This is the MBA (mortgage banker association) count of number of buyers applying for a new mortgage last week. This year is the heavy blue line.

We started the year on record pace, matching 2021. Performance vs. historical has been eroding steadily as rates increased. Most recent weeks are quite a bit softer vs. history.

The overall Denver market was down around 12% in transaction count for June ’22 vs June ‘21. The under contract count suggests that July will be similar for the market. This indicator shows that August and September will track along with that slowness.

In the last forty years, we’ve had six mortgage interest rate spikes, where rates went up 1% or more in a hurry. In those six, prices never went down, but the average transaction count in the market was off an average of 12%. We’re right on track with the historical trend. Everything is going according to plan for the market slow down.

What does this mean for clients?

Buyers: Less purchases = more inventory growth. Less bidding above ask price. A chance to get an inspection notice accepted. Easier time overall, but certainly not a buyers market.

Sellers: Much more competition from other sellers than we have seen for a few years. Much less showing traffic than 2020/21. Every showing counts. First offer (usually not multiple offers) will usually be the best offer and you have to make it work.

Trade up: Overall much, much easier for trade up clients than 2021. Even though rates are higher, keep in mind that in the last six recessions (40 years of history), rates dropped in EVERY recession. You can buy now and plan to refinance in a year or so at a lower rate.

Let me know if you are interested in exploring your buying, selling, or trade up options this year!

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