As inventory continues to grow tighter and tighter, and with lower interest rates, the 2021 buying season is off to a wild start. With a lack of homes hitting the market, this past January and February have been an adjustment for everyone.
Historically speaking, the winter months always tend to have low levels of inventory. With snow, frozen ground, and dead flowers, homes don’t shine the same as they do in the spring months. With interest rates hitting historic lows, it has brought more buyers to the market earlier than in the past, creating a perfect storm. More buyers and fewer homes result in the massive over asking offers, unlimited apprisal gaps, and the tough competition to snag a home.
If the competition feels overwhelming, I have some advice…wait it out! What I have been seeing in the market is homes going at least 10% over the list price, with unlimited appraisal gaps, and limited inspection verbiage. The winning offers all have these terms. An appraisal gap seems to be one of the most important factors that sellers consider when selecting an offer. Your price is only as good as the gap that you back it up with. I have been counseling my buyers the same way, if you can wait, I would.
As springtime creeps closer and closer, inventory will continue (hopefully) to grow. Last week we saw the most amount of homes hit the market in months, a good sign for buyers! Sending the much-needed relief that we all are looking for. March tends to be the kickoff to the buying season here in Denver. We see the most amount of inventory, have the most amount of sales, and closed transactions. If you can hold yourself back just a couple more weeks, there should be more homes to see and hopefully fewer offers on the houses, giving buyers a slightly better chance of locking down the dream home!