Metro Denver Real Estate Market Report - July 2019
With metro-Denver housing inventory at its highest level since October 2013 and interest rates still low, now is a good time for homebuyers. On the flip side, with home prices peaking now is also a good time for home sellers; making for a more balanced market.
#DMAR Market Trends
Data Source: REColorado
Housing inventory is up 28 percent year to date from 2018. The first half of this year ended with the most active listings, at 9,520 at the end of June, since October of 2013 which was at 9,734.
For perspective, the record-high June for active listings was in 2006 with 31,900, and the record-low was in 2015 with 6,197 listings.
“I’ve heard this year referred to as the ‘Goldilocks year’ in Denver real estate - not too hot, not too cold,” said Jill Schafer, Chair of the DMAR Market Trends Committee and Metro Denver REALTOR®. “We are halfway through 2019 and things feel different than they have in the past few years. In some price points and areas, the market is still very strong for sellers. In others, buyers are gaining the advantage. Why? Continued low interest rates and more housing choices.”
The average sold price in the residential market dipped 0.54 percent from May’s $502,518 to $499,807 at the end of June, but it crept up 1.64 percent year to date.
Furthermore, homes have been staying on the market longer before going under contract this year. The median days on market was up 66.67 percent from six days at this point last year, to 10 so far in 2019. Meanwhile, days on market for all price ranges indicates a seller’s market except homes priced $1 million and up where it’s an equal market between homebuyers and sellers; with 5.16 percent months of inventory for single-family homes.
“I’ve heard listing agents struggling with pricing now that the market is evening out,” adds Schafer. “Homebuyers want to put in low-ball offers only to find out there are other buyers who are willing to come in at asking price, or even higher. The market isn’t what it was, but it’s still strong and looks like it will continue to remain that way. With interest rates staying low and inventory going up, it is really a perfect time to buy. Prices may be high, but are leveling off so it’s still a great time to sell, too. In my opinion this market is just right for everyone.”
Our monthly report also includes statistics and analyses in its supplemental “Luxury Market Report” (properties sold for $1 million or greater), “Signature Market Report” (properties sold between $750,000 and $999,999), “Premier Market Report” (properties sold between $500,000 and $749,999), and “Classic Market” (properties sold between $300,000 and $499,999). In June 2019, 238 homes sold and closed for $1 million or greater – down 15.60 percent from May and 9.85 percent year over year. The closed dollar volume in the luxury segment year to date was $1.8 billion, up 2.62 percent from last year.
The highest priced single-family home that sold in June was $4,775,000 representing five bedrooms, seven bathrooms and 6,406 above ground square feet in Denver. The highest priced condo sale was $6.74 million representing three bedrooms, four bathrooms and 4,761 above ground square feet in Denver. The listing and selling REALTORS® for both transactions are DMAR members.
According to Schafer, more choices for homebuyers means sellers have had to make price adjustments to be competitive. Sellers with homes priced between $1,500,000 and $1,750,000 have been taking the biggest cut with a 91.20 percent sale-to-original-price ratio for single-family homes and 94.9 percent for condos. The overall residential market’s close-price-to-list-price ratio year to date was 99.41 percent; so, sellers were getting, on average, more than the asking price at this point in the past four years.
Year to date in the Luxury Market overall, single-family home sales were down 2.72 percent year over year, but up 34.05 percent compared to 2017 with 242 more single-family homes sold this year compared to 2017. The luxury condo market also saw striking results with sales up year to date at 38.78 percent year over year and 4.26 percent since 2017, with 42 more luxury condos sold since 2017.
“Making a splash and sliding downward are the days on market in the single-family luxury segment,” said Brigette Modglin, DMAR Market Trends Committee member and Metro Denver REALTOR®. The average days on market year to date was 58, down 13.43 percent year over year and 22.99 percent since 2017. Also sliding downward were the luxury condo average days on market, down 19.70 percent from one year ago from 66 to 53 days on market, and down 14.29 percent from 2017.
“While things seem to be pointing in the right direction with more inventory in the luxury segment of the market, sales of single-family luxury homes were slightly down from 1,067 sales year to date in 2018 compared to 1,038 year to date in 2019, a 2.72 percent decrease,” adds Modglin. “Diving into the numbers, they still look good as we are in a more balanced market and all signs show this is good for both buyers and sellers in the Denver Metro Luxury Market.”
Notably, things are changing in the Signature Market too, particularly in the condo segment. The year-to-date average days on market for a condo in this price range is 58, and the median is 24. Compared to this time last year that is an increase of 31.82 percent and 84.62 percent, respectively. “Given this information, it won’t be a surprise to hear that there are 5.59 months of inventory for condos in this segment, more than any other price segment we monitor,” adds Taylor Wilson, DMAR Market Trends Committee member and Metro Denver REALTOR®.