Interest Rates on the Rise

Interest Rates on the Rise

Denver Real Estate Market Snapshot - March 2018

Median home prices are still on the rise and it appears interest rates are starting to follow. In early February we started to see an abrupt increase in 30-year fixed interest rates. The Fed indicated there will likely be three rate hikes this year and they are starting to make good on their promise.

INTEREST RATES

Interest rates are slowly but surely making their way back up to 2013 rates. One thing to note are the peaks and valleys that happened in 2013. We will be anxiously watching for any repeated trends over the next 12 months. If rates do ease, I would expect to see a small surge in purchases for those trying to time interest rate movements. That wouldn’t be a welcome addition to the buyer demand we are currently seeing.

30-Year Fixed Rate Mortgages 2013-2018

Coming in hot at 4.4%, the current interest rate is at it’s highest since February 2014. This is a 0.24% increase from the interest rate in March 2017 (4.20%). That equates to an increase in the interest payment per month of 23 bucks per $100k borrowed.

30-Year Fixed Rate Mortgages Previous 12 Months - March 2018

But don’t worry, this is still incredibly low, especially when you compare it to the rates that the Baby Boomers bought their homes for — over 16%!

30-Year Fixed Rate Mortgages 1972-2018

AVERAGE DAYS ON MARKET

Average days on market is the same as it was this time last year. In Denver County, homes are currently on the market for an average of 26 days. In December it was 37, which is an indicator of a seasonal slowdown. But now, things are starting to pick up and we desperately need inventory. Good homes are being snatched up quickly and over list price. Like $40k over list price!

Average Days on Market | Denver County | March 2018

Comparing “apples to apples” the average days on market are tracking  the same or slightly downward for most counties, the exception being Broomfield.

Average Days on Market | Denver Metro Area | March 2018

 

INVENTORY

1.2 months of housing inventory. That’s what we currently have in Denver County. Just a reminder: 6 months of inventory is what our market needs to even out and we haven’t seen that much inventory in years.

Average Housing Inventory Denver Metro Counties March 2018

The amount of homes on the market have decreased by -0.7% since this time last year. In Denver County, 1,311 homes were listed and 1,109 homes sold this March. In March 2017, 1,482 homes were listed and 1,117 sold. It’s not that big of a difference but we need all the homes we can get!

Average Number of Homes for Sale in Denver County 2007-2018

MEDIAN PRICE RANGE

March saw the median sale price for all residential properties (attached + detached) in Denver hold steady at $425k from the previous month. Attached properties were hitting the median at $375k and detached at $471k .

Median Home Prices Denver County 2007-2018

This time last year, the median price range for detached and attached properties was $393k. That is a $32k increase from last year, a 8.1% appreciation rate. This is proof that Denver homes are continually increasing in value at an above normal appreciation rate.

Median Home Prices Denver Metro Counties March 2018

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