Buyers and sellers who attempt to time the market perfectly may find the balancing act as frustrating as timing a trip to the mountains to see the peak of the aspens changing color this fall, according to the Denver Metro Association of Realtors’ Market Trends Committee.
While the Federal Reserve Bank lowered rates by 0.50 basis points- a larger cut than many expected - buyer activity remained sluggish. The median close price dropped slightly by 2.34 percent to $576,171, down from $590,000 in August while median days in the MLS increased 19.05 percent to 25 days from 21 days. New listings stayed relatively unchanged with 5,053 while pending sales increased by 3.64 percent to 3,761. Active listings at month end grew slightly by 3.65 percent month-over-month, a staggering 45.69 percent increase year-over-year.
The most notable stat that we want to highlight is how months of inventory have steadily climbed since last June when we started tracking this data point market-wide. For reference, our June 2023 report showcased that the month of May had 1.25 months of inventory. In September, months of inventory increased to 3.6 months. This represents the first time months of inventory have crossed the three-month mark, meaning it takes an average of 3.6 months to find a buyer, which traditionally has been categorized as a balanced market. This is a far cry from a pandemic-fueled market which had less than one month of inventory.
Homes are simply spending more time on the market and experiencing more price reductions before finding a buyer. This is a direct result of buyer demand waning due to higher interest rates and, to some degree, anticipation for the upcoming Presidential election. Many buyers who I am working with are simply waiting for truly the perfect fit, before submitting an offer. They aren't willing to make compromises on a home they have to pay more for due to higher interest rates. When they do find the right home, even if a home is new to the market, they are eager to negotiate.
Sellers need to understand that it's simply taking longer for homes to sell. I do expect the months of inventory to continue to climb as we move closer to the election and the upcoming holiday season. Saying that, many sellers have indicated a desire to hold off listing their homes until the spring to try timing their sales a bit more strategically.
This is historically the Denver metro area's height of the selling season and the time of year when sellers experience the highest sales price all year.
If buyers are waiting for the end of the election cycle and the holidays to wrap up, they may be kicking themselves for not striking while the iron is hot. Historically, sellers have reaped the rewards as home prices tend to increase after an election cycle.
While we hope you have been able to time your trip to the mountains perfectly to see the golden glow of the aspens, the Denver real estate market continues to be an ever-changing landscape post-pandemic.
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.
