Boulder Sees Seasonal Market Cooling
Here's the latest on what's happening in the Boulder real estate market. Along with the effects of rising interest rates, Boulder is starting to see its typical slowdown as kids get back to school and more attention turns to the upcoming holidays.
In September, new listings remained relatively flat month-over-month as homeowners weigh the pros and cons of selling right now. In the city of Boulder, median single-family home prices dropped from $1,325,000 in August to $1,191,500 last month. Prices are still up 2.9% year-over-year, and the inventory of homes for sale at the end of the month remained low at 2.6 months. A balanced market is six months of inventory, and we are still far from that number.
Across the county, prices also decreased from $830,000 to $799,500 month-over-month. One bright spot is Longmont where home prices jumped from $598,500 in August to $645,155 in September, a year-over-year increase of 18.4%.
In the attached segment, such as condos and townhomes, days on the Boulder market dropped from 85 in August to 60 last month. While that still gave buyers ample time to shop, some likely wanted to get closed and settled before the holidays!
Prices also jumped due to competition amongst buyers looking for budget-friendly housing without sacrificing location. Attached homes in Boulder increased from a median price of $590,000 in August to $610,500 in September.
Countywide, the increase was less pronounced, coming in at $2,500 more than the prior month. And Longmont jumped from $417,500 in August to $472,500 in September.
As the market slows for winter, sellers should expect to be on the market for longer and willing to negotiate on price if needed. With single-family homes now going for 98.1% of the asking price in Boulder and 99.4% countywide, it's always best to work with a pro who will help you navigate a pricing strategy.
Of course, interest rates are still the wild card and they've recently jumped up yet again as the fed continues to fight inflation.
Bottom line? Whether you're buying or selling, a knowledgeable and skilled expert is the best asset a buyer or seller can have. As everyone realigns budgets and expectations, it's crucial to have a well-connected, highly analytical agent who can guide you in making smart decisions.
Today's Real Estate Market Explained
Along with a shifting market, there’s a whole lot of media hype and confusion about what’s actually going on. First, the real estate market is not crashing.
The market is decelerating because the Fed is trying to reduce inflation and slow housing appreciation to a more normal pace. Over the last two years, there has been double-digit home appreciation. The pace of the market was never sustainable and only negatively impacted average buyers and overall affordability.
Even with this current slowing, the National Association of Realtors (NAR) predicts that home values nationwide will still increase by 9.6% in 2023 which is a healthy number. Here's more insight into today's real estate market.
Extreme Seller’s Market Conditions Still Exist
Less than a three months supply of homes for sale indicates a market heavily favoring sellers. The Boulder and Denver areas have around two months of inventory and are not likely to reach a balanced market of six months.
- Buyers can now take time to think before making an offer, but not too much.
- For sellers, the name of the game is to price conservatively and your home will sell.
- Well-priced homes in popular areas are still selling in an average of 2-3 weekends, and bidding wars are still happening. This further indicates a strong market.
Higher Interest Rates or Higher Prices?
It’s understandable that today’s higher interest rates can be concerning. However, this doesn’t necessarily mean that you’ll be paying more. Just six months ago:
- Many buyers could not win bidding wars because the competition was so fierce. On average, homes were going for 25% or more over the asking price.
- Buyers often waived inspections and other protections that left them paying for costly repairs on their homes.
- Some buyers also paid cash for an appraisal gap, while others put down non-refundable earnest money which made it costly to get out of a contract if serious issues came up along the way.
Yes, Smart Buyers Should Buy Now
Within today's post-summer and pre-holiday window, buyers have more homes to choose from and a chance to get a well-priced home, seller concessions, and an actual inspection resolution. The smart move is to take advantage of today's more balanced conditions.
If you're thinking about waiting, here's what's ahead. During the holiday months, homeowners often wait to list—some even pull their active listings off the market, resulting in fewer choices for buyers. And while appreciation has slowed, values and prices will continue to increase each month.
Then in January/February, we'll likely see a seasonal buyer frenzy once everyone has adjusted to the new market and fluctuating rates. The result will be more competition and fewer opportunities for buyers. So, if you'd like to get started, reach out to one of our friendly agents.