By Dr Denver H. Bubble
Happy Fourth of July everyone, the Denver housing market much like tonight’s fireworks looks like it is beginning to burst. Month over month, prices in the Denver Metro area decreased, falling 0.54% for median and 0.47% for average residential prices. Single-family homes sold prices dropped to $547,461. Year over year, the pace of the housing prices increase rose as well with the average residential prices rising 1.57% and the median residential prices up 1.9% from June 2018 to June 2019. Jill Schafer, Chair of the DMAR Market Trends Committee, said, “The overall close-price-to-list price ratio year to date was 99.41%. Sellers were getting, on average, more than the asking price at this point in the past four years.” So pricing pressure is being felt on the sellers at the close of the midpoint of the year. A good sign for home buyers looking to get better value for homes.
There is still a lot of demographic pressure in the Denver metro area. Confirming what everybody who drives I-25 in rush hours knows a lot of people have been moving to Colorado. Colorado’s 2018 net migration increased 51,127 over 2017, according to Auction.com.
As we highlighted in our last post about May’s DMAR, there were changes in the reported numbers published by the group with no explanation. Last year’s June 2018 numbers changed between reports as well. In June’s DMAR report, Jun 2018 median single-family sales price was reported at $451,500. In July’s DMAR report, Jun 2018 median single-family sales price was reported at $455,000. We still have not heard anything back from the group when we brought the discrepancies to their attention via our Twitter account.
Housing inventory is up 7.07% to 9,520 from May to June. However, if we look at the year over year inventory statistics, inventory is also way up at a healthy 28.03%. The 9,520 homes available were still far below the historical norm of 16,577, showing the marketing inventory is still tight relative to Denver's history. Overall there are only about 1.5 months of housing inventory in the metro Denver market. A healthy market usually has about six months of inventory. Only the over $1 million housing has a sufficient supply at 5.16 months of inventory for single-family. Jill Schafer said, “We ended the first half of year with the most active listings (9,520), we’ve had since October of 2013 when there were 9,734. That’s up 28.03% year to date from 2018.”
Sold homes were down almost 14% year over year as well as month over month. June is the last month of the busy spring selling season, and it appears weaker than last year.
Ms. Shcfer also said, “With interest rates staying low and inventory going up, it is really a perfect time to buy. Prices may be high but are leveling off so it’s a great time to sell, too. In my opinion, this market is just right for everyone. “ While we were expecting prices to soften in the second half of 2019, if the ever bullish realtors are claiming we are at a market equilibrium, this may be time to ring the bell at the top of the market. Stay safe and enjoy the show tonight and please share us on Facebook and Twitter, or even YouTube to help your friends and family make the right decision about their real estate transactions in the metro Denver area.