The price of homes in Colorado is spiking again and interest rates seem to be staying high. However, as the market has slowed down there’s a wider selection for those looking to buy.
The housing market constantly changes, and some Coloradans are being forced to move away from cities in order to afford to buy homes.
That’s the case for some of Eduardo Dominguez's clients. He’s a Thornton-based real estate agent with Colorado Casas Realty.
“Houses are definitely staying more on the market in the northern cities —Longmont, Johnstown, all the way up to Fort Collins,” he said.
Home prices in Weld and Larimer counties tend to range from just below $500,000 to nearly $600,000. In comparison, a Colorado Association of Realtors report showed the average price of a single family home in Denver was about $668,000 in April.
Interest rates for a 30-year mortgage loan are still high, averaging between 6% and 7%. They are predicted to remain that way through the rest of the year. Dominguez said a normal interest rate is around 5%, but he hasn't seen that yet in 2023. An excellent interest rate would be considered 2% to 3%.
People often choose to buy in Northern Colorado communities because they can find bigger lots and acreage. Plus, the housing market competition is usually not as fierce.
Although prices have been bumping up, people are still buying and selling, Dominguez said.
“People still want to achieve their home ownership, and some are selling because they have gained equity,” he said.
Last year, people were frequently bidding over the asking prices of homes, creating steep competition in the market.
“A lot of people were really discouraged in buying a home, or in the possibility of buying a home, because they didn't have the $50,000 to $70,000 that people were bringing [in] cash to close,” Dominguez said.
A lot of his clients feel relief now that the market is settling down again. At the moment, the supply and demand for houses is relatively balanced.
Dominguez said there are plenty of homeownership options out there because it's a slower market right now. But if the market gets hot again, there may not be enough inventory to go around.
Kenya Garcia, another real estate agent working with Dominguez, said the last time they saw a significant lack of inventory was in 2021.
“Interest rates were so low that everyone was trying to buy a house,” she said.
Garcia also said some people avoid buying because they are not informed about the housing market and believe what they hear from other people. They might hear warnings about high interest rates or might not know if they could qualify for a home loan. She said it’s important to talk to a professional and get educated.
Some say buying a home is becoming more expensive than renting, but Garcia insists that in the long run there are more opportunities for those who own property.
“If you buy a home, you're investing. If you rent, well, you won't see that money again,” she said.
Dominguez is working to offer educational classes about the real estate market and homeownership. He said education is key.
"There's just so much about the real estate market people don't realize: that they can qualify for a home, that homeownership is possible for them," he said. "There's a lot of loopholes and a lot of tricks that we have, and we can definitely help [by] educating people."
