The Market

Numbers to know.

Denver Home Sales are Up, as Housing Inventory Grows

Denver Real Estate Market Snapshot - May 2019

Last month we watched housing prices jump above $500k, just as they did for the first time in April 2018. Yet, even though prices are still sky-high, we’re living in a market that is stronger than last year and also friendlier to both buyers and sellers. How so?

Buyers are benefitting from lower interest rates (down .5 percentage points from last May), more housing inventory (36% more homes for sale), and a smidge more time (roughly half a week more) to see properties before they’re snatched up. 

Sellers are benefitting from — wait for it — prices staying high.

Excluding a national event that would radically change the housing market, the demand to live in Denver continues to keep housing prices high. The U.S. Census reported Denver among America’s top 10 cities in overall population growth between 2017-18, with an increase of 1.5%.  

 

Denver Home Prices Continue to Rise, but Market Softening Ever-so-slightly

Denver Real Estate Market Snapshot - April 2019

For the first time since May of last year, the median sales price for detached single family homes is back above $500,000. The median price this April, however, is 1.2% lower than April of 2018. Months of inventory rising 50% higher in April 2019 compared to last April, means that homes are taking longer to sell. With a lower interest rate and higher inventory, Denver buyers are feeling a little less pressure compared to last April. Last May, Denver experienced the highest median sales price of all time, and May of 2018 was also the second highest month in sales last year. Year-over-year prices and sales volume are lower than 2018, but month-to-month sales and prices are rising steadily in 2019. Regardless of the slighter softness in the market this year compared to last April, it is safe to say we’re in for a very active market this month.

Just when we thought the Denver real estate market was cooling…

2018 was without a doubt an explosive year for Denver’s residential real estate market. As the dust settles (figuratively, not literally), here at Love Your Hood we’re bringing to light the market conditions affecting current and future Denver homeowners.

Interest Rates Falling

Interest continue to fall this quarter, as they have since reaching a 2018 high in October last year. Falling mortgage rates mean more buying power. In Denver, lower borrowing rates along with other factors have driven the price of both attached and detached homes up consistently over the past three months.

Home Prices Starting Another Climb?

Jumping into sales price; the above graph visualizes the end of a brief lull in Denver home prices in the final quarter of last year. The final patches of snow are melting away, the flowers are in bloom and Denver’s real estate market is heating up too! After last year’s record-setting summer prices eased off largely in part to growth of Denver County’s inventory. Now, Denver is experiencing the opposite–Dropping inventory and rising median home prices. Will median housing prices reach the rates they did last summer?

Housing Inventory Retreating Once Again

Denver’s supply of inventory grew slowly but surely from last July to a nearly 2.75 months this February (the most inventory Denver county has on record since October of 2013!!) Median home prices dropped over that time as inventory rose. The above graph shows the last year of inventory with a sharp drop off after February. Compared to last year, though, inventory in Denver County is high…

More Inventory in Denver, Yet Less Homes Sold

If the cranes dominating the Denver skyline and the orange construction cones guiding you to work every day could be quantified on a graph: this would be it. The above graph shows inventory and sales over the past month compared to last March. Across the geographic area represented above, there is one bar that dominates the graph: active listings in Denver County. With a significant bump in available housing going into Spring of 2019, homebuyers will have a multitude of housing options. It’s even possible median home prices will soften this year compared to last.

Rising Inventory Not Enough to Slow Denver Housing Price Climb

Denver Real Estate Market Snapshot - November 2018

November home prices fell from the previous month, but still showed an increase of 7% from a year ago. The median November price of $465,588 is just shy of the yearly median home price. The bigger point to notice is the increase in housing inventory. While we’re still solidly in a sellers market, with 2.2 months of housing inventory (a 57% increase over this time last year), we’re steadily moving towards a more neutral market. It would be hard to not attribute some of this to the rising mortgage rates in a market that is continually becoming less affordable. 

Are Denver Home Prices Starting another Climb?

Denver Real Estate Market Snapshot - October 2018

Interest rates continue to rise, and September’s brief lull in rising median home prices and sales has disappeared. Prices in October have reached a quarterly high. While inventory is up over last year it is down from the past month. Buyers expecting to gain some leverage in what appeared to be a home market about to recede might have to readjust their budgets. Some of us may be letting out a sigh of relief that average prices are below the $500,000+ mark we reached this spring. However, October is a reminder that we still live in one of the most competitive real estate markets in the country.

