95% of Denver homeowners are facing this challenge
ResiClub (a leading nationwide media source focused on the residential housing market) just released a fascinating report in partnership with Zillow to continue exploring the ongoing impact of the Golden Handcuffs or “lock-in” effect many homeowners like you are facing.
Denver is one of the cities most affected by the nationwide interest rate swing that occurred during 2022.
As financial author Morgan Housel says “Things that have never happened before happen all the time."
This rapid rate swing was one of those things. Just our luck.
95% of Denver homeowners are facing this challenge
According to the report, even though roughly 27% of Denver homeowners are mortgage-free, only 5% of Denver home owners are both mortgage-free AND in a financial position to comfortably afford a new mortgage at today’s market rate. The other 95% are considered “locked in.”
Here are the most locked in major housing markets nationwide.
Contrast this with more affordable cities like Pittsburgh, Buffalo, or Cleveland where almost HALF of homeowners are reportedly mortgage free and 20+% are in a financial position to take on a new mortgage.
What does this mean?
It means that, unless something that has never happened before happens, we’re likely facing a long slow crawl out of this locked-in market.
The spring market has been surprisingly strong, but with rates climbing by roughly .5% in the past week, we might start to see a slow down as buyers and sellers respond more sensitively to rate fluctuation than historical seasonality trends.
Regardless of interest rates, thousands of homeowners will continue to sell because of…
1) Death
2) Divorce
3) Diapers (growing family)
4) Distress
5) Deployment (job transfer)
6) Diamonds
7) Downsizing
In fact, my most recent three buyers are each buying (or already bought) homes from sellers facing one of these exact situations.
There are ALWAYS homeowners who need to sell.
There are AWAYS buyers wanting to buy.
It’s all about knowing how to best navigate the current market to achieve the best potential outcome for you.
If you have a desire to buy or sell in the coming year, let’s chat.
Life has a way of keeping us all moving, and I’d love to be your real estate agent.
Contact me here to set up your free and confidential consultation.
Kevin