By Dr Denver H. Bubble
The cracks continue to appear in the metro Denver residential real estate market. Active inventory was up almost 3% month over month in July. While not as high as the double-digit increase in May and June, it is still trending in the right direction to put downward pressure on prices. Buyers are also beginning to throw in the towel regarding high prices. Sold homes were down almost 16% month over month in the busy summer season. This is translating into falling prices for both median and average selling prices. Median prices in the metro Denver area were down 0.6% month over month to $417,500. Average prices in the metro Denver area were down almost 2% month over month to $479,802. In addition, the important days on market statistic increased by almost 5% to 20 days showing that inventory is sitting for longer.
Steve Danyliw, Chairman of the DMAR Market Trends Committee, said, “it is not the time to panic, but this market is showing signs of cooling, and realtors need to manage seller’s expectation as market conditions change. Both average and median prices have dropped from June. With inventory at a three-year high, the climate is perfect for slowing activity and price reductions as fewer and fewer homes are considered affordable.” We have to disagree; this is the time to ring the bell at the top of the market. If you are looking to sell, sell soon as prices will continue the downward trends of July, especially in the light of higher and higher interest rates. We forecast prices to continuing to drop.
Data source: DMAR