Metro Denver Real Estate Market Update, December 1, 2022

We hope you had a fantastic Thanksgiving! In the spirit of Thanksgiving, we’d like to focus on some of the good news in the real estate market. We always want to be realistic, of course, and part of that is to look at what’s right in the housing market and economy in general.

First, mortgage interest rates dropped today. Nationally, the average rate is down to 6.29% for a 30-year fixed mortgage. Rates have fallen for about three weeks in a row, and predictions are that rates may drop even further soon.

Higher incomes are helping Americans blunt the effects of inflation. For example, the mortgage debt-to-income ratio is at historic lows. In addition, other debt is not out of control, with overall debt-to-income ratios staying relatively low.

Most experts are not forecasting a wave of foreclosures, even with a slower labor market and inflation. Mortgage delinquency rates have remained below 4% since the first quarter of 2017. Last quarter, they were below 2%. To put that in perspective, mortgage delinquencies were above 10% in 2010 and 2011.

In Metro Denver, there were 7% more homes for sale this November compared to last November. That gives buyers more to choose from.

Construction spending dipped a bit in October but is up compared to previous years. That’s good news because the entire country is seriously short of housing. Fortunately, lumber prices have been falling since January. 

Buyers looking to purchase new construction homes are in a great position – 70% of builders said in mid-November that they were offering special incentives to buyers so buyers wouldn’t cancel contracts.

While some headlines make it seem like the sky is falling, real estate is highly personal. Whether it’s a great time to make a move depends primarily on your needs and goals, your stage of life, your career and financial situation, and much more.