Once sizzling, Denver’s real estate market is cooling down. But, hey, is that a bad thing?
One local real estate agent thinks not, titling a recent blog: “Why a Normal Market is Just What We Need.” He notes that a normal market, in which prices appreciate less than the 6% we’ve seen recently, is welcome news. “Homeowners looking to sell their home will have buyers, as more buyers will be able to afford them!”
Indeed, most experts agree that getting away from the wild swings of recent years – the terrible lows of 2008; the crazy highs of more recent years—is a welcome change.
They note that a balanced market is the ideal: This is where the number of homes for sale generally equals the number of buyers looking for homes. In most areas, a 6-month inventory of homes is the most desirable.
A recent Keeping Current Matters article notes that, nationally, markets are heading in that direction. Overall, there’s about a 4.5-month inventory. But existing and new construction inventory is increasing, while buyer demand is softening, which should lead toward more balance. Notes Ivy Zelman, an industry expert and author of the ‘Z’ Report, “[O]ur real-time view into the market through our Real Estate Broker Survey does suggest that buyers have grown more discerning of late and a level of ‘pause’ has taken hold in many large housing markets.”
In other words, we are getting back to a slower-paced, more normal market. While this situation may seem odd after years of bidding wars and rocketing home prices, it’s a place that buyers and sellers can both appreciate. Keeping Current Matters likens the situation to driving down the highway over the speed limit and suddenly slowing to a safer speed. “[A]fter going 85 MPH, 60 MPH will feel like you’re crawling. It is the normal speed limit, yet, it will feel strange.”
Photo by Breno Assis on Unsplash