Colorado Real Estate News

Home Prices Appreciate at A Slower Pace in Denver

Home Prices | Denver Real Estate

This past month, many people celebrated Independence Day by watching fireworks, enjoying a barbecue, or perhaps escaping to the mountains. This year, Denver’s continued robust housing market was another cause for celebration. The Denver Metro Association of Realtors released its latest report on home sales activity in the metro area on the 4th of July. The report found the local housing market remains strong. While home prices are appreciating at a slower pace than in recent years. That is good news for prospective buyers, who on average are no longer facing double-digit price increases. At the same time, sellers are still enjoying solid increases in the value of their homes.

The average price of a single-family home sold last month set a new record of $539,934. That is less than a 1% increase from May and an 8.75% increase from June 2017. When you throw condos and town homes into the mix, the average price of all homes hit a record of $492,029, up slightly more than 1% from May and an 8.8% increase on a year-over-year basis.

Buyers also have more homes to choose from in June than they did in May. There were 7,436 active listings on the market in June, up 15.52% from May. Such a big percentage increase from May is not unusual. This time in 2017 and 2016, for example, the month-to-month percentage jumps were about 20% and 24%, respectively. Year-over-year, the number of active listings increased by 5.34%. The last time more active listings were on the market was at the end of June 2014. At that time, there were 7,791 homes on the market.

The number of homes placed under contract also picked up a bit in June. There were 6,043 homes placed under contract in June, a 2.46% improvement from May and a similar increase of 2.55% on a year-over-year basis. In the first half of the year, 37,311 new listings came on the market. That’s a 1.45% increase from the 36,779 new listings in the first six months of 2017.

Sales activity in the first half of the year was not bad considering rising home prices and interest rates. There were 27,228 total homes sales in the first six months of 2018. Which is a 3% drop from total sales in the first half of 2017. The average sales price of all homes in the first half of the year was $476,100, a 10.47% percent jump from the average sales price in the first half of last year. Despite the dip in sales, thanks to higher prices, the total sales volume in the first six months of the year hit a record $12.96 billion, a 7.08% increase from $12.1 billion in the first half of 2017.

Yet, the market remains tight. There was only a 1.43-month of inventory of single-family homes available to buyers at the end of June. That translates to slightly more than 6-week supply, which, believe it or not, is almost an 11% increase in MOI from June 2016. For homes priced from $200,000 to just under $400,000, there was less than a one-month supply of homes on the market. The luxury housing market is the most balanced of all markets, with a 4.64-months of inventory of homes priced at $1 million or more. That is about a 17% drop in the MOI for luxury homes.

Kentwood Real Estate broker and DMAR Markets Trend Committee member Jill Schafer described the luxury market as “astounding.” In the first six months of the year, a record 978 luxury single-family homes were sold, a 32.52% increase from the same period in 2017. The sales volume of luxury single-family jumped 32.6% from a year earlier to $1.486 billion. The total sales volume for luxury hit $1.63 billion, when including luxury condos.

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The Number of Homes on the Denver Real Estate Market Continue to Rise

Denver Real Estate

There is good news if you are a prospective home buyer in the Denver area. Last month, the market experienced a near 25% increase in the number of homes on the market from April, with an active inventory of 6,437 single-family homes, townhomes and condominiums. While inventory normally rise on a month-to-month basis this time of the year, as the historic strong summer selling season kicks off, this May saw an especially big percentage increase. In May 2017, for example, the market experienced a 9.96% increased from April. Therefore, the percentage increase this May was about 2.5 times greater than a year ago. Year-over-year statistics showed a 9.19% increase in active listings this May, compared to a 7.91% increase in May 2017 from May 2016. Some 7,748 homes hit the market last month. And the number of new listings on the market rose by 12% from April.

Meanwhile, home prices rose only slightly month-over-month in May, but continued a double-digit march upward on a year-over-year basis. The average price of all homes sold in the metro area is approaching $500,000, a milestone already reached for single-family homes. The average price of all homes sold last month was $490,355, less than a 1% increase from April. However, it was a different story for all homes on a year-over-year basis, with prices rising by 11.37%. The average price of a single-family home, meanwhile, was $540,624, largely unchanged from April, but up 10.67% from May 2017. The sales activity also picked up on a month-to-month basis.

The 5,235 sales of all homes marked almost a 6% increase from May and the 6,178 homes placed under contract was about a 5.5% increase from the previous month. The increase in listings was reflected in the months of inventory. There was only a 1.28-month supply of single-family homes on the market in March. As incredibly low as that is, the months-of-inventory for single-family homes was up 8.5% from May 2017.

