Dave’s Market Update December 2022

Hello. Here are the statistics for December 2022. Please feel free to share your thoughts on this format. I've been doing it throughout 2022 and have heard good things, but with it being the start of a new year, I want to confirm it is still what you want. My goal has been to give you all the important info and trends in one quick infographic.

The things that stand out to me:

1. Year over Year average sold price for detached single family homes actually decreased year over year. Attached still saw a 6.5% appreciation. Makes sense, since at the entry level price point, which is the majority of attached homes, mortgage payments (even at these higher rates) are still about level with rent payments. (figuring about 15% down payment for this calculation)
2. While inventory has more than doubled since this time last year, it is only at 2018 levels, so not the "fall off the cliff - market bust" some sensationalist reporting I've seen is trying to predict.

My projection:

1. Things will be very slow the first quarter. Entry level will fare the best and might even trend upward come spring (subject to interest rates staying very close to where they are now.) Detached homes will continue to see some depreciation, but price reductions will be due more to over-pricing a home initially than the market dropping significantly.
2. Entry level buyers should look now. There is still some opportunity for discounted prices, but come spring, that will be hard to find.
3. Seller will likely benefit from the traditional strategy of putting a house on market towards springtime, versus now.
4. Investors - The window of opportunity has opened. I'm finding properties that will return around a 6% to 7% on your cash purchase via rental income. Even if you are only able to put 60% or so down, you would see about a 4% return on your down payment. What is interesting / promising is that if mortgage rates drop as predicted, the return on your money gets better with a rental, whereas savings/ cd rates will get lower.

Required disclosure - This is not to be considered an offer of an investment, investment advice or indicate any guarantees. Consult your financial and tax advisors before making an decisions.

Data for infographic obtained via REColorado. Information deemed reliable but not guaranteed.

It is a great time to strategize if you are buying as an owner occupant or as an investor. Waiting for signs of a recovery means you miss the sweet spot for making the most money. Call or IM me and we can grab a coffee and chat.

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. Information deemed reliable but not guaranteed.