As the year comes to an end, I’m sure many of us are ready to flip our calendars to 2021. Despite all the challenges 2020 brought, we’ve seen a strong real estate market, capable of thriving even in the midst of a pandemic and tumultuous election year. And, Colorado in particular has been a hot spot for those relocating from other states, fueling even more appreciation in home prices. So, what will the market bring in 2021? Let’s start with inventory. One of the driving forces in Colorado’s market activity is the extremely low level of housing inventory. In fact, in several areas inventory is the lowest on record. From Colorado Springs to Fort Collins, we’ve seen a steadily decreasing number of homes for sale, which has naturally resulted in an escalation of bidding wars, higher sales prices, and less days to sell. It seems that this trend will continue into the new year, as a lack of land and high building costs make it difficult to create new inventory. A correlating factor is demand - homes are selling so quickly that inventory has no chance to keep up. Record low interest rates are enticing buyers, and Colorado continues to be a desirable place to live. The pandemic has made people more aware of what they want in a home, or where they want to live now that millions work remotely. Many Colorado cities are top living destinations that offer a unique lifestyle, from world-class outdoor activities to urban life. Everything points to strong demand continuing into next year.
January may be the new spring... In years past, we typically see the same seasonal trends in terms of market activity. Spring is a hot time for real estate, especially in Colorado, as the weather warms up and people list their homes for sale, drawing more buyers into the market. However, we’ve seen this ‘spring trend’ occur earlier in the year, and this year especially as the market conditions heading into 2021 are extraordinary. Interest rates are still near record lows, inventory is way down, but buyer demand is very high. The interest rates in particular are extremely attractive, and won’t last forever. If you’re a seller, chances are you’ll sell your home quickly and for top dollar as buyer demand is so strong. If you’re a buyer, while prices may be higher in some areas, chances are you’ll actually still save in the long run due to the low interest rates.
If you’re on the fence one way or the other, feel free to reach out and I’d be happy to answer any questions you may have.
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