The Market

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Denver Real Estate Market 2017 Recap

Denver Real Estate Market Update - 2017 Year-in-review

Let’s rewind, take a stroll down memory lane, and sift through 2017’s housing data…

Days on the Market and Inventory

The new year is here, but it forgot to bring new homes for sale along with it! The following two charts go hand in hand and help influence the median sale price. Notice any similarities? As buyer demand increases and the average days on the market decreases, inventory usually drops with it.

Dial back to 2012 and you can see we were in a neutral market and average days on the market were in the upper 60’s. Fast forward to the end of 2017 with inventory for detached, single-family homes at literally the all-time low. December saw a mere 800 detached and 839 attached homes (condos, townhomes) available for sale. That leaves Denver with a puny 1.5 months of inventory; still a strong seller’s market, with average days on the market lingering in the mid 20’s.

Average Days on Market in Denver County 2007-2017

Inventory, nothing new here…

And the best real estate agent quote from the last five years goes to… “it’s a seller’s market!” Barring any domestic or global financial crisis, our inventory will remain low until Denver focuses on creating more “affordable” housing (i.e. dense condo projects). The city and state leaders need to make condo defect law reform a top priority for 2018. Stop putting bandaids on it. It’s time for a complete overhaul with both sides coming to the table to find a compromise that spurs condo development. If we can add 10-12k apartment units this year, there is absolutely no reason why we can’t increase our condo unit delivery rate to half that number by 2020.

Average Months of Housing Inventory Denver County 2007-2017

Interest Rates

Interest rates started the year at 4.2% and bottomed out slightly above 3.8% in September. We’ve seen a constant increase in the rate which has started to follow the Fed rate hikes (March, June, and December) in 2017. They have hinted at increases in 2018, so we would expect rates to continue to creep upwards as the year progresses.

30-year Fixed-rate Mortgages 2016-2017

Putting things into context, the interest rate has been flirting with historical lows for the past five years. When financing a home, it can be stressful when it comes to locking in a rate. Our advice? Rely on your lender’s experience and council… most of them know what they’re doing! Trying to time your rate lock is a lot like day trading in the stock market — sometimes you win, sometimes you lose. We also suggest taking this approach: lock in your rate and then don’t look back until you’ve been in the home for a year. Then, start keeping track of what rates are doing and if you are noticing that rates are trending below your current rate, call your lender and start the refinance discussion to see if it saves you $$$!

30-year Fixed-rate Mortgages 2012-2017

Now for price…

Again, no surprises here. The median sale price pretty much goes the opposite direction of average days on market and inventory. The median price for detached homes has reached whopping $435k, with attached properties coming in hot at $337k. This is an 8.8% increase of (that’s $35,000, an equivalent of roughly $165 per month on a 30-year mortgage) since this time last year and a 61% increase from five years ago.

This is an area that we need to stop setting records in and why city and state leadership must get moving on this <insert broken record comment here>. Denver must not become a city that only the wealthy can live in. Our city is struggling with the cost of housing (can we get an amen?!). Recent discussions have started on the grass roots level and we hope to see this gain momentum and put pressure on the top to make a real change.

Median Sale Price Denver County Homes 2007-2017

We’re going to land the plane with one last topic:

Amazon H2Q and Denver

You may be wondering how this has anything to do with a 2017 recap report. The famous quote credited to George Santayana states

Those who do not learn history are doomed to repeat it.

In this case, we should edit the quote to read, “Those who do not learn from Denver’s housing statistics are doomed to an unaffordable housing market.” If Denver is successful in winning the H2Q race, it will have a major impact on our housing market, cost of living, and overall economy. Seattle is the test bed for what could happen to the “winning” city Amazon selects. July’s home prices in Seattle increased by 13.5% year-over-year. For comparison Denver wasn’t that far behind, with a 9.2% increase, without Amazon! Keep in mind Amazon is bringing 50,000 high paid workers who will need to either rent or buy a house, so we would expect that number to reach or exceed Seattle’s numbers. We could go on, but you get the point. It’s definitely worth a conversation before we change Denver forever.

Denver Real Estate’s Seasonal Slowdown

Denver Real Estate Market Update - November 2017

There are two words to sum up the real estate market in November: seasonal slowdown.

Proof of this seasonal slowdown is in the amount of homes that were available for buyers to choose from, the average days that these homes stayed on the market, and the median price of a detached, single-family home.

