Home Prices See Double-Digit Increases

Although housing inventory is sitting on the market longer and the number of homes selling has decreased over the past year in Northern Colorado, the price of homes continues to increase consistently. In September, the price of townhomes/condos increased a whopping 29.7% compared to the same period last year! This is the highest year-over-year increase in the month of September that Northern Colorado has seen in quite some time for attached homes.

As we look at the numbers for single-family homes, we definitely saw an increase in sales price as well, coming in at an almost 14% increase compared to September of 2021. These numbers differ from what we historically experience this time of yearand are the outcome of limited inventory coupled with high demand. The upside? August barely saw an increase across the board for all property types, but September came in with a bang, with prices soaring year over year.

Factors Influencing Home Sales

While days on market have certainly increased for all housing types these past few months, they are still nowhere near what they used to be, even ten years ago. Historically, homes would sit on the market for around 100 days, on average, which equates to just over three months. Now we are looking at 52 days for single-family homes and approximately 90 days for townhomes/condos.

Homes sitting for longer than anticipated is usually attributed to the listing price being too high, lack of buyers in the marketplace, or even high-interest rates. We know interest rates have impacted home sales as they continue to soar to 20-year highs, but they aren't affecting home prices as much as one would think.

The lack of inventory is the other factor that seems to be influencing this crazy market. When there are fewer homes on the market for buyers to choose from, technically, there is more competition. What we have seen, though, in the past few months is a reduction in œover-asking offers, more inspection items being objected to, and fewer offers in total. The number of showings has also reduced dramatically, which again goes back to interest rates these past 4+ months.

Strategy for Buyers & Sellers

In this up-and-down market, what should sellers do to help alleviate some of the pressures of selling in today's market? Well, the first is to have expectations in check. What was once œnormal at the beginning of this year is no longer the case. When discussing your strategy with your trusted Corcoran Perry agent, be sure to discuss what your expectations truly are. If the neighbor's down the street sold for well over asking, is it feasible this will happen in your case as well? Expect your home to actually sit on the market for around a month - these are the numbers we are seeing for single-family homes. Also, keep in mind that showings are way down. If traffic in and out of your home isn't as high as during the pandemic, with a line down the street, that's okay. Remember, it only takes one buyer, and patience seems to be the name of the game these past few months.

So, what should buyers do? Before jumping in your car and heading out to open houses, be sure to have that conversation with your realtor and your lender if you need to acquire a loan. They can help set up a strategy for what has worked in the past as well as what is working today. You probably don't need to go in 10% or 15% over asking, the home you're interested in is most likely priced to sell, so going way over asking or even under may not be the best strategy. It seems almost everyone throughout the home purchasing and selling process these past few months is learning as we go along, so keep the conversation going with your trusted advisors and be sure to adjust your strategy accordingly.