Detached active listings at month end dropped to 4,572, a 16.02 percent decrease from last month, while attached homes dropped 8.94 percent to 1,681, representing a 216.62 increase year-over-year for detached homes and a 109.08 increase year-over-year for attached homes.
While inventory increased from last year, the market is still witnessing the typical end-of-the-year inventory decrease, which is likely a result of homeowners choosing to either wait to list their homes until the New Year or remove their properties ahead of the holiday season.
Average days in the MLS increased 20 percent month-over-month to 36 days, which is exactly a 140 percent increase from this time last year. The attached market also exhibited a 20 percent increase month-over-month to 30 days, which is a 76.47 percent increase from this time last year. As the active listings count has grown, days in the MLS have has also increased since May in direct relation to interest rates. Interest rates affect a buyer's ability to afford a home, and as a result, buyers are taking more time to evaluate the value of each home, indicating that buyers are more discerning.
The average price dropped 0.58 percent month-over-month from $736,675 to $732,437. While this is a small drop, this is also a 4.17 percent increase from this time last year when the average price was $703,119. Additionally, market-wide price reductions are slowing, and close-price-to-list-price percentages dropped only 0.40 percent for attached and detached properties.
“Without a doubt, the Denver Metro housing market is changing, but the question on everyone’s mind is how long this change will last and what to expect next year,” commented Libby Levinson-Katz, Chair of the DMAR Market Trends Committee and Metro Denver Realtor®. “Most of the answers are tied directly to when we will see relief from increasing mortgage rates that have more than doubled since January. Ultimately, the spring market will be the best indicator of what the New Year will have in store for us. While we expect to see the Denver real estate market continue to change through 2023 due to interest rates and inventory woes, it has continued to show strength and stability.”
While home values are stable, the announcement of the new conforming loan limits for 2023 will aid in the affordability and accessibility for homebuyers. The baseline loan limit of $647,200 will increase to $726,200 nationwide. This sizable change will make it easier for buyers to qualify for a higher conforming loan, thus avoiding stringent jumbo loan requirements.
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 November, the Luxury Market saw a significant slowdown with only 286 new homes hitting the market. This was the biggest drop in inventory from the prior month of any price segment sector, down 34.10 percent from October. The number of luxury homes that went under contract in November decreased by 18.75 percent, and the number of closed transactions decreased 13.12 percent, month-over-month.
The most dramatic statistic for the entire market in November was the significant increase in how long a home sat on the market before going under contract. In this regard, the Luxury Market fared the best of any sector, with the median days in the MLS increasing by only 50 percent, up to 18 days for a detached luxury home and 15 for an attached one.
“The Luxury Market statistics are no real surprise as many people travel during November and interest in real estate temporarily wanes,” said Colleen Covell, DMAR Market Trends Committee member and Metro Denver Realtor®. “We need to ensure our sellers understand the “return-to-normal” in our market and set their expectations that three to four weeks before going under contract is okay.”
The most expensive luxury property to sell in the 11-county Denver Metro area in November was a modern home in Castle Rock for $6,340,000. The most expensive active listing was a 15-acre property in Cherry Hills Village, listed for $28,888,888.
West + Main agent Molly Zimmerman provided further insight on the state of the market.
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.