Inventory was at an all time low, which is nothing new here! With only 1,427 homes listed in November, we had 1.3 months of inventory available in Denver. The average time that these homes stayed on the market was 30 days (in October it was 27).

Average Months Housing Inventory Denver County November 2016-2017

And let’s talk about prices. The median sales price for a detached, single-family home was $438,500, a $7,450 decrease from October. Although, that’s a welcomed breather from the continual price climb, it’s hardly enough to move the median price to a more affordable level.

Median Sale Price Denver Colorado Real Estate November 2016-2017

Usually the narrative about low inventory revolves around how quickly and how much over list price these homes sell, but this past month was a little different. Yes, we did see some awesome homes go quickly and over list price with multiple offers, but we also experienced our buyers not willing to pull the trigger on a home as quickly. Why? Because they just didn’t have many homes to compare them to. And since these homes stayed on the market longer, sellers were more willing to accept offers below the list price, which explains the decrease in median sales price.

So does this mean that Denver was in a real estate bubble after all and you should be worried about it finally bursting? We are pretty confident in saying no to that question. This seasonal slowdown is most likely just that: seasonal. And it is totally normal. We are in the busiest time of the year with all the holiday festivities of Thanksgiving, Christmas, and New Years. If this year’s seasonal slowdown is anything like last year, the market will most likely keep slowing down over the next couple of months and then pick back up around March or April.

Now, if we could just get the snow to fall a little like the real estate prices have!

A Slowdown in the Denver Real Estate Market?

Denver Real Estate Market Update - September 2017

Anyone else noticing a slowdown in the market? I bet those are words you didn’t think you’d read! But it’s true… we’re starting to see homes stay on the market longer and the median sale price is creeping down. If this fall/winter is anything like last year, then we expect the peak slowdown to happen in February. Oh, and the inventory… well, that’s low too (but that’s old news). Even though we’re seeing an uptick in homes for sale since August, we’re still under two months of inventory and holding steady in this sellers’ market.

Denver Real Estate Market Update – August 2017

Denver Real Estate Market Update - August 2017

Months of inventory dropped 5.5% year over year. Average days on the market went up 20%. The median price for single family homes are up 11.8%. Why are homes sitting longer but everything else is trending toward an even tighter seller’s market?

One word, extremes. Buyers are circling the inventory like sharks, waiting for homes to hit. Homes in desirable ‘hoods, priced well, and in great condition are gone in a matter of days — sometimes hours. If a home hits the market and is passed over during the first week, it will likely remain on the market until action is taken by the seller (price drop, improvement, enticement, etc). Some sellers are overzealous and think the market is so hot they can just toss any crazy number on the listing and they will get an offer. The savvy buyer these days will only consider homes that are hitting now and rarely go back for a second look unless there is a substantial change in the listing.

Top Denver Neighborhoods in the First Half of 2017

Denver is still in a deep seller’s market. Lack of new inventory and continued buyer demand are keeping things tight as we go into the third quarter. The only cool down coming in the second half of 2017 is fall!

Union Station - LoDo | Denver, Colorado | Love Your Hood®
Union Station (LoDo) | Denver Neighborhood with the Most Expensive Square Footage

The Most + Least Expensive Denver Neighborhoods

When compiling the most expensive and affordable Denver neighborhoods, we found it helpful to analyze the list two different ways: one based on the median sales price and the other based on price per square foot. Why? When you think Country Club, you think of large houses and decent size lots. While this neighborhood boasted the highest median sale prices in the city, it doesn’t have the highest price per square foot. Instead, if you want to know the most expensive prices per square foot of real estate, check out the second list. Think of more urban, densely populated neighborhoods for this. While these homes may not be as large, each square foot of them is more expensive.

Based on Median Sale Prices

Don’t feel bad if you are scratching your head and saying to yourself, “Auraria, really?” We did the same thing, so we dug into the numbers to see what was up. This hood only has a few housing options, all of which are loft/condo units. With only four sales in the last six months (and one of them going for $1.9 million), there isn’t enough data to give a great representation of this neighborhood. We don’t expect to see it on the list next quarter.

Most Expensive + Most Affordable Denver Neighborhoods | Q2 2017 | Love Your Hood®

Map of Median Sale Prices by Denver Neighborhood (Q2 2017)

The map below sorts neighborhoods based on their median sale price for the second quarter of 2017. It’s a great tool to use when determining neighborhoods to focus on for your home search. Clicking on an individual neighborhood will show you the median sale price for that particular neighborhood.

