
Episode #22
4% Interest Rates?! Some Denver Builders Are Pulling Out All The Stops. What Should You Do If You're Considering Buying a New Home.
Explore the benefits of new construction and current mortgage trends. The landscape of real estate is shifting, and if you’re considering a new home, now is the time to explore your options. In this conversation, John Wilkinson and Kenda Ruck delve into the nuances of new construction homes amidst rising mortgage rates and what that means for buyers. ## The 4% Mortgage Rate One of the standout features discussed is the appealing 4% mortgage rate being offered by many new construction builders. As John points out, this is significantly lower than the current market average of around 7%. > "New construction builders are offering a 4% rate right now, which is really amazing." - John Wilkinson This rate can vastly change buyers' financial landscapes, making newer homes more accessible. ## Understanding Buyer Incentives Kenda highlights a crucial shift in how builders are approaching pricing and incentives. Instead of lowering home prices, builders are increasing incentives to make monthly payments more manageable for buyers. "Builders are not reducing the prices of their homes, but they are focusing on a different area to discount their homes, and that's the point of entry in that monthly payment." - Kenda Ruck For instance, builders like Lenar have ramped up their incentives, offering an average of 13% of the sale price in incentives, compared to only 5% historically. ## The Psychological Edge of Model Homes Both John and Kenda discuss the psychological factors at play when visiting model homes. The inviting atmosphere and appealing staging are designed to help potential buyers envision their lives in the space. > "When you walk into a model home, the first thing is it's bright and airy and it's brand new... It's done very intentionally." - Kenda Ruck However, it’s crucial for buyers to remain grounded and consider what the home will actually feel like with their furniture and lifestyle integrated into the space. ## Key Takeaways for Buyers - **Focus on monthly payments:** With rising interest rates, understanding how the monthly payment impacts your budget is more critical than ever. - **Consider long-term plans:** If you plan to stay in your new home for several years, a lower rate can be beneficial, but if your stay will be shorter, weigh your options carefully. - **Be aware of contracts:** Always have a realtor review any contracts from builders, as they may not follow the standard Colorado-approved agreements. As you navigate the current real estate market, remember to consider all angles when it comes to new construction. Keeping informed about mortgage rates, buyer incentives, and the psychology of home buying will empower you to make the best decisions for your future. --- For more insights, check out the full episode where John and Kenda explore these topics in depth.