Are signs pointing to a cooling market?

 

Denver Real Estate Market Snapshot - September 2018

All “statistical” signs are pointing to a slowing housing market, with one exception. From the snapshot above one things sticks out pretty clearly: median prices are up. Lets dive into things and see what’s driving our real estate market.

INTEREST RATES

If you’ve been following the Federal Reserve or listening to the news it shouldn’t be a big surprise to hear that rates are creeping up. Since July they increased by .13% (and .82% since Sept of 2017). If you are timing rates, now is the time to lock. If you wait, it will most likely cost you!

 

Now for a little more context… we’ve been really spoiled over the last five years with sub 4.5% rates! Just like when you are at an epic party — it has to end sometime, right?!

Ok, now we have it dialed way back to 1972. We are still in historically low territory compared to the last four decades. Just ask anyone that bought a home in the early 1980’s what they think of today’s rates. #perspective
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Interest Rates Going Up, Denver Home Prices Coming Down

Denver Real Estate Market Snapshot - June 2018

Interest rates continued climbing throughout the second quarter, while median home prices started a two month decline. The struggle to find a home for the average buyer is still very real, there are some emerging trends worth keeping an eye on. Is the market changing or is it an early seasonal correction?

INTEREST RATES

Does the chart below remind you of the elevation gain during your last run? 2018’s interest rates started out at 3.9% and are currently at 4.57%. Most experts predict continued increases for the remainder of 2018. If you are currently under contract, a conversation with your lender to lock your rate should be priority number one.

The last time interest rates were at the 4.5% mark was in December of 2013. For those financing their purchase, increasing rates decrease buying power. For those on a budget, that means lowering your max price to accommodate the extra interest in your payment. (more…)

Rising Rates Not Slowing Buyer Demand for Homes in Denver

Denver Real Estate Market Snapshot - May 2018
Rising interest rates along with the Federal Reserves recent rate hike announcements should help cool Denver’s crazy housing market, right? In reality it’s actually tightening it up a bit. Buyers are starting to feel pressure on their budget not just from rising home prices but now increasing interest rates are reducing their buying power. Month’s of inventory keeps decreasing as consumption keeps increasing. We suppose the old saying, “get em’ while they’re hot!” applies this summer.

$512,250!?! Denver Home Prices Reaching New Highs

Denver Real Estate Market Snapshot - April 2018

$512,250!?! Yes, that’s exactly how we said it when we saw the median prices for single-family, detached homes. We surely thought it was a mistake in our computations, but just like Santa we checked it twice. Home prices have been climbing a proverbial 14er since January, where they’re up a whopping 15.1% from this time a year ago. Interest rates are trending up, but buyer demand is still strong with inventory trickling down to 1.2 months. The length of time it’s taking homes to sell took a dramatic dive down to 20 days, almost a week shorter than the previous month. 88 more homes sold in April compared with March, indicating demand is just waiting for new inventory to hit the market.

Some Much Needed Relief for Denver Renters

Some good news for Denver renters — the rental market appears to be cooling down a little bit! As we head into our peak rental season expect rental rates to remain close to the same or increase ever so slightly. The exception to this will be sought after, hot neighborhoods where people are willing to pay a premium for high walkability.

Denver, Colorado Rental Rates Q1 2018

Denver two year look back for median rental rates.

The first quarter started out relatively flat compared to the sharp increase seen at the beginning of 2017. New apartments have steadily been hitting the Denver market, helping to slow the rent increases we’ve been accustomed to. As we get into prime leasing season (May – August) we would expect to see a very slight increase for three and four bedroom units, since new units of this size aren’t being built as frequently as their smaller counterparts. One and two bedroom rent will likely remain flat and could even show a small drop due to the new inventory hitting the market each month.

Denver Median Rental Rates by Bedroom Q1 2018

Median Denver Metro Area Rents ($)

As we look at median rental rates around the metro area, one neighborhood that sticks out is Union Station (LoDo). Why? The 1 year change was -0.9%, mainly due to the increased competition from new rental units hitting the market. The 5-year change was only 1.7% — proof that added density and inventory is what Denver needs to curb rising rents.

View map in larger screen here.

Note: Think of this map as a 30,000 feet view of the rental prices in Denver. You can click on each neighborhood for exact numbers and year-over-year statistics.
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