View map in larger screen here.


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Denver Real Estate Market Update – June 2017

Hot summer, hot market.

Curtis Park, Denver | Love Your Hood

It’s hot, there aren’t a lot of homes available (some even without air conditioning), and buyers are frustrated. Sellers are continuing to make the rules and buyers are getting left out in the heat. Sound familiar?

Home prices are breaking records and would-be sellers are more worried about their replacement purchase than selling their current home. So, they opt to wait it out. The result: no inventory, increasing home prices, and homes continuing to fly off the shelf.

Inventory, yep I said it again

Average Months Housing Inventory Denver County 2007-2017

A quick glance at this chart doesn’t reveal much. From 2016 to 2017 the inventory numbers ticked down from 1.5 to 1.4 month. Not a huge surprise if you’ve recently been shopping for a home (you already know there aren’t many options out there). What caught my eye were June’s inventory numbers compared to 2016. The active (available) number of homes for sale in June 2017 compared to June 2016 was down 7.3% while the number of sold homes for the same time period went up 3.7%. That equates to 1.3 months of inventory for June which is putting pressure on our 1.4 month average for 2017. No surprise this is pushing median sale prices to record highs. (more…)

Denver Real Estate Market Update – May 2017

Temperatures aren’t the only thing heating up right now — the May real estate market was hotter than ever. The median price for a home in Denver was $410,000 in May, nearly $7,000 more than in April and over $36,000 more compared to the same time last year. The average number of days that homes stayed on the market dropped by 5 to 19 days in May from the previous month. This means the market is doing what we know it to do in the summer — move faster and for more money. The ray of sunshine for buyers? Mortgage rates were at their lowest for the year in May, which means more buying power!

Denver Real Estate Market Update – April 2017

Denver Real Estate Market Update - April 2017

  • Properties were starting to stay on the market longer towards the beginning of the year as interest rates rose.
  • Homes are starting to move faster again as rates have declined.
  • The cool-down in prices toward the end of 2016 have all been erased.
  • Prices for condos and single-family homes have all been on the rise since the beginning of the year.

The Top Ten Denver Neighborhoods of 2016 – Second Quarter Update

Second quarter 2016 was an eventful one for Denver real estate. The Brexit gave us lower-than-ever mortgage rates and as the second quarter ended, we saw more home inventory than we have had all year. As a result, price reductions increased and it seems like buyers may have more choices and power. But not only did June give us more active and new listings, it also set the record for days on market, average and median sold price, number of homes that sold, and sold volume.

We could be on our way to a much needed market correction.

The 10 Most Expensive Denver Neighborhoods

Sun Valley, Denver, Colorado

When compiling the 10 most expensive Denver Neighborhoods, we found it valuable to include a list based on the greatest price per square foot and another based on highest median sales price. When you think Hilltop neighborhood you think of large houses and expansive lots. While this neighborhood boasted the highest median sale prices in the city, it doesn’t have the highest prices per square foot. Instead, if you want to know the most expensive prices per square foot of real estate, check out the second list. Here you’ll find properties in more densely populated neighborhoods.  While the properties may not be as large, each square foot of them is more pricey.

Based on 2nd Quarter 2016 Median Sale Prices

It’s no surprise to see the top eight neighborhoods on the most expensive neighborhoods based on median sales price list! Now we know what everyone is talking about when they say Denver is expensive! What IS a surprise is to see Sun Valley on this list. With one purchase in April (and the whole year), it made its debut but you probably won’t see it on this list again.

THE 10 MOST EXPENSIVE DENVER NEIGHBORHOODS

(Based on Median Sale Price)

Rank Neighborhood

Median Sale Price
(2016 Q2)

Price per Sq. Ft.
(2016 Q2)

1

Country Club

$1,224,348

$381

2

Hilltop

$948,013

$307

3

Cherry Creek

$823,548

$359

4

Washington Park

$795,867

$346

5

Belcaro

$741,551

$327

6

University Park

$716,278

$290

7

Cory – Merrill

$702,328

$267

8

Wellshire

$669,917

$257

9

Washington Park West

$592,622

$307

10

Sun Valley

$589,945

$307

Denver County

$375,848

$257

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