In this solo market update, Colorado real‑estate guide Michael Rush explains how the recent 0.75 % (75‑basis‑point) Federal Reserve rate hike is not directly tied to mortgage rates, noting that mortgage rates actually slipped slightly after the hike due to a lag. He argues that this lag creates a short‑term buying window: buyers can lock in current rates before any potential temporary rise, and then refinance later when rates are expected to fall as the Fed moves to combat a likely recession. Rush outlines the current Greater Denver market conditions – prices are normalizing, with listings now selling at about 100.9 % of the list price (down from 106.5 %), and price reductions of roughly 2–3 % per month. He cites a 21.6 % year‑over‑year drop in buyer demand, attributing it to higher rates and broader market factors. Despite the slowdown, he forecasts modest future appreciation of 2 %–6 % annually, emphasizing that buying now is still advantageous compared with renting, which effectively costs a full 5 % interest rate. He concludes with a call to action, offering his phone number for inquiries.
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Hey everybody, this is Michael Rush, your Colorado real estate guide. I wanted to bring you a market update on what's going on in the greater Denver area and in our market specifically. But first, I wanted to touch on the recent rate hike that just happened of 75 basis points, 0.75%, that the Fed did. Now, that is the federal funds rate, which is not directly correlated to mortgage interest rates. And actually mortgage interest rates came down slightly when they did that rate hike. Usually they have a symbiotic relationship, but there's a lag period now. So that could be a great opportunity for buyers to lock in their rate right now, um, before we see what happens next, just in case, uh, interest rates do go back up temporarily. In the long term, I think interest rates are going to come back down next year. What I think is going to happen is that the Fed is going to send us into a recession like they usually do when they get control of inflation. They're really good at getting control of inflation by increasing the Fed fund rate and by doing multiple other things, but 99% of the time they send the economy into a recession, and then their main job is to get us back out of the recession and to increase demand and to pump the economy back up. And they do that by then lowering rates so that people are encouraged to borrow more money, including mortgage interest rates. So that's going to be a perfect time for buyers right now. I think it's a nice little window where we're having normalizing prices, we're seeing price reductions, we're seeing sellers come back down to an honest level of pricing their home instead of 106.5% of close price from list price. We're compressing about 2 to 3% per month, and that's at 100.9% right now, which means that's just coming back to a normalized level. And that's a perfect opportunity for buyers to get into that home if they're still able to afford that purchase price, and then they can refinance it in 6 months and 12 months down the road when we see interest rates come back into those low 4s, hopefully. Maybe even a better situation than that. That's something I'm looking into personally as well. So anyways, we're seeing much less demand year over year in the local Denver market, in the Colorado market. So 21.6% less demand year over year from last year, and that's for the various reasons that we spoke about— the kind of market conditions, the increased interest rates, things like that. But it's a nice little window for buyers to be able to buy right now, I think, Because I don't think prices are going to come down as much as the news wants you to believe. I think we're going to continue to see some compression, and that's your opportunity. But we're going to have appreciation in the years to come. Now, it's not going to be to the sky and to the moon like it had been. That was kind of unprecedented and unsustainable. But I think we are going to still see those 2% to like 6% appreciation rates. So it's still a great time to buy a home. When you're renting, you're paying 100% interest, so 5% is really not that bad when you think about it. Anyways, this is Michael Rush. Thank you so much for your time. I hope you have an awesome weekend. Your Colorado real estate guide. Give me a call if you have any questions. My number is 720-288-0592.