The good news for first-time home buyers is that on a percentage basis, the months of inventory almost doubled at some price points. But don’t let the large percentage increases fool you, because the numbers are small. For example, there was 1.92-months-of-inventory for homes priced from $100,000 to $199,999 last month, a 97.9% increase from May 2017. Still, there were a mere 23 listings available in that price range last month, so it is easy to imagine price wars for the two dozen homes listed below $200,000. But what is encouraging is that the luxury home market continues to be the strongest in the Denver area on a percentage basis. At the end of May, there was a 4.16-month supply of unsold homes in that price range. That is a 28.6% drop in luxury inventory levels from a year earlier. The luxury market is the only price point that is in equilibrium between buyers and sellers in the Denver area. Despite the increase in inventory levels, the overall housing market in the Denver area remains a strong seller’s market.

A separate report by Kentwood Real Estate showed that 178 single-family luxury homes priced at least $1 million sold last month in the Denver area. That is a 19.5% jump from May 2017. That makes last month the best luxury home market for any May on record. Total dollar volume for luxury, single-family homes soared by 18% to $265 million on a year-over-year basis. Not only were there more luxury home sales, but they sold much faster. The average days on the market for a luxury home was 68 days, a whopping 34% drop from the 103 days it took to sell a luxury single-family home in May 2017, Kentwood reported.

Colorado Real Estate News

April Sees a Spike in Denver’s Inventory of Homes

Small House With Sold Label Attached To ItOften, when taking the pulse of the housing market, we look at the average sales price of a home, the number of homes that have sold, and the active inventory. These are all important metrics when determining the health of the market. Indeed, in April, the average price of a single-family home sold in the Denver metro area soared to a never seen-before record of $543,068, according to a report by the Denver Metro Association of Realtors.

One of the most promising measures of market strength was not the record home price, but the number of homes placed under contract. According to DMAR, 6,097 single-family homes, condominiums, and townhomes were placed under contract last month. That was the best April for under contracts since 2013, when 8,223 homes were placed under contract. Last month was the first April since 2014 that more than 6,000 homes were placed under contract.

One of the best indicator of the sales activity in any given month is how many homes go under contract. Sales, by contrast, measure the number of homes that were placed under contract in previous months. There were 4,384 total sales last month, almost a 9% drop from April 2017. Of course, a certain number of homes placed under will not close. But in Denver, where there is only a 1.24-month supply of unsold single-family homes, some buyers are often able to purchase a home that did not close under its initial deal.

Buyers also had more homes to choose from in April than in March. 6,917 new listings hit the market in April, a 9.12% increase from a year earlier and almost a 5% increase from March. Homes also sold much faster in April than in March. Buyers, on average, snapped up listings after they were on the market for a mere 20 days in April 23% faster than the sales pace in March.

Sellers also did a good job of listing their homes at the appropriate price. The average closing price for a single-family home was slightly above the average listing price, according to DMAR. Overall, homes closed at just under 1% over the listing price. The mix of homes sold likely helped drive up the average price of single-family homes in April.

Once again, the luxury market of homes priced at $1 million or more was the best-performing price strata. A total of 196 luxury single-family homes and condominiums traded hands last month. Which was the best April on record for luxury home sales.  Luxury home sales were up 33.33% from a year earlier. Luxury single-family home sales led the way, with 184 homes closing, a record for an April. That was a whopping 40.46% more than a year earlier. Total sales volume of luxury single-family homes rose to $281.6 million, soaring 41.13% from April 2017.

Colorado Real Estate News

February 2018 Housing Market Report

February 2018 Housing Market ReportDenver, the most expensive housing market between the two coasts, hit an important milestone in February. For the first time ever, the average sold price of a single-family, detached home topped $500,000, at a record breaking $502,986. The year-over-year appreciation was up 11.78% from February 2017. The dramatic price increase came as the total sales volume posted a double-digit drop. The 2,002 single-family homes sold in February marked a 10.59% reduction in closings from a year earlier, DMAR data shows.

February 2018 Housing Market Report

Home prices are rising while at the same time mortgage rates are rising. Rates are now averaging close to 4.45% for a 30-year mortgage, while rates below 4% were available not long ago. Part of the reason home prices are going up so quickly, especially so early in the year, is because some people are bidding up home prices before they rise even more.

February 2018 Housing Market Report

Historically, when single-family home prices shot up, more consumers – especially first-time buyers – chose less expensive condos and townhomes. With an average price of $345,632, attached homes are significantly less expensive than single-family homes. However, condo prices have risen even more than single-family homes jumping 16.95% from February 2017.

February 2018 Housing Market Report

Another, often overlooked, reason the average price has risen so much is the mix of homes being closed. That is, more expensive homes selling in any given month can drive up the average price. Indeed, the $1 million and up price range showed the most improvement of any price strata from a year earlier. 102 homes priced at $1 million and over sold last month, a whopping 56.92% increase from the 65 luxury homes that traded hands in February 2017.

February 2018 Housing Market Report

At the end of February, there was a 7.83-month supply of unsold $1 million-plus homes on the market. That’s a 37.46% plunge from the 12.52-months of inventory for luxury homes a year ago. Overall, there was a 1.51 month supply of homes on the market, a slight increase from the 1.46 months of inventory on the market in February 2017. However, buyers will find slim pickings for homes priced between $200,000 and just under $500,000. In that price range, there is less than a month’s supply of unsold inventory.

February 2018 Housing Market Report

An uptick in the number of homes on the market, both on a month-to-month and a year-over-year basis is good news for prospective buyers. There were 4,084 houses, both single-family and attached, on the market at the end of February, a 5.56% increase from January and a 5.31% increase from February 2017. If inventory levels continue to rise, it could help to dampen the rising prices.

February 2018 Housing Market Report

Colorado Real Estate News

January 2018 Housing Market Report

January Housing Market ReportThe Denver-area housing market kicked off the new year with a historically low number of listings for any January on record. There were a mere 3,869 actively listed homes available for buyers in the first month of 2018, a 3.01% dip from a year earlier, according to a recent report by the Denver Metro Association of Realtors. The low inventory led to a double-digit percentage drop in sales, but also a double-digit increase in average sales price. The 2,736 single-family homes, town-homes, and condos that traded hands last month represented a 15.45% year-over-year drop and a whopping 36.22% drop from December, according to DMAR’s data. The number of sold homes equated to 70.7% of the active inventory.

January 2018 Housing Market Report

The brightest news from the report was that 4,085 homes were placed under contract in January, representing a 34.5% jump from December and a 9.76% percent increase from January 2017. There were almost as many homes placed under contract last month as the 4,182 new listings added to the market in January. The number of listings added to the market jumped an amazing 77.5% from December and marked a 9.69% increase from January 2017. Buyers in January were snapping up homes soon after they hit the market. In other words, “they are buying off the top,” rather than purchasing homes that had been sitting on the market.

January 2018 Housing Market Report

The first month of the year ended with a mere 1.48 months of inventory. That’s less than a 6.5-week supply of homes on the market. From homes priced from $200,000 to $499,999, there is less than a month’s supply of homes on the market. The low inventory coupled with relatively strong buyer demand, once again led to double-digit increases in sale prices on a year-over-year basis. The average price of all homes sold last month was $449,429. That represents an 11.84% increase from a year earlier and a 1.56% increase in demand. The average sales price of a single-family detached home in January was $490,932, almost a 10% increase from a year earlier.

January 2018 Housing Market Report

Condos and other attached homes rose even more. The average sold price of a condo in January was $354,613, a 22.7% increase from a year earlier. Despite the rising prices, the drop in the number of sales led to a 5.4% drop in total sales volume on a year-over-year basis. The sales volume for all homes was $1.229 billion in January, compared to $1.3 billion in the first month of 2017, according to DMAR.

January 2018 Housing Market Report

Colorado Real Estate News

2017 End of Year Market Report

End of Year Market ReportLast year, Realtors sold a record $25 billion in Denver-area homes. Lets put that into perspective. Twenty-five billion dollars is more than the GDP of Iceland. Sales of homes, town-homes and condos toppled the previous record of $22.4 billion set in 2016 by almost 12%, according to a recently released report by the Denver Metro Association of Realtors. Last year marked the fifth consecutive year of record sales volume, as home prices soared to never seen before heights.

End of Year Market Report

Looking back, sales volume in 2017 was 52.4% higher than in 2013. A total of 57,788 homes closed last year, which is slightly more than the combined population of Littleton and Greenwood Village. It’s also a 2.93% bump from the number of homes that traded hands in 2016. Home prices continued to rise, but not at the double-digit year-over-year increased booked in 2016 from 2015, and 2015 from 2014. Last year, the average price of all homes sold was $434,097, an 8.78% increase from 2016. The average price of a single-family home sold was $480,140, just under an 8.7% increase from 2016.

