So, How’s the Market, September 2015
All data taken from REColorado on September 12, 2015. Denver, Colorado.
Inventory Increasing, Sold Data Decreasing. What Does This Mean for Residential Real Estate in Denver?
- Listing Inventory is 2% more today than one month ago.
- The number of properties sold YTD in 2015 over 2014 has increased 2.9% due to the brisk spring time sales Denver real estate experienced.
- The average price of a home in August of 2015 has decreased 1% over July of 2015.
- August 2015 average price over August 2014 is up 11%.
- Average Days on the Market is increasing, but still very attractive historically.
- The percent to list price remains at a very strong number with homes getting full price or above in the majority of sales.
What Does this Mean for Denver Real Estate?
- The slowing down of the housing sold data is a result of three factors:
- The Buyer Pool or wave of buyers is slowing down due to seasonality and lack of affordable inventory meaning the average sold price of a home at $363,625 has hit a level buyers are not as eager to move forward.
- Buyers income has not kept pace with housing appreciation.
- Lack of inventory in areas causes current homeowners to hold off from selling as they may not be able to replace their existing home with what they want.
- The number of sales for 2015 will be approximately the same as 2014 or about 57,000 single family and condo’s closed for the year.
- Fewer Buyers entering the buyer pool will cause prices to stabilize.
- Sellers have gotten a little too aggressive on price and terms for the market, hence the inventory is starting tor rise.
- Different Price Points and Different Locations react differently in the Denver market. Understanding your neighborhood with accurate supply and demand sales will give homeowners a better picture for your specific home.
Compare Denver with Douglas County
Take a look at the two market statistics from Douglas County and Denver County, when for the past 7 years Denver has been a hotter market than any other county. The truth is for today, Douglas County is now outperforming the urban corridor in many categories when evaluating real estate. Here’s why:
- Inventory in Douglas County is decreasing faