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First, no, the title is not a typo. We have officially entered November, as in the second to last month of 2023. Although I can barely believe this myself, it’s true, and our first snowfall of the season is also behind us, further supporting the time of the year. Now that we have that behind us, let’s talk about what Denver’s real estate market is doing as we near the end of 2023.
Interest rates, although down slightly since their recent highs, are among the highest we’ve seen since well before COVID, with many borrowers seeing rates just below the 8% range. There are more homes seeing price reductions than homes going under contract. Buyers aren’t afraid of terminating a contract due to inspection or other contract contingencies; however, with all of these negative stats, the market has surprisingly stayed relatively positive.
Homes continue to receive offers, and even in some cases, multiple offers are not unheard of (two of TK Homes’ recent listings received at least two offers the first weekend they were on the market). This tells us that even with the high interest rates and upcoming holidays, there is still a demand for homes. However, many homes going under contract are either A) priced aggressively when compared to similar comps that sold just a few months back and/or B) provide buyers with a large seller concession, often used for a rate buydown. Even with homes being priced aggressively or with seller concessions being offered, home values have remained stronger than I would have expected during this time of year.
If you would have asked me two to three months ago how Denver’s market would be holding up as we round the bend and head towards the end of the year, I would have painted a different picture than we are seeing today. This is encouraging because as values continue to hold steady or only trend downward slightly, there is the possibility of ending 2023 with appreciation versus depreciation. I believe that the values holding tight are due in part to many sellers that would normally list their homes deciding to stay put due to their extremely low interest rate. This is causing inventory levels to remain lower, balancing out demand versus supply.
Time will tell how the rest of the year plays out, but today we can be confident that values are holding steady with only slight downward pressure as we get through our annual slowdown to the end of the real estate season this year. As always, check back in next month to see how the market plays out at the end of the year. In the meantime, if you have the need to sell or buy a home in the Denver metro area, we’re here to help. Contact us today!
~ Written by CEO/REALTOR® Trevor Kohlhepp