Closing out the year, the Denver real estate market experienced notable shifts in December 2023. While interest rates began to decline in November, December’s figures echoed the city’s seasonal patterns. The median close price dropped by 2.8 percent to $551,993, and closed sales decreased by 7.65 percent to 2,620. Notably, the median days on the market (MLS) increased by 31.82 percent, rising from 22 to 29 days.
However, a year-over-year analysis reveals a more optimistic perspective, considering the same seasonal factors. New listings decreased by only nine homes compared to the previous year, totaling 1,725 new homes for sale. Pending sales increased by 10.87 percent, reaching 2,471 homes. The median close price experienced a modest increase of just over $1,000, and median days in MLS decreased slightly from 30 to 29 days.
Breaking down the market further, single-family homes outperformed attached homes year-over-year. New listings for single-family homes increased by 4.33 percent, pending sales rose by 12.98 percent, and the median close price increased by 2.25 percent to $613,500. The close-price-to-list-price ratio improved to 99.55 percent, and median days in MLS decreased from 32 to 29 days. Conversely, attached homes faced some challenges, with new listings down by 10.77 percent and closed sales declining by 10.57 percent. Despite this, interest rates aided pending sales with a 5.95 percent increase, and the median close price rose by 2.46 percent to $418,701.
If we take a look back at 2023, the real estate market functioned similarly to a pre-pandemic 2019, with a slight decline in sales volume but a higher median close price. While not reaching the same levels as a few years ago, home prices will likely continue to rise, particularly if demand surges. Many in the market also anticipate an earlier start to the selling season in 2024, driven by pent-up demand, favorable lending terms, and warmer temperatures.
The market for homes priced $1,000,000 and higher in December showed resilience to interest rate fluctuations. December witnessed increased activity, attributed to decreased interest rates, strong end-of-year investment returns, and a dovish narrative from the Federal Reserve.
Despite a slight decrease in closed properties from November, there was a notable increase in total sales volume compared to December 2022. Pending sales showed a seasonal dip but were significantly higher than the previous year, indicating robust buyer demand. The year-end summary revealed a decrease in closed sales for detached and attached homes, in line with trends seen in other market segments.
As the real estate market enters 2024, we have a lot of optimism and we’re projecting less volatile interest rates and a healthier balance between supply and demand meaning that overall the Denver Market seems poised for a more stable and positive year ahead.
*Updated as of January 5, 2024