Today, it finally happened. I’ve been expecting this question about the corona virus effects in the Denver real estate market for a while. And, this question was posed by out-of-town relocation buyers who were planning a house hunting trip in two weeks. they worried that the trip might not be fruitful.
“Will we even be able to get in to see homes for sale on our house hunting trip?”
Yes, they were worried that Sellers might not be allowing showings because of corona-virus fears. In fact, that is just not happening in this Denver real estate market to me or any team members of the Hotz Group. Actually, I have not heard of it from any other brokers.
What Corona Virus Effect on Denver Real Estate?
Why is corona virus not a factor in the housing market? Because, most sellers really want to sell. Most have already make unalterable “life plans” that they either cannot or do not want to change. They have prepared their homes for sale and they are ready to move.
Also, most buyers we see really want to buy. Interest rates are plunging. A 15 year fixed rate loan now is down under 3%. And, 30-year fixed rates may follow soon. Buyers also notice that that more homes are selling. Even in the last 7 days more home have gone Pending Closing than new listings coming onto the market. That’s why home prices typically increase in the Spring. In addition, multiple offers simultaneously are much more frequent. And, more and more homes sell above list price See the chart below.
Megan Aller Explains Denver Market Trends
Our “go-to” market statistician, Megan Eller explains that March is historically the beginning of our extreme Seller’s Market. So far, this year proves no exception. Here is her take on the Denver real estate market.
Volatility and uncertainty continue to rule the psychology of consumers as we close our February and head into spring. While the media continues to churn information out about tension in the Middle East, the presidential election cycle, stock market noise and COVID-19, the Greater Metro Denver Market remains strong and shows signs of being well insulated, if not one of the strongest spring selling seasons we’ve ever experienced.
The price of every product, good or service you purchase is determined by the relationship between supply and demand. Supply for both attached and detached homes remain not only below 2019 levels, but below the average inventory from the last 7 years of our real estate cycle. As unfortunate and depressing as the news can be these days, a positive impact has been revealed by the lowest interest rates we’ve ever seen in history.
This decrease in interest rates hits at a critical point in our 2020 selling season when we typically find the most multiple offers vs. the lowest inventory. Considering our incredibly low inventory fueling appreciation, plus the recent bump in purchasing power for buyers, believe it or not 2020 is better for both sellers and buyers.