Home Inventory Increases, Along with Prices
In the city of Boulder, the real estate market continues to be incredibly competitive. There was an inventory bump with 135 new listings to start the month. We also ended April with 100 homes still for sale—an entire month's supply of inventory—and we haven't seen that in a hot minute.
However, the average sales price for a single-family home climbed significantly from $1,717,499 in March to $1,853,544 last month. While that's only a 1.3% increase year-over-year, we're also seeing homes go for 109.4% of their asking price. It seems buyers are presenting their highest and best offer before interest rates climb any further.
By the close of April, 87 listings sold and days on market dipped to 37. The prior month, time on the market averaged 42 days and in April of 2021, it was actually 67 days. Things are moving pretty quickly right now, too.
For buyers feeling priced out, the townhouse/condo market actually became more affordable with the average price now sitting at $590,969. In March, that number was $720,670. While some of these properties are selling for over the asking price, there are well-priced gems available.
Looking at Boulder county as a whole, 455 new listings came on the market in April, a 3.4% increase year-over-year. And the month closed with 285 active listings still available, just shy of the full month of inventory left in the city of Boulder.
Prices for single-family homes also increased from $1,169,889 in March to $1,207,090 in April.
And again, townhomes and condos decreased in average price from $613,876 in March to $565,048 last month. That's up compared to 2021, but still a great opportunity for buyers more focused on location rather than single-family.
What's next for incoming inventory and mortgage rates remains to be seen. However, one hitch we're keeping an eye on is what's known as a "mortgage rate trap."
Over the last several years, especially from 2020 through 2021, historically low interest rates allowed millions of homeowners across the country to refinance their mortgages and lock in rates of 2-4% which reduced their monthly payments by hundreds of dollars in some cases.
Thus, they are in no rush to move or trade up. It could certainly lead to a slowing of incoming inventory before we truly reach a balanced buyer/seller market.
As always, your best bet is to talk with a PorchLight agent who can advise you on when to make your move and how to submit a strong offer that takes into consideration rising rates and your budget. They can also connect you with reputable lenders who can get you the lowest possible rates.
To view our report on Boulder real estate market stats for April, click here.
Tips and Steps for Getting a Home Mortgage
Applying for a mortgage is a major part of the homebuying process. And there's a lot riding on it beyond getting the funds necessary to buy. If you've taken the right steps, you'll secure the best possible mortgage rate—incredibly important considering percentages are on the rise.
And by having all your financial ducks in a row, you'll make a better impression on sellers when submitting an offer and get to the closing table without delay. Then you can simply sit back and enjoy relaxing on the back patio with mountain views that you've been dreaming about.
Here are the seven steps—you can also talk to your real estate agent for further guidance or help finding a mortgage lender that's easy to work with and there to assist you through the process.
- Check and Repair Your Own Credit: It's no secret that a higher credit score is vital to locking in the best rates. So, get your free annual report and address anything suspicious or inconsistent. See what debts you can knock out quickly and make a plan to continue reducing your debt.
- Lower Your Debt-to-Income Ratio (DTI): Typically, lenders want a mortgage and home costs to be no more than 28% of your gross income. Once everything is calculated, your DTI should be no more than 36%. With fewer debt payments, you’ll have greater buying power.
- Get Pre-Approved by Your Lender: Submitting an offer with your loan amount pre-approved is a must in today's market. For this step, a lender will look closely at your finances and require documentation regarding your credit, income and debts.
- Look Beyond Home Price: Even if you're pre-approved for a certain amount, keep other costs in mind such as property taxes, homeowners insurance, HOA dues or condo fees. As a buyer, you'll also need to provide earnest money, as well as pay for an appraisal and home inspection.
- House Hunt with a Real Estate Agent: Pay nothing out of pocket while having an experienced guide to help you choose a home, submit a strong offer, negotiate terms, as well as tap into their resources and connections to get you to the finish line faster than doing it on your own.
- Gather Your Financial Documentation: Your lender’s underwriter can only move as fast as you can provide your information. So, have records ready for bank accounts, tax returns, car loans, credit cards, any other debts, plus assets such as investments, other properties and your 401k.
- Don’t Make Changes to Your Job or Finances: Even after you're “clear to close,” a lender will continue to track your finances and credit score until the day of closing. Don't make major purchases, take out credit cards or change jobs. Maintain the status quo until all paperwork is signed.