Paying Over List Price

Alright, it’s no secret that Denver’s real estate market is 🔥

When you’re buying a house, it would be fantastic if you can negotiate a great deal on purchase price...or even if you can just write a straightforward clean list-price offer. However, in a market where inventory is extremely low and demand is crazy high, the result is buyer competition, and subsequently often offers over list price.

We have just over 5,000 active listings in all of the Denver area. This is about 1/6th of the amount we’d need to have a balanced market (🤯). Colorado is a great place to live...and a lot of people want to put down roots here. Here are a few reasons that it may make sense to pay over list price in order to stake your claim on Denver real estate:

LIST PRICES AREN’T BLACK AND WHITE • They’re based on the listing agent and the seller’s opinion of the value. Ultimately a home is worth what a buyer is willing to pay for it. If there’s market demand that says a home is valued higher than perhaps it is.

YOU MIGHT HAVE TO • If a home is popular and has multiple offers, it may be necessary in order to have a fighting chance of a seller accepting your offer over another.

THE COST OF WAITING OUTWEIGHS THE HIGHER PRICE TAG • Historically in Denver, homes appreciate in value (typically it’s in the range of 2-5% a year, but this year it’s been upwards of 7%). That means the cost of the exact same home today will likely be thousands more next spring/summer. If you pay over list for a home now, it will likely recoup that value in the upcoming months anyway. If you’re planning on owning for a few years, the investment can make sense.

INTEREST RATES ARE SUPER LOW • Like crazy low. That can make the difference of tens of thousands of dollars in purchasing power. They’re not expected to last forever, which is why so many people are taking advantage of them. A lower rate can offset a higher price and keep your monthly payment the same.

Ultimately, as much as competition breaking into the market might not be ideal for a buyer...it’s a great thing to own property in a place like Denver that’s a desirable place to live with stable home values + consistent appreciation!

Q’s? 👇