economy

Supply is in high demand for Real Estate market

Home purchases and mortgage rates to rise in 2014 according to experts

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Housing market experts seem to be in agreement that real estate is booming and healthy in Colorado.

For Jeffco, single family homes averaged 48 days on the market which is a 32 percent decrease from 2012 where single family homes averaged 71 days, according to a market report from the Denver Metro Association of Realtors.

“It’s showing a healthy market, it’s leaning a little bit to the buyer’s side and that’s just a lack of inventory,” Mike Welk, metrolist director of DMAR said.

“That lack of inventory is going to be one of the obstacles consumers will face as demand surpasses supply. New listings are down 35 percent which is drastically under where the county is normally at,” Welk said.

“When we have an increase in price and a decrease on days on market we’re just getting a competitive situation where supply is not there but the demand is very high which is driving the price up and lowering the days on the market,” he said. “We just need more inventory on the market for it to be more of a balanced market.”

Still, buyers are purchasing homes over the asking price and cities like Golden are seeing homes being gobbled up by eager homebuyers. Today, the city of Golden has only six active listings and homes that hit the market can disappear in five days or less but no more than 26 days, according to Golden Real Estate.

In the past there were 20 to 30 listings, said Jim Smith, broker and owner of Golden Real Estate.

“If you’re thinking of selling your home and thinking that buying season is in the spring, forget about it,” Smith said. “That’s what people need to know is there is no season for buying.”

Smith reported that low interest rates on mortgages have contributed to the buying frenzy and why “it’s been such a hot winter for real estate.”

But Smith, along with Welk both predict that mortgage rates will increase as winter turns to spring and the state begins to warm up.

“Mortgage rates will probably continue to increase this year, into the five (percent) maybe,” Welk said.

He projects that demand from buyers will increase and for homeowners who were considered a distressed property, they may see a comeback this year.

“With the median home price going up, if you were underwater the last year or so, you’ll probably come back to being even or having a little equity in your property,” Welk said.

“Now is a good time whether you’re a buyer or a seller to get out there and use a realtor and just ask questions.”