As we head into the summer months, it's helpful to focus on the three P's to find equilibrium in the Denver Metro real estate market -patience, preparation and persistence, says the Denver Metro Association of Realtors’ Market Trends Committee.
Patience while navigating this changing market is the first key to finding success. Sellers who prepare their properties to compete on the market will find themselves a purchaser more quickly. For buyers, persistence will pay off once they find the right property.
As we patiently wait for mortgage rates to adjust downward, we continue to find a way to transact business in this landscape of seven percent interest rates. Last month, new listings rose 16.51 percent month-over-month and 33.88 percent year-over-year to 6,966. Pending sales increased a slight 1.94 percent month-over-month with 4,265 properties, while closed sales rose 5.72 percent to 4,198. Median close prices fell marginally month-over-month by 0.41 percent.
The most notable gain this month was in active listings at month end, which rose 31.03 percent month-over-month, 75.19 percent year-over-year and, most astonishing, 150.79 percent from this same time in 2022. It was widely projected that inventory would remain flat throughout 2024, as long as there wasn't a huge drop in mortgage rates. It was forecasted that homeowners would favor their low mortgage payments due to sub-four percent interest rates available during the pandemic years, then enter the market to sell their homes. Additionally, it was predicted that sellers who would enter the market would be motivated by major life changes and were in the "need to move" category. However, that doesn't seem to be the case, as sellers have been not only stepping but jumping off the fence to enter the market for a variety of reasons.
This is why it's so important for sellers to take the time to prepare their homes for the market. Those who take their Realtor's® advice have found themselves moving to the closing table more quickly than their neighbors who have not put the time and energy into getting their homes ready to list.
Opportunities do exist in the Denver market for persistent buyers. The months of inventory has grown to 2.18 market -wide, a 16.58 percent increase month-over-month. Buyers have the immense gift of choice and now have more properties to consider before submitting an offer. Additionally, consumers have become accustomed to transacting real estate quickly throughout the last few years. As a result, sellers are more willing to evaluate a price correction or negotiate with buyers at the onset for a quick sale.
Additional opportunities continue to present themselves in the condo market. These properties experienced a three-pronged financial hit over the last year due to rising HOA fees, association assessments and property taxes. Homeowners in the condo market are paying more to hold onto their properties. As a result, by and large, they are not appreciating as well as they once did due to buyer hesitancy to take on the financial burden. This has resulted in a median close price of $407,250, a 2.8 percent decrease month-over-month and a 4.18 decline year-over-year. Median days in the MLS have also increased 16.67 percent month-over-month to 14 days, an astounding 133.33 percent increase year-over-year.
The motivation to enter the market is varied. However, over the past week alone, I've encountered more buyers and sellers who are transacting real estate to take advantage of 1031 Exchange opportunities. These savvy consumers know that real estate is a sound investment, especially when focusing on patience, preparation and persistence.
Read below for a price range breakdown for properties sold between $500,000 and $749,999 from Market Trends Committee Member and West + Main Homes Agent, Michelle Schwinghammer.
Governor Polis approved a bipartisan bill that will cut property taxes, saving the average homeowner $500 and capping future tax increases at 5.5 percent.
Mayor Mike Johnston announced a plan to raise $500 million in public funds to revitalize downtown Denver over the next 10 years.
Overall office vacancy rate in downtown Denver rose to 32 percent in the first three months of 2024, the highest in decades. However, offices around Union Station and LoDo are faring better, with vacancy rates in the single digits.
Upton Residences, with 461 condos, will be Denver's second-largest condo project once completed, following the 42-story, 496-unit Spire building that hit the market in late 2009.
Colorado homeowners report 30 to 130 percent insurance premium increases, with some being informed that their policies won't be renewed.
Learn more about the market from the Denver Metro Association of Realtors.
Thank you to our partners at the Denver Metro Association of Realtors for compiling this information.
If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.