End of Year Market Report

Prices rose because demand continued to out-strip the supply. The year ended with a mere 3,854 unsold homes on the market, a 9.64% drop compared to the end of 2016. Make no mistake, there are very few homes available in Denver’s seller’s market. There was only a one month inventory of homes on the market at the end of December, a 7.3% drop in supply from a year earlier. For homes priced from $200,000 to just under $500,000, you need to measure the inventory in weeks, not months. For homes priced from $300,000 to $399,999, for example, there was only 1.3 weeks of inventory for buyers to choose from.

End of Year Market Report

The only price strata that arguably is in equilibrium between buyers and sellers is for homes priced at $1 million or more. In that price range, there is 5.88 months of inventory, which marks almost a 23% drop in the supply of luxury homes from December 2016.

End of Year Market Report

Will the trend of ever-increasing sales volume continue in 2017? It’s hard to say. Certainly, with tax law changes that will eliminate or reduce the benefits of the mortgage deduction, the housing market is in uncharted waters.

Colorado Real Estate News

November Housing Market Report

November Housing Market ReportDenver boasted record temperatures in November, even reaching an astonishing 81 degrees one day. Alas, the housing market sales did not see the same trend. The market cooled more than the typical seasonal slowdown. Why? Because there were a record low number of homes available to purchase for a November last month.

November Housing Market Report

There were 5,131 single-family homes, condos, and town-homes actively listed in November, according to the Denver Metro Association of Realtors. That marked a 7.8% drop on a year-over-year basis. For comparison, November 2016 showed only a 2.08% drop from November 2015. Inventory levels fell 18.71% from October, although surprisingly, that wasn’t much bigger than the 17.37% month-to-month drop the market experienced last year. Overall, there was only a 1.27-month supply of unsold homes on the market in November, a mere 5.5 weeks of homes on the market. That’s 13.6% lower than in November 2016.

November Housing Market Report

The lack of inventory is especially severe for homes priced from $100,000 to just under $500,000. In that price band, there is less than a month’s worth of inventory. For homes priced from $200,000 to $299,999, there is less than a 2-weeks supply – 1.7 weeks of inventory, to be exact. It doesn’t get much better for homes priced from $300,000 to $399,999, where there is a 2.17-week supply of unsold homes. Even for homes priced at $1 million or more, there is only 6.35 months of inventory, which is a 15.6% drop from the inventory level a year ago.

November Housing Market Report

The low supply and strong demand continue to drive up home prices. The average price of a single-family home sold last month was $479,192, up 8.68% from November of last year. Rising prices resulted in a record $23.116 billion in total home sales in the first 11 months of the year. That is $886 million more than all the homes sold last year, which was a record year for home sales dollar volume.

November Housing Market Report

Colorado Real Estate News

Inventory Hits Record Low In October

The most frightening part of October could have quite possibly been the lack of inventory. The Denver Metro Association of Realtors reported a mere 6,312 actively listed single-family homes and condos on the market last month, an all-time low for an October. The active inventory was down 16.79% from September. While there is always a month-to-month drop this time of the year, last month marked a 49% larger percentage drop from September to October than in 2016.

On a year-over-year basis, the active inventory fell 6.22%, which was more in line with the 5.94% drop experienced during the same period last year. Fewer new listings hit the market last month, too. The 4,724 new listings marked a 19.2% drop from the 5,847 added to the market in September and a 3% drop from the number of new listings a year earlier.

The lack of inventory is not only frustrating for buyers, but it also is pushing up the prices of homes. The average price of all homes sold last month was $443,873, a 3.9% increase from September and an 11.85% jump from October 2016, according to DMAR. One good piece of news, however, is that the 5,411 homes placed under contract last month represented a 9.5% increase from September and a 9.9% increase from October 2016. The 4,450 sales, though, were down 9.75% and 7.9%, respectively, from September and a year earlier.

With so few homes on the market, it was not surprising that the months of inventory dropped. October ended with only 1.49-months of inventory, which is slightly less than 6.5 weeks. That is a 12.35% drop from the MOI in October 2016. The market was especially tight in the price band from $200,000 to just under $400,000, with less than a month’s supply available in October. The months of inventory, as it always is, was highest for homes priced at $1 million or more. There is a 6-month supply of homes in that price range, which is a 38.4% drop in the months of inventory in that category a year ago.

Interestingly, the luxury market is the one that arguably is the most balanced between buyers and sellers. Luxury homes, in fact, set a record for sales in an October last month. There were 158 homes priced at more than $1 million that traded hands last month, a 49% year-over-year jump and a 32.8% increase from September, DMAR’s statistics show. As we head into the holiday season, which will likely bring the normal, seasonal slowdown, the Denver market remains a strong seller’s market.

