If you’re considering a home purchase in Colorado this year, it’s likely you’re paying close attention to the local housing market. With varied information channels like the news, social media, your real estate agent, and discussions with friends, you’re gathering a lot of insights. Topics like home prices and mortgage rates are probably frequent in these conversations.
Here are the top two questions to ponder as you navigate the Colorado real estate landscape, including the data that helps cut through the noise.
Where Do I Think Home Prices Are Heading?
One reliable place you can turn to for information on home price forecasts is the Home Price Expectations Survey from Fannie Mae – a survey of over one hundred economists, real estate experts, and investment and market strategists. According to the most recent release, the experts are projecting home prices will continue to rise at least through 2028:
This information is crucial, especially in the context of Colorado's market. Even if the rate of price appreciation isn't as steep as in recent years, the general consensus points to rising prices. For potential buyers in Colorado, this means that purchasing sooner could lead to a gain in home equity over the coming years, as prices are more likely to increase than decrease.
What's the Outlook for Mortgage Rates?
The past year saw a spike in mortgage rates due to various economic factors. However, there are signs of positive change, particularly relevant for the Colorado market. With inflation beginning to stabilize, mortgage rates have started to respond by decreasing.
The Federal Reserve's indication of halting their rate hikes and potentially reducing rates in 2024 adds to this positive outlook. Such developments are likely to impact Colorado's housing market as well.
Danielle Hale, Chief Economist at Realtor.com, explains:
". . . mortgage rates will continue to ease in 2024 as inflation improves and Fed rate cuts get closer. . . . a key factor in starting to provide affordability relief to homebuyers.”
Similarly, the National Association of Realtors (NAR) observes:
"Mortgage rates likely have peaked and are now falling from their recent high. . . . This likely will improve housing affordability and encourage more home buyers to enter the market . . .”
While no one can predict mortgage rates with complete certainty, the current trends and Federal Reserve's decisions indicate a positive turn for potential buyers. While some fluctuations are expected, the general direction points towards improved affordability as rates continue to stabilize.
Bottom Line
For those considering buying a home in Colorado, it's vital to stay informed about the broader trends in home prices and mortgage rates. While specific predictions are challenging, having access to the latest data can support a more informed decision-making process.
Let's connect to ensure you're up to date with the latest developments in the Colorado real estate market and understand how they may benefit you.
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