Denver Market Update
Denver Market Update
Real Estate News – February 2025
Is there an interest rate tipping point?
- We are closing 3,000-5,000 homes a month, which hasn’t changed much in over 20 YEARS.
- With the population growth we’ve experienced during that time, it appears there is growing pent-up demand. Massive apartment complexes have been built all over town. Many of those renters will want to buy soon.
- The higher interest rates have kept sellers in place much longer than they would normally have been. They’re holding tight, not wanting to sell their 3% mortgage to buy a 6-7% mortgage.
- As rates start to decrease, possibly lower again in September, I believe there will be a “tipping point” when this demand comes to the forefront and the market is on fire again. Buyers not wanting to be renters anymore and Sellers deciding “it’s time!”.
- What is that tipping point? What’s the magic interest rate? That’s the billion dollar question.
Several national insurance companies are getting out of Colorado completely or simply not writing any new business for homeowners insurance. Between the wildfires and the hail storms, insurance companies are losing billions of dollars and leaving the state.
BE CAREFUL
Most insurance companies are updating their renewal policies with a 2% deductible. This means that if your home is insured for $600,000 (insured value, not market value), your deductible for any home claim will be $12,000. The days of $1,000 – $5,000 deductibles on your home insurance are gone. Please check your policy. If you still have a low deductible, it WILL change at some point soon.
If you need an alternative insurance company, please call my insurance agent.
He is a broker with 22+ years of experience and has access to multiple companies.
Kevin Schneider (no relation)
Secure American Insurance
303-807-3100
kschneider@secureamins.com
Kevin is an expert and will make sure that you have the proper coverage on your home, not just the cheapest premium.
- The average sales price was up 1% for homes and down 5% for condos.
- The average price for a home in the Denver Metro Area (not including Boulder) is ~$780,000.
- Inventory is up significantly for both homes and especially condos. Buyers finally have less competition to worry about.
- Average days on market from listing to under contract was 46.
- Interest rates are ~6.875% nationally.
2025 Real Estate Outlook
- I anticipate a relatively flat year for home prices (<+5%).
- Buyers are in the market and ready to buy. Activity has already increased.
- Sellers will struggle with losing their 3% mortgage but many will move anyway because it’s time, due to other factors (size, layout, area, schools, etc).
Interest rates will likely never make it back to the 3-4% range in my lifetime. Waiting for that will likely cost you hundreds of thousands of dollars of equity gain. Don’t wait!
Real Estate Advice
Keeping in mind that there is NO bubble and NO sign of any kind of real estate crash, which of these describes your situation?
If you are a first-time buyer:
Buy ASAP and refinance when you can.
The number of buyers will grow much faster than the number of sellers when rates drop, leading to significant competition.
Trade-up Buyer with Average to Nice House:
Sell and buy now, for the same reasons above.
Make sure your home is in great showing condition.
Trade-up Buyer with Below Average House:
Avoid fussy buyers and list your home when the market is hot (generally March to June-ish).
Owner Occupant Seller, Leaving Denver:
Focus on the hottest time in the market and make sure your home is in great showing condition to maximize traffic and offers.
We’re here to answer any questions you might have, so don’t hesitate to reach out!
If you’re thinking about a new construction home, be sure and reach out to us so you will have proper representation. The sales office represents the builder, not you, and it costs you NOTHING for us to represent you.
Questions? Comments? Contact us anytime. We’re here to help.
Thank you!
Testimonials
“Working with Drew and his team was a very positive experience. In fact, they were so good, I will always turn to them as my real estate professionals! I was a bit nervous about their knowledge of my area when we started the process as they aren’t located directly in Castle Rock, however, Drew said they knew the area and I trust Drew. As it turned out, they really knew the area! The neighborhood research provided was accurate and the sale price they suggested was exactly on target. Our house so… Read more
“We are so grateful that Drew was referred to us. We found him to be responsive, knowledgeable, and patient. He kept in constant contact with us during our search. Most importantly, once we made an offer he and his staff were so very helpful in each of the steps leading up to and including the closing. We would highly recommend Drew Schneider.”