The Colorado real estate market is experiencing significant shifts as we move through 2025, with changing buyer and seller dynamics creating both challenges and opportunities. In our recent Fire on Fire podcast episode with Paul and Jamin, we explored what’s actually happening on the ground—from concessions becoming standard practice to the impact of potential tariffs and supply chain disruptions. Understanding these trends is essential for anyone looking to buy, sell, or invest in today’s uncertain market.

Episode Overview

This discussion brings together real-world experiences from active real estate professionals to provide an up-to-date market assessment. While data might still technically show us in a seller’s market with inventory below the balanced threshold, the practical reality feels quite different. Throughout our conversation, we examined recent transactions with significant concessions, the evolving impact of HOA concerns on condo values, current building challenges, and strategies sellers are adopting to maintain their competitive edge. These insights reveal a market in transition that requires new approaches from both buyers and sellers.

https://youtu.be/uFZIVEEx3zs Timestamps

(00:00) Introduction
(02:45) Successful Listing Strategy in Challenging Market
(07:10) Tariff Impact on Housing Supply Chain
(11:03) Single Family Versus Condo Market Dynamics
(16:12) HOA Challenges Affecting Property Values
(21:32) Construction Project Updates and Affordable Housing
(26:49) Agent Commission Negotiation New Landscape
(32:19) Market Cycle Analysis and Rental Demand

The New Normal: Full-Price Offers with Significant Concessions

One of the clearest signs of our shifting market is the emergence of a new standard pattern in transactions: full-price offers paired with substantial concessions. Jamin shared his recent experience selling a property in Castle Rock, which demonstrates this dynamic perfectly.

“We automatically started off with the only offer we had was a full price offer with a $14,000 concession right off the bat. And then you always worry about what the inspection is going to be,” Jamin explained.

• Buyers are requesting significant concessions (often $10,000-15,000) for closing costs or rate buy-downs, while maintaining full asking prices since price reductions provide minimal monthly payment relief.
• Successful sellers are now proactively addressing potential inspection issues before listing, with Jamin noting: “We went ahead and did a bunch of stuff up front. We got a cracked window fixed, replaced. We did a little bit of roof work that needed to be done, got the furnace cleaned and serviced beforehand.”

This approach helps prevent the “double whammy” where buyers take the initial concession and then use inspection findings to negotiate prices down further. By anticipating and addressing common inspection concerns like roofs, HVAC systems, and structural elements in advance, sellers can maintain more control over their bottom line.

HOA Challenges Creating Downward Pressure on Condos and Townhomes

While single-family homes have shown resilience, the condo and townhome market is facing more significant headwinds due to escalating HOA issues and financing challenges.

“I think that’s where I see a lot more potential for a bigger correction,” I noted during our discussion. “Between HOAs, insurance and deferred maintenance…many are falling out of conventional financing guidelines as well.”

• Buyers are now conducting unprecedented levels of due diligence on HOA documents, with Paul noting: “I’ve never seen so much due diligence on HOA documents…The first question that agents ask when you have a condo with an HOA is, how is the HOA doing? And does it have reserves?”
• Some associations are implementing substantial special assessments with minimal notice, as Jamin shared: “We had one that we were looking at selling…and HOA had voted the night before to do a $12,000 assessment, and then the next day tried to ACH that $12,000 out of everybody’s account.”

These concerns are making many buyers hesitant to consider properties with HOAs, creating potential longer-term implications for this segment of the market. Investors and owners of these properties may need to reassess their strategy as financing options narrow and carrying costs increase unexpectedly.

Supply Chain Disruptions and Construction Challenges

The potential for tariffs and supply chain disruptions is adding a new layer of complexity to both the resale and new construction markets, with builders already pulling back in response to uncertainty.

Paul shared his experience with his current construction project: “Cabinets, you know, they told us we need to get them ordered before May 1st because they saw they were definitely having a price increase…Our builder was pretty confident that we could find a better deal somewhere else, but they would also be hit by tariffs potentially, unless they were made here somewhere in America.”

• Some builders are already laying off portions of their workforce, with one major national builder reportedly cutting 10% of staff as they manage excess inventory of spec homes.
• New construction buyers are seeing increased incentives as builders try to maintain sales velocity, with Paul noting: “They’re offering incentives like crazy now…rate buy-downs, yeah, that’s huge right now.”

For those considering building or renovating, these challenges suggest ordering materials early when possible and building in larger contingency funds—potentially 15-20% rather than the traditional 10%—to account for unexpected costs and potential price increases.

Market Metrics vs. On-the-Ground Reality

One of the most interesting aspects of the current market is the disconnect between traditional market metrics and what agents are experiencing with clients day-to-day.

“From like the data, this is what’s so weird right now,” I explained. “The data still shows us in a seller’s market because we’re still sub three months inventory or right around there. So it’s still in a seller’s market, but it certain doesn’t feel like one.”

• Despite inventory levels that historically indicate a seller’s market (below 15,000 active listings in the Denver metro area), properties are seeing fewer showings and longer days on market.
• Buyers are showing increased willingness to walk away over relatively minor issues, with Jamin noting: “They’re willing to terminate on inspection if they don’t get exactly what they want, they’ll terminate. And it could be over five or six hundred bucks, which I haven’t seen before.”

This disconnect suggests we may be approaching an inflection point in the market. The historical data indicates we would need approximately 5,000-6,000 more active listings to reach a balanced market by traditional metrics, but buyer behavior is already reflecting increased leverage.

Conclusion

The Colorado real estate market in 2025 is demonstrating why local knowledge and real-time insights are so valuable during periods of transition. While we aren’t seeing dramatic price drops in most segments, the dynamics have clearly shifted from the extreme seller’s market of recent years. Successful transactions now require more preparation, flexibility, and realistic expectations from all parties.

For sellers, this means addressing potential inspection issues proactively, being prepared for concessions, and pricing strategically. For buyers, today’s market offers more leverage than we’ve seen in years, particularly for those with secure employment and strong financials who can navigate the current interest rate environment.

To stay informed about these evolving market conditions and connect with other investors and real estate professionals, join us at one of our upcoming Fire on Fire community happy hours or mastermind events. These in-person gatherings provide valuable opportunities to share experiences and strategies in this dynamic market.

Links from Podcast

• Property Llama