Our market is pretty insane right now. It’s a great time to sell your house if you’ve been thinking about it. Truthfully, this is the best market Denver has ever seen. We have the lowest interest rates and the lowest competition levels we’ve ever seen.
However, there is one thing to be wary of in this market: failed transactions. The number of deals falling out of contract nearly doubled last month. The Denver Post wrote that 23% of all transactions fell out last month.
One problem that’s causing this is how complicated the market is. With record low inventory, most agents don’t have the experience or the expertise to navigate this market. Most agents only close between four and 12 deals per year, so they simply don’t have enough experience to get deals done the right way.
Another big problem for sellers is appraisals. Homes are selling for much higher prices than they are actually appraising for. This isn’t a problem for cash buyers, but it is for the overwhelming majority of buyers who have financing. If a home doesn’t appraise as high as its sale price, the deal is more likely to fall apart if you’re not working with an experienced agent.
Finally, a lot of buyers are having to make offers they aren’t fully comfortable with. They get sick of getting outbid and making a high offer, only to get cold feet after they go under contract. Most of the time, the monthly payment is just more than they are comfortable paying.
This is a difficult market to be in, but it can be a very lucrative market if you have the right help. Having a good agent to keep your deal from falling apart is an invaluable tool in this market. For the record, we didn’t have any deals fall apart last month because we make them every day and we know how to get them done.
If you have any questions or need any help or advice about how to attack this market, give us a call or send us an email. We look forward to hearing from you soon.