It’s election season and an incredibly contentious time in the United States. We are cautious to arrive at any conclusions about the direction of the Denver real estate market with the number of social variables at play. Are buyers and sellers waiting for things to calm down following the presidential election? What policies will be implemented about public health and how will they affect our economy? How will the stock market and interest rates respond?
Many of these are a wait and see, so we are particularly judicious in limiting projections and are instead sharing facts. As we see any lead indicators for market change, good or bad, we’ll let you know.
New Homes and Under Contracts
With 1,246 homes going under contract and only 997 homes hitting the market last week, the total Denver area inventory shrinks to just over 4,000 homes available for sale (all property types) with just over 2,000 single family homes.
More Activity, Not Fewer Homes
Yet, year to date Denver has set records for volume in both the number of properties sold and under contract. Through November 5th, 2020, 48,808 homes sold compared to 46,777 at the same time last year. 52,463 homes have gone under contract versus 48,655 in 2019.
But, what’s telling is the total number of new listings year to date. It isn’t that fewer people are selling their homes, thereby driving inventory down. There are simply more buyers than ever, driving prices up. 2017 through 2019 averaged 58,158 homes listed for sale through November 5th. Year to date 2020, we are actually above that number at 58,444.
And like it or not, Denvers’ net population gain continues. The migration of people from around the country to places like Dallas, Austin and Denver (to name just a few) due to attractive lifestyles and strong local job markets and diversified economies are strong indicators for continued buyer activity.
Prices Remain Elevated
The average weekly sales price of a single-family home in Denver was $621,878 last week, with 3 out of the last 4 weeks over $620,000. This compared to $534,184 at the same time as last year and dipping below $500,000 the second week of October last year at $498,141.
The trend is almost identical for all residential property types (condos, townhomes, etc.), hitting over $550,000 for 3 out of the last 4 weeks this year.
Showings Compared to Last Year
For the first time since shelter-in-place, the total number of showings has slowed to last year’s levels at 19,102 showings last week compared to 18,826 same week last year.
However, it was an election week last week and there was a precipitous drop in showings from the last 6 months averages. The last 4 weeks alone has averaged closer to 25,000 per week. We’ll keep a close eye on this one to see if this is a shift in the market or the expected reaction to a significant week in the United States.
Buyer activity remains strong, though we will watch activity in reaction to the election season. Days on market for listings is about ½ of what it was this time last year, prices are up year to date markedly, and inventory is very, very low.
>>> If you are a seller, while the holiday season isn’t normally a great time to put your home on the market, circumstances are unique this year. Pending public health considerations and family needs/circumstances, it may be worth considering selling sooner than later.
>>> As a buyer, there is normally less competition this time of year. This may mean greater ability to negotiate favorable terms if you remain active in the market while others choose to hit the pause button through the holidays. Capitalize on extremely low interest rates and potentially softer competition.