is making an appearance. The combination of home prices stabilizing after having been on the rise for a while, the expected slower market after the start of the school year, recent mortgage interest rate increases, and a surge in new home construction are all contributing factors.
We may not be able to accurately pinpoint the exact reason, but the facts presented indicate the market is moving more slowly. Those high sales numbers we’ve been seeing in spite of continued low inventory levels are definitely beginning to trend downward.
Although at this time it doesn’t look likely to be swinging into a true buyer’s market, it is certainly trending toward a more balanced market. That market also appears to be more favorable toward buyers price-wise than in the recent past.
Even though high demand is driven, in part, by the stronger economy and job market here in Colorado, it also reflects the fact that, though conditions have changed, in most of our markets home price and mortgage rate increases haven't pushed past the point of affordability.
Comparing housing affordability today to the average affordability prior to 2003, for instance, we are in excellent shape in our housing markets across the Front Range.
Yes, the available inventory still hovers closer to 2-4 months rather than the 6 months of a truly balanced market. But with these shifts in the overall market, perhaps more home sellers will be ready to enter the marketplace, which will substantially increase available resale home inventory come the new year.
When you're shopping for a house to buy, affordability is a huge concern, and rightly so. After all, even in a buyer's market, house hunters have an interest in getting the best deal.
Was the average sale price of $352,020 in the Aurora marketplace the best deal this past September? 589 buyers who closed on their new homes certainly seemed to think so! With average Days on Market at just 24, an increase over September 2017’s at 17, the available inventory of 837 homes didn’t seem to present much of an obstacle to eager buyers.
Higher inventory levels, helped by the 4% increase in issued building permits, will continue to naturally lead to a slowdown in price increases, which should encourage continued growth in buyer activity. This is a very good sign for a lasting healthy economy even with the shifts that we see occurring in the marketplace.