Denver housing market crash? (2013, rentals, mortgages)

[ColoGuy]

Sounds like prices are still going up but quite slowly compared to the more recent boom years.

Preparing to sell my Denver area home next spring I think.

[davebarnes]

The first derivative of the price curve approaching zero is not crash.
A crash is the second derivative going negative. For months.

[BarryK123]

Originally Posted by davebarnes

The first derivative of the price curve approaching zero is not crash.
A crash is the second derivative going negative. For months.

If the first derivative is approaching zero from the positive side, the second derivative is negative. No?

[Mike from back east]

Long article in today's NY Times (for those with a subscription or within the monthly limit) about how housing prices in Denver are outpacing wage increases with the outcome being homes are not selling as fast because people can't afford the level of prices.

Excerpt: "Denver’s once-soaring housing market has run into turbulence. Sales and construction activity have slowed in recent months. Houses that would once have drawn a frenzy of offers are sitting on the market for days or weeks. Selling prices are rising more slowly, and asking prices are being slashed to attract buyers.

Similar slowdowns have hit New York, Seattle and even San Francisco, cities that until recently ranked among the nation’s hottest housing markets. The specifics vary, but economists, real estate agents and home builders say the core issue is the same: Home buyers are reaching a breaking point after years of breakneck price increases that far exceeded income gains."

[Willy702]

Originally Posted by Mike from back east

Long article in today's NY Times (for those with a subscription or within the monthly limit) about how housing prices in Denver are outpacing wage increases with the outcome being homes are not selling as fast because people can't afford the level of prices.

Excerpt: "Denver’s once-soaring housing market has run into turbulence. Sales and construction activity have slowed in recent months. Houses that would once have drawn a frenzy of offers are sitting on the market for days or weeks. Selling prices are rising more slowly, and asking prices are being slashed to attract buyers.

Similar slowdowns have hit New York, Seattle and even San Francisco, cities that until recently ranked among the nation’s hottest housing markets. The specifics vary, but economists, real estate agents and home builders say the core issue is the same: Home buyers are reaching a breaking point after years of breakneck price increases that far exceeded income gains."

Or in other words the market is going back to normal. Last year started looking for a house and it was bleak. Not just the bidding wars, but the fact that you could look at square miles of neighborhoods and see zero listings. It was like sorry you can't even think of living here. Now there is inventory, you can see options. They are still selling but around list or slightly under. A handful are not selling at all but going in them its obvious they are overpriced. Market seems very normal to me today. Who knows how long it stays this way.

[Timmyy]

I am happy that it is finally leveling off a bit. In May the house across the street from me went under contract two days after listing for $20K over listing price. Today there is a house around the corner that was listed about three weeks ago that isn't getting nearly the amount of attention the other house did. There are two possible reasons for this. This time of year is not the biggest buying/selling time of the year and the possible leveling off of the market as a whole.

[sammy87]

I'm in the process of building a new home and will be selling mine in a few months. I watch the market in my area pretty closely (Arvada). According to my agent the market was flooded in August with people trying to sell and move by the start of the school year which caused an stall in the market. Most are doing exactly what I am doing, moving their equity into an upgrade. There are 4 homes near me and 3 are doing the same thing and all have been on the market for about 2 weeks with much lower interest than they would have had 2 months ago. The 4th is moving to CA. I will say that they all have terrible lots and I would never spend $500k to move into them. The other factor is the wait and see approach with the interest rates. Rates will probably go up again next year so they expect to see a flood of buyers again early 2019. Historically this has been a slow time of year to sell anyway. Just starting school and holidays approaching.

Between Arvada and Superior, builders are not slowing down. Commercial and residential is full throttle. The only thing slowing it down is shortages in labor.

[2bindenver]

Take a breath. Seasonally, the real estate market slows in August. It starts back up after Labor Day. It continues until the week before Thanksgiving.

The biggest selling season is from mid March to mid July. If you want to sell to get kids in school, you need to have your property on the market in June.

We might have more inventory at the moment, but it’s not enough to balance the market.

There are price reductions because some property owners have pie in the sky expectations.

[High Altitude]

Even if the market peaks, it doesn’t mean it is going to crash.

The last bubble pop has really distorted people’s beliefs.

[emm74]

I think this is a leveling off in the rise, not a crash and not a seasonal adjustment. And that's ok, the meteoric rate of appreciation wasn't going to last. Even per the article, even with a slower (in comparison) rate of appreciation, prices are still up 8% year over year.

But also a valid point in the article about the impact of interest rates rising. I'm paying 3.125% on a 20 year fixed and don't expect to see those rates again any time soon. I have no plans to move in the near term anyway, but would not want to until I'm ready to sell my current home with a paid off or close to it mortgage, and pay cash for something else.

But I can also sympathize with those priced out of the market. I couldn't afford to buy my own home again, and that was true within a fairly short time of buying it and that was with equity from something I already owned. I'm glad I got into the location I wanted when I was still able to do so.