For the third straight week, housing inventory in Metro Denver has moved higher. Active listings finished the week at 13,326, which is a net gain of 45 homes compared to the week before. While the weekly increase only pencils out to a 0.34 percent bump, the longer-term picture shows inventory is still up 20.8 percent compared to last year. That said, the pace of annual growth has been slowing as the market tries to find its balance. New listings continue to outpace pending sales, and that is the primary driver of this recent upward movement.
The bigger story this week is mortgage rates. Even as the Fed cut rates, mortgage rates moved higher. The average top tier 30-year fixed closed the week at 6.37 percent, up from 6.22 percent the week prior. FHA loans followed the same path, finishing at 6.05 percent. Rising Treasury bond yields pushed mortgage rates higher, as investors continue to hedge against inflation and other risks.
Seller concessions remain a very real part of today’s market. This week, 64.6 percent of sellers paid some type of concession to buyers, up from 60.2 percent last week. One year ago, that number was 62.9 percent. A big question moving forward is whether buyers will continue to lean on rate buy-down concessions once rates stabilize or move lower.
Meanwhile, the Fed is still front and center. CME Fed Watch places the odds at over 94 percent that the Fed will cut the federal funds rate by another quarter point in October. Markets clearly expect further easing.
Mortgage applications ticked up slightly, rising 0.6 percent from the previous week. Refinances were the standout, increasing 1 percent from the prior week and now sitting 42 percent higher than the same time last year. Homeowners are watching closely for any rate dips and taking advantage of the opportunities when they can. Purchase activity, on the other hand, continues to grind forward but remains slower compared to the last few years.
The bottom line: inventory is inching higher, rates are stuck in a tug of war between Fed policy and bond yields, and concessions are still shaping how deals come together. Denver’s market is moving, but buyers and sellers both remain cautious.
The MLS data reported herein is pulled on Wednesday of each week. Days in MLS (DIM) is defined as the cumulative number of days a home remains in the MLS with an Active status. Data may not reflect all housing activity in the area. Rates quoted in this report are not an offer to provide mortgage services. Researched and authored by Steve Danyliw. Source of data: REColorado.com, Danyliw & Associates, Mortgage Bankers Association & MortgageNewsDaily.com
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