Metrolist data for June shows Denver experienced a 9.5% drop in listed inventory during the past 12 months. (June of 2008 had 27,295 properties listed as compared to 30,145 units in June of 2007.) Another excellent change is that last month the Denver market had 8,382 units under contract; a 13% increase over June of 2008. This is the highest number of under contract properties in Denver for June since 2003.
These changes are fantastic news for the Denver Real Estate Market. It means we are starting to see improvement and are heading toward a more balanced market; which is very healthy for both the buyers and sellers.
When the market swings too far either direction, it is not good for either buyers or sellers. Since most sellers typically turn around and buy another home, it is most advantageous when they can relatively easily sell their present home. If, like during the past couple of years, many sellers have not been able to sell their present home, they can not buy another. So, the entire market becomes plugged up and home values drop along with market confidence. Lenders then also become more conservative in their lending practices and make it more difficult for buyers to qualify. Appraisers begin to under value homes in hopes of not being behind the market in their evaluations. These low appraisals actually force the market even lower. The downward spiral keeps accelerating to the point that the market is under valued; like it is in many areas of Denver today.
A healthy and balanced market exists when buyers and sellers are actually freely able to sell and buy when they want to. Although our market never stays exactly balanced, the closer to balanced we are, the healthier our market becomes. Homes then continue to experience normal and healthy appreciation. Buyers, sellers, lenders and appraisers all have confidence in the housing market. The market moves freely and uninhibited from artificial forces. Everyone wins when we have a balanced market.
Feel free to call or write with your comments on this topic. If you are considering buying a home, now is one of the best time to do so that we have seen for the past several years. Interest rates are still holding around 6.0% and available inventory remains high.
These changes are fantastic news for the Denver Real Estate Market. It means we are starting to see improvement and are heading toward a more balanced market; which is very healthy for both the buyers and sellers.
When the market swings too far either direction, it is not good for either buyers or sellers. Since most sellers typically turn around and buy another home, it is most advantageous when they can relatively easily sell their present home. If, like during the past couple of years, many sellers have not been able to sell their present home, they can not buy another. So, the entire market becomes plugged up and home values drop along with market confidence. Lenders then also become more conservative in their lending practices and make it more difficult for buyers to qualify. Appraisers begin to under value homes in hopes of not being behind the market in their evaluations. These low appraisals actually force the market even lower. The downward spiral keeps accelerating to the point that the market is under valued; like it is in many areas of Denver today.
A healthy and balanced market exists when buyers and sellers are actually freely able to sell and buy when they want to. Although our market never stays exactly balanced, the closer to balanced we are, the healthier our market becomes. Homes then continue to experience normal and healthy appreciation. Buyers, sellers, lenders and appraisers all have confidence in the housing market. The market moves freely and uninhibited from artificial forces. Everyone wins when we have a balanced market.
Feel free to call or write with your comments on this topic. If you are considering buying a home, now is one of the best time to do so that we have seen for the past several years. Interest rates are still holding around 6.0% and available inventory remains high.
2 comments:
How much is your home worth? Well, it all depends where you live.
The real estate market is still shaking. New data suggests that home prices have hit a new record low. In every new study that comes out, homeowners from Miami, to Las Vegas, Phoenix and Los Angeles, have seen their home value go lower every time.
Is that disappointing? Of course it is.
Should we sell? Is not a good time.
Should we stick to it? Yes, if you can.
Have we hit bottom? Nobody knows.
Banks are facing their worst foreclosure crisis.
Don’t take me wrong, it’s good if you are in the market to buy a home for yourself or if you are an investor, but if you are not, and you own a home, most likely the value of your property is down at least 15 %.
Why do banks care if you are loosing your home? By having to sell repossessed homes, banks have to literally slash their prices down. It gets very costly for them, after all, they have to pay property taxes, maintenance costs, and whatever utilities that need to be paid, all of this expenses for a house that it’s just sitting there, vacant, and the bank is getting nothing in return.
The latest study by the S&P/Case-Shiller Home Price Index of 20 cities, revealed the news that for 22 consecutive months home prices dropped. Only from April to May, 2009 the decline was of 0.9 %
Hi there,
You might be interested to know that all the bad news about mortgage companies and the melt down of the mortgage industry is not really affecting as many home owners nation wide as the public thinks. There is an interesting CNBC news viedo that shows only 2% of the nations home owners have been affected by the mortage industry problems. You can view it at:
http://www.cnbc.com/id/15840232?video=780461999
Best wishes,
Bill Kosena
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