Market Update, August 17, 2023

Thirty-year fixed mortgage rates tied a 20-year high today, reaching an average of 7.37% nationwide.

If you’re going to buy a home, we recommend you talk to multiple lenders. Apply with up to three lenders at the same time. That way, your credit score won’t suffer. If you spread applications over a long period, your score may decrease. Different lenders charge different fees, and you may get a better rate at one lender versus another. 

Consider asking for the seller to help buy down your rate. Many sellers are offering concessions that can bring your rate down for a limited period, like one, two, or three years. 

You can also buy down your rate from the lender and pay a lower interest rate for the life of your loan. This is often called “buying mortgage points.” You’ll pay more upfront but could save money down the road. This makes the most sense if you believe rates will stay the same or increase over time. If they go down, you could refinance and avoid costs associated with buying points.

Hire an agent who is a tough negotiator and can help you get the price and terms you need on the home you want. Buyers who are more active in the market know how to work to get their clients the best price and terms.

Finally, buyers should consider lowering the price they’re willing to pay for a home. 

The median home in Metro Denver costs about $590,000. Buyers who put 10% down could pay $4,250.12 each month. Before the pandemic, in February 2020, the monthly payment for the median-priced home then was approximately $2,107.39. At that time, the median home price was $430,000 and the typical 30-year fixed rate was about 3.5%.

In other words, the monthly payment on the median-priced home in metro Denver has doubled in three and a half years.

If you’re a seller with a home on the market now, you should understand that your home gets more expensive every time rates rise.  

Despite high monthly payments, if you want to move now, you can do it. Inventory continues to rise, which gives buyers more choices. Consider homes that have been on the market for over thirty days, where sellers may be willing to make a deal. 

Ready to make your next move?

Contact David and Tom at The Principal Team for expert guidance before buying or selling. Call 720-782-2468 or schedule a time for us to call you.

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During the last week:
New Listings – 1337
Back On Market – 318
Price Increase – 90
Price Decrease – 1523
Pending – 1323
Withdrawn – 164
Closed – 1064
Expired – 194

Previous Week:
New Listings – 1476
Back On Market – 320
Price Increase – 111
Price Decrease – 1611
Pending – 1324
Withdrawn – 173
Closed – 1082
Expired – 216

Based on data from REColorado®

“We enjoyed our first-time home buying experience with David! And we are so grateful for the Front Range Heroes program that he graciously offers to teachers and other public servants. We found a wonderful home and are very happy with the result. David was available at all hours of the day to help us with whatever we needed. Highly recommend working with him.”
– Jabez M., Wheat Ridge

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