Denver would-be homebuyers are facing several challenges as they navigate the housing market, namely high prices and low inventory. But there’s another trend that’s making things tough for house hunters: the “all cash” offer from investors and well-prepared buyers ready to write a check on the spot. Average buyers taking out a standard conventional loan typically don’t have the collateral to win a bidding war from competing all-cash offers.

In the last couple of years, you couldn't make an offer on a home without facing stiff competition from 5 or 10 other buyers, some of them ready with all cash. But industry pros say that's starting to change as the red-hot market begins to slow.

According to Daryl Fairweather, chief economist for Redfin, that the good news is that right now, buyers probably aren't going to face as much competition. Fairweather says with mortgage rates close to 7 percent, the market is slowing down and the number of homes purchased with cash is starting to fall.

According to Redfin, about one-third of US homes were paid for with all cash in December 2022, down slightly from an eight-year high in November.

If you have the funds, a cash offer is the way to go to avoid those high interest rates. But there are ways to beat all-cash buyers:

·       Be pre-approved for your loan.

·       Have your down payment ready (and the more you can put down the better).

·       Consider putting down more "earnest money" to show how serious you are.

·       Let the seller know you plan to live there, which can give you an edge over investors looking to flip or rent out the house.

The spring season will be heating up soon, so if you’re in the market for a new house this year there’s no time like the present to start planning. Contact one of the experienced professionals at Metrowest – we’d love to talk about your options!