Is Now Still The Time To Buy Durango Real Estate?

An improving real estate market is now old news!  Durango, Colorado real estate has seen steady improvement in sales since 2009, and the prices of homes have started a very modest increase since the third quarter of 2012.  In some areas of the County, we have very tight inventories, especially in the lower and mid-price ranges, and those in close proximity to Durango.  These segments of the market are experiencing a sellers market; or, depending on inventory levels, a balanced market.  The National Association of Realtors describes a sellers market has an inventory level below five months, a balanced market is a five to seven month inventory, and a buyers market is described as more than seven months of inventory.  In our upper price ranges there is significant inventory, and thus a buyers market.  As inventories of homes on the market continues to reduce, it will continue to push prices upward.  It is very important to look at each segment of the market to predict the potential for changes in prices, based on the effects of supply (homes on the market) versus the demand (number of homes selling).

The big news in the last 45 days was the rates on mortgages, as they have increased about 1% in that time period.  Higher mortgage rates lower the affordability of homes, and limit the number of buyers that may qualify.  Should savvy home buyers wait for interest rates to go back down?  Maybe, but it is a risky proposition.  It appears the rates will stabilize for awhile in this range, but as the economy improves, both Doug Duncan, Chief Economist for Fannie Mae, and Frank Nothaft, chief economist for Freddie Mac have suggested the rates will continue upward movement, perhaps to 6.5%-7%.  If these rate hikes happen in the future, a home buyer would benefit from purchasing sooner rather than later.  The combination of the median price increasing and a tighter inventory of homes on the market further supports this decision