What are the signs of switching to a buyer’s market?
Are we beginning to switch to a buyer’s market in the Denver Foothills? Any market of any kind that deals in a product from stocks to homes needs to find its value. There are many variables that control the value of any product. No matter how big or small. People will only pay over the perceived value for a short time. That time is a knee jerk reaction that they feel they missed something. They will overpay and drive prices up as long as there are more buyers than sellers. That is what we are still seeing through the winter here in the Denver Foothills. We still have very low inventory at the moment. We still have a great deal of buyers but they seem to be fading fast. I personally track a lot of data points that I have found to truly reflect the trend of buyers. It doesn’t tell me the amount but it does show if we have more or less than a given period in time. I can tell you we certainly have less buyers this winter than last and a lot less than the summer.
What that means is with less buyers the sale prices will not continue to rise at the pace they have in the past. They most likely won’t go down but they will not appreciate at the pace they have the last couple years. We are seeing more people not wanting to pay the price for homes that frankly even in my eyes aren’t necessarily worth what they are asking. There was a time people were testing the market and actually getting the price or close to it. We aren’t seeing that anymore. Buyers are not having the knee jerk-must have attitude. They are walking away when sellers are being unreasonable. Granted if the real estate broker for the listing prices the home right they are still selling quickly. We are seeing homes under $400,000 move pretty fast. That is if they are in decent shape. Some of the ones that are way over priced even under $400,000 are not moving like they used to.
We will most likely begin to see more buyers come around with the spring thaw. That should also bring us more listings as well. This should help us return to a more balanced market. Believe it or not a more balanced market is better for everyone. Especially since in the Denver Foothills and Evergreen a good deal of the home sales are people up sizing or downsizing but staying in the same area. That movement has all but stopped in the last few years because sellers were afraid they couldn’t find another home in time for closing or at all.
So to answer the question, are we moving into a buyer’s market? The answer is not yet but the pieces are in place to make it happen sooner than later. A balanced market is good for everyone. It makes it so no bubbles are formed and buyers are confident the values will stay steady. If you would like to discuss the current real estate market in the area contact Orson Hill Realty.