Colorado’s hot real estate market maybe creating a new mini-bubble, some experts are saying. We are experiencing a high demand for homes, along with low interest rates, and a very slim inventory is creating a seller’s market. Sellers are getting three or more offers and the appraisals are struggling to catch up with the new sellers’ market.
New buyers are finding homes only to be told there are multiple offers before writing a contract. They are then forced to offer more than the asking price for the home, which is higher than the property appraises, sometimes by thousands of dollars.
When that happens, formulas used by a bank or mortgage broker to determine down payments are skewed, leaving would-be homeowners on the hook for more money at the closing table than some can afford. This leaves some clients to either walk away from a deal or come up with the extra cash or they can try and negotiate a lower price.