Colorado Real Estate News

Denver Real Estate Market Experiences a Build-Up Of Inventory

September Market Stats 2017In September, Denver-area home sales slowed more than the typical seasonal slowdown. This may be a sign that if you want to close the sale of your home by the end of the year, you will need to make some adjustments.

There were 4,427 total home sales in September, an unusually large 21.6% drop from August and a 15.6% drop from September 2016, according to data from the Denver Metro Association of Realtors. By comparison, September 2016 showed a more typical, seasonal drop of 11% and 5.5% from the previous August and September 2015, respectively. Home sales showed big month-to-month drops across the board. The biggest price band drop was for single-family homes priced at $1 million or more, which experienced a 25.38% slowdown from August. “September activity in the single-family luxury market fell like the autumn temperatures resulting in a buildup of inventory,” according to Jill Schafer, Kentwood Real Estate broker and a member of the DMAR Market Trends Committee.

At the same time, luxury homes fared very well when compared to a year earlier. The sales of the most expensive homes soared 24.36% last month from September 2016. And homes priced from $750,000 to $999,999, showed the largest year-over-year, increase of any price band, jumping by 31.24%. On a month-to-month basis, single-family priced from $500,000 to just under $750,000, showed the second largest slowdown, with sales falling 24.34% from August.  In fact, on a month-to-month comparison, the only price range that showed an increase was for single-family homes priced between $100,000 to $199,999. While homes in that price range jumped 18%, only 26 homes traded hands, as there are few homes available priced below $200,000.

If you are house-hunting, now is a great time to consider buying a condominium or town-home. There were 1,893 attached homes on the market in September, a 9.68% increase from August and a whopping 19.96% jump from September 2016. The average sold price of a condo last month was $313,096, almost $163,000 less than the $429,597 average price of a single-family home sold in September. The sale price of both condos and single-family homes were down slightly from August, but were up 8.5% for single-family homes and up 9.6% for condos. Despite the slowing sales, there was only a 1.8-month supply of single-family homes on the market last month and a 1.5-month supply of condos. A market balanced between buyers and sellers has 5-to-7 months of inventory, so Denver is still a strong seller’s market.

Regardless of the slowdown last month, the year still is slightly ahead of where it was in 2016. In the first three quarters of this year, there have been 43,558 total closings, for a record sales volume of $18.85 billion. In terms of year-to-date sales, the market is 3.22% ahead of where it was last year. In terms of dollar volume, the market is 11.82% ahead of where it was this time last year.

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Home Sales in the Denver-Area Show Typical Seasonal Slowdown

Denver August Home SalesEvery market has a season. The Denver housing market is no different. In August, home sales in the Denver area showed a typical seasonal slowdown. With a market as hot as Denver, any cooling can seem like a bigger deal than it is. There were 5,324 single-family and condo/townhome sales in August, a 5.8% drop from July, according to the most recent report by the Denver Metro Association of Realtors. That is fairly typical month-over-month drop this time of the year and is a long way from a meltdown.

Home sales did fall 8.6% from August 2016. However, if you dig into the last year’s statistics, the year-over-year drop this year isn’t surprising. That’s because in August 2016, sales bucked the normal trend and actually rose a bit from July. Also notable is that the average price of all homes sold last month stood at $434,478. That is a 2.75% dip from July, but a record for August. August 2016, in fact, was the first August on record where the average price of all homes sold topped $400,000.

By the numbers, all home prices are up 8.17% from August 2016. And that’s a time when the inflation rate remains below 2%. Another way to look at is that home prices have been rising at 4 times the inflation rates. The good news is, the average price of a single-family home was $483,574, a record for an August, but down 2.21% from July. The average price of a home likely will not top $500,000, a milestone that seemed likely earlier this year.

There were 7,360 homes on the market last month, basically flat from July and up less than a half percent from a year earlier. August of last year marked the lowest inventory of any August on record and last month didn’t give house hunters many more homes to choose from.

What is interesting is that the active inventory of attached homes, mostly townhomes, surged in August. There were 1,726 attached homes on the market last month, a 4.7% increase from July and a whopping 17.2% from July 2016. So, if you want to buy a townhome you have many more choices than a year ago. The single-family inventory of 5,634 homes, dropped 1.2% from July and 3.76% from August 2016. By contrast, the inventory of single-family homes fell 1.21% from July and was down 3.76% from August of last year.