Home sales in the Denver metro area got a boost in early October as mortgage rates dipped, but it was a brief reprieve for house hunters.
The number of closed deals was up 2.4 percent in October compared to September, according to the Denver Metro Association of Realtors. That’s notable because the housing market typically slows down in the fall as people hunker down heading into the holiday season.
The blip was likely due to 30-year mortgage rates falling to the lowest level in almost two years after the Federal Reserve cut interest rates in September, according to Libby Levinson-Katz, the chair of DMAR’s market trends committee. But rates quickly bounced back up above 7 percent.
“The swift rise in rates created a ‘pause’ effect, amplifying the anticipated election-related paralysis among buyers in the latter half of the month,” Levinson-Katz wrote in the report.
A chill has settled over Denver’s housing market during the past year as high mortgage rates make it more expensive to buy a home. The high borrowing costs are making it even harder for many working families and first-time home buyers who were already locked out of the area’s housing market. The median home price is up 24 percent in the past four years.
Homes are sitting on the market longer, giving buyers more leverage to negotiate. Prices are down from the records set during the pandemic-fueled buying frenzy of a couple of years ago. But it’s still hard to find a real bargain. The median price for a single-family home was $650,000 in October.
But for-sale signs are piling up. There were 10,940 active listings at the end of October, compared to 7,482 at the same time last year, according to DMAR data. In 2021, there were just 3,376 homes for sale in late October, the data show.
