The Colorado real estate market has had quite the year — leaving us all eager to see exactly where it’s headed.
The Big Picture
What’s happening right now in the national economy?
Naturally and as expected with the rollout of the vaccine, now over 50% of the adult population has received at least one dose (as of April 2021). Why is that important? “We are a nation of consumers, and what have we not been doing for the last year? Consuming!” notes Gardner.
Around 70% of our economy is built on consumption, or buying things to put it simply. “As we start getting the vaccine and begin to feel more comfortable going out, we’re going to start spending more money,” said Gardner. “Why? Well, for many people, even through the pandemic period, a lot of us were still working, but not spending.”
This will have both an impact on the economy and employment as well. Within the first three months of 2021, America has recovered over 1.6 million jobs, with the unemployment rate down 6% and trending in the right direction.
All in all, signs are pointing to robust growth as we spring back from the pandemic. Gardner predicts an overall growth rate of 6% — which is much higher than the average 2-3 times higher than those reported in recent years.
The Big Question: Is The Colorado Real Estate Market In a Bubble?
In short, no. Based on Colorado real estate market activity, Gardner predicts that while home prices will continue to increase, the rate of home price growth is expected to decline.
Learn more about recent Colorado real estate market activity in The Q1 2021 Gardner Report found on the Windermere Colorado site HERE.
Interest Rates: Historically Speaking, Remarkably Cheap
Where are interest rates headed in the next 12 months?
As we go through the year we will see interest rates continue to rise. However, from a historic perspective, they will remain remarkably competitive. Gardner predicts that for 2021 rates will average between 3.5-3.6%, and will grow steadily into 4% in 2022.
Will we see any improvement in available inventory for the Colorado real estate market?
Gardner predicts we can expect to see an increase in listings due to the simple fact that many people put any plans to sell their properties on hold during the pandemic period. He also notes that increases in new construction and a motivation to sell based on the new post-pandemic lifestyle (such as WFH) will play a big part for the better.
This analysis is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the Colorado real estate market, please don’t hesitate to contact Suzanne Ekeler with Windermere Real Estate.