Hey the election is next week. Have you heard?
Today we have just a touch less inventory than a month ago with 1,897 active listings in El Paso County as compared to 1,941 a month ago. Is this a seasonal dip into the holidays? Maybe and hopefully. Is this a pre election slow down because some people truly think the outcome will impact housing? Also maybe. We will know next month.
What we know now is that since the Fed lowered the funds rate we have seen a rip on interest rates straight back up. Not down, up. 
That V shape looking bottom in September I think is the day before or the morning of the Fed meeting. Since then we have ripped up roughly 80 bps on the 10 year yield and probably something similar on mortgage rates. Not good for payments, not good for buyers, and not good for sellers at all. However this isn’t news as rates have been at roughly this level for over 2 years now. What is somewhat surprising is the persistence of the belief that rates have to go down, that prices have to go up, and that everything is going to get back to the crazy market we saw in 2020. I guess blind hope is better than no hope, but a solid plan is better than both.
October 2024 PPMLS wide we had 998 sales at a median sold price of $475,000. Median days on market of 28. Original list to sold price dipping again at 97.75%. This year October actually was almost 20% better than last year’s October volume albeit at a slightly lower price. I think the big take away that everyone can see now is that inventory is relatively abundant, the active inventory is sitting on market an average of 30 days and the vast majority of listings I’m showing have little red arrows indicating price reductions next to them. There are still some listings selling in a day or two and some even getting multiple offers. That happens to sellers who are being aggressive and have the ability to undercut the market. That ability is something that most buyers that bought in the last 3 years do not have.
One thing I know to be a fact is that the “smart” money is a net seller of real estate right now. I say “Smart” because really these hedge funds and licensed brokerages that became iBuyers behaved themselves stupid AF. Maybe they really did just use real estate losses to launder capital gains in other ventures but if you look purely at their performance in the real estate field it’s been dismal. One of these companies stopped flipping houses like 2 years ago after losing close to a billion dollars in 2021. Another company that’s also exceptionally bad at this but still trying is losing roughly 70-100 million dollars per quarter. And that is considered doing pretty good when you’re a mediocre tech firm turned world’s worst flipper. At some point these fools are going to have to give up on the buy side and will end up liquidating whatever inventory they’re holding.
We’re in kind of a unique predicament. We have housing prices still near all time highs, really just 25k below the all time here locally. We have the stock market sitting at or near all time highs. We’ve got gold sitting at all time highs. We’ve got a diminishing demand for bonds as we see rates spike. Bitcoin is near an all time high. It feels a bit strange that all of the assets no matter how “safe” or “risky” they may be are at or near an all time high. It’s a strange predicament where both the optimists and pessimists are betting heavy in the market. Maybe the outcome of this election will help us figure out the true direction of this shit show.
For now I’m going to keep this short because really the last month is a continuation of September. The market has become much more balanced but affordability is nowhere to be found, not in Colorado Springs at least. We will keep our eyes close to the bond market and the job market nationally to try and gauge where this is going in the near future. For now I would remain calm as a seller and I would be aggressive as a buyer. Not in the sense of chasing deals but in the sense of finding opportunities to take advantage of. They’re showing up, and other buyers seem to be sleeping on it.