Q & A: We want to buy, but wondering if the market might go down in the fall/winter?

I'm in the early stages of working with some new buyers. They have been pre-approved, and are living in a rental. They could get out of their lease early if they want. They recently asked me the following:

Question:

"We are wanting to buy, but I think we are waiting/hoping the market might go down in the fall/winter. Do you have any insight on that? We’re getting antsy to get out of renting, but don’t want to buy before the market might take a hit from COVID."

Answer:

If you’re hoping for big price reductions, you’ll be waiting a long time. Maybe forever.  It’s all about supply and demand. Here in Colorado, we’ve been in a pretty “hot” seller’s market for the last 5-7 years. Lots of people are moving here for jobs, the economy, the weed industry, etc.  That has caused the supply to go way down and demand go up. As a result, prices are increasing. With all of the new construction going on (more inventory) it’s helping out the supply issue…but that’s more in the $500K+ price points.

The market is still pretty hot – especially at lower price points. Anything under $400K is super hot and won’t likely change for a long time. If ever. We would need a huge number of homeowners flooding the market with listings. The reason why we have such low inventory  is because sellers don’t want to sell because there isn’t much to buy! 

Regarding COVID and the economy, it’s possible that we could see a wave of foreclosures for those people who have lost jobs. BUT I think it’s doubtful…since the market is so strong here. Foreclosures are pretty rare. Usually those sellers who are in trouble can sell their home pretty quickly and avoid foreclosure. Only time will tell.

I always tell people that you shouldn’t try to “time the market”.  You should buy / sell when the time is right for you and your circumstances.  Right now, it’s a great time to buy  because rates are at crazy record lows  -- like under 3%!   I have been very successful in getting buyers into homes in lower price points. It’s all about having the right agent and the right strategy. It may take a few tries, but we WILL get you into a new home! 

The only thing that might happen this fall/winter is that there will likely be LESS inventory.  And…remember the part about supply and demand? The greater the demand and/or less inventory = higher the prices.

The good news about waiting until Fall/Winter is that you may also have fewer buyers house hunting. Less competition, but you'll also likely have fewer options.

Hope this helps!

Sally Grenier
Broker Owner
Grenier Real Estate
303.475.4508 cell
sally@sallygrenier.com