With over a million people moving to Denver every year; developers buying up properties to convert to rentals and condos; and a historically low inventory, there's a lot of competition in the Denver real estate market. It's not uncommon for a home to receive several offers the moment it hits the market. Instead of getting caught up in a bidding war, try these tips for snagging the Denver home you love at a price that doesn't break the bank.
Pay both commissions
In the current Denver real estate market, sale prices are outpacing home appraisals. This causes trouble for both buyers and sellers. Because mortgage lenders base loan terms on the appraisal price, buyers who overbid are left with a balance they sometimes can't afford causing the deal to fall through.
Instead of offering above asking, pay both the buyers' and sellers' commissions. This tactic can be more comforting to sellers (especially those who have been burnt before by a deal that fell through). For a $500,000 home, that can be more than $30,000.
Appeal to their emotions
Sellers who have lived in their houses for many years have likely grown fond of their neighborhoods and attached to their homes. Many don't want to sell to investors or developers who will replace their homes with condos or rows of townhouses. In these cases especially, making an emotional appeal, like a handwritten letter, or video, can be a successful strategy to help you score the home of your dreams.
Adapt with the market
In this real estate market, it's realistic for homes to sell upwards of $50,000 above asking price. If your budget tops out at $400,000, look for homes in the $300,000-$350,000 range. That way you give yourself some wiggle room.
Consider purchasing a different type of property. The prices for condos and townhouses aren't increasing as quickly as they are for detached, single family homes. The average sale price for a condo or townhouse came in at $256,589 in April.
Get your information from the best source
Gone are the days of driving around on a Sunday afternoon to check out the properties for sale. With its lowest inventory in years, Denver is a competitive real estate market, and homes don't remain available very long. Most buyers do their research online, often using sites like Zillow or Trulia. These websites are only updated every three to four days, while COListings, a Colorado real estate search engine, is updated every 15 minutes from local MLSs. The data on those national sites is not very accurate, because it is not based on local statistics and real estate trends.
Get a leg up on the competition; use a local real estate search engine, like COListings. Our information is accurate, up-to-date, and our company is owned and operated by licensed real estate brokers who are available to chat with you on the phone or online while you browse our listings.
It's never been more important to have an experienced, locally-focused real estate agent to help you through the process. If you want to buy or sell a home in Denver (or anywhere in Colorado), contact us to learn more about how we can help.