2019 could be a very Happy New Year for both buyers and sellers in the Denver real estate market. The challenge will be determining when during the year to buy or sell a home.
They say you can’t time the stock market. I have found that to be true. But, I can also tell you from personal experience that timing is everything in the 2019 Denver real estate market. I expect that timing will be essential this year due to some of the changes that we’re seeing on a national level.
Denver Real Estate Sellers
The 2019 Denver Real Estate Market most likely will be seasonal again. Sellers will have the happiest new year likely during March April and May. That’s when home sales skyrocket in the Denver market traditionally. So, many of my sellers are waiting until then to put their homes on the market. Expect another surge of available homes for sale beginning in February and continuing through the summer.
The last six months of 2018 showed signs of increasing inventories of homes for sale. This increase in supply caused some minor depreciation of sold home prices. But, considering the dramatic increase, homes in many neighborhoods remain stable.
Lower Mortgage Interest Rates
I would expect home buyers will benefit more from any decreases in mortgage interest rates than home prices.
The rising interest rate environment which slowed the Denver real estate market in the last half of 2018 has already improved. Rates are lower now than they were just six or three months ago on expectation that the Federal Reserve Board will pause interest rate hikes. And, rates are likely to hold well below 5% through at least the first half of 2019. After that, it all depends on whether the Federal Reserve Board resumes rate hikes.
Lower interest rates will decrease the cost of monthly mortgage payments for Denver home buyers in early 2019. Waiting much beyond that could cost home buyers extra dollars every month.
More Denver Homes For Sale
In addition, inventories of existing homes for sale are likely to continue to improve for buyers in the 2019 Denver real estate market. During the last three years, buyers had to choose from the lowest number of homes for sale in modern recorded history. But, the last six months showed the inventory of existing homes for sale increasing.
So, buyers will have more homes to choose from during at least the first few months of 2019. And, if seasonal fluctuations continue as they have in the past, the last few months of 2019 will also offer a better selection of homes for sale.
Even if the available supply of homes for sale doubles again this year, sellers have shown that they have the ability to wait it out. That’s partially due to the fact that most sellers already have very low-interest rates. In most cases, those interest rates are lower than what they will have to pay for a new mortgage.
So, seller motivation has been lacking. And, barring a recession or increased unemployment in Denver, seller motivation is not likely to improve significantly during 2019.
Happy New Year
So, buyers have a unique opportunity to make a happy new year. Just by early while interest rates are lower and before the Federal Reserve Board resumes their increase in interest rates that ultimately affect mortgages. And, the happiest home sellers in 2019 will be those who list their home for sale in February, March, and April.
Happy New Year to everyone in 2019!