Weekly Market Update, Real Estate Statistics & National News – September 1, 2023

We’ll see you next year! OOMPAH!

Buyers, sellers are happy to have qualified, ready-to-purchase buyers; shopping now will give you less competition and more seller collaboration now than when the pent-up buyer demand inevitably returns to the market.

 

Sellers, buyers are sitting on the sidelines and monitoring the market for terrific properties; in many categories, you can come to market and one of the few interesting-looking houses.

 

73 properties went under contract last week, compared with 87 in 2018, 87 in 2019, 101 in 2020, 129 in 2021, and 90 in 2022. This is a relatively small amount of buyer activity, so buyers take notice that most sellers will be very motivated to interact with you.

 

Total year-to-date purchases show the difference in this year’s market: there have been 2469

year-to-date (YTD) under-contracts (UC). 2018 YTD UC = 2975; 2019 YDT UC = 3089; 2020 YTD UC = 3142; 2021 YTD sales = 3442; 2022 YTD sales = 2733.

 

So, this year our under-contracts are 29% below the market high of 2021, and 10% below the market low of 2022.  Our two non-pandemic years average at 3032 UC per year;  today’s under-contract rate is 19% below the ‘average historic normal’.

 

ACTIVITY BY PRICE BAND

 

The Compass Boulder real estate agents at Burgess Group report that there has been good activity in all price bands over the last month. To note, the big activity in the entry-level market appears to have tapered off, with the advent of school starting. The $2.5mm+ market has had a low sell-through rate through most of the summer, which correlates with increasing inventory.  Luxury buyers have lots to choose from and possibly very motivated sellers to negotiate with.

Comparatively, the Refinance Index experienced a 3 percent increase weekly, yet it still lags behind August 2022 levels by 28 percent. The portion of mortgage activity dedicated to refinancing rose to 30.1 percent of total applications, up from 29.5 percent the previous week. This marked the most substantial share for refinancing since mid-February.

 

Joel Kan, the MBA’s Vice President and Deputy Chief Economist, noted, “Mortgage rates remained relatively stable in the previous week, with the 30-year fixed rate holding at 7.31 percent – the highest since December 2000. Although Treasury yields reached a peak early in the week and subsequently decreased by week’s end, this movement might have prompted some activity.”

Kan continued, “For the first time in five weeks, mortgage applications for both home purchases and refinances experienced an increase, albeit remaining at subdued levels. Despite the rise in purchase applications, they remained 27 percent lower than the previous year. Elevated mortgage rates and a constrained housing inventory persistently influence home buying activity.”

 

Kan further added, “Despite the upturn seen last week, the refinance market continues to languish. The increase was driven primarily by a notable 7.9 percent surge in conventional refinances. However, government refinance applications plummeted by over 10 percent in the same period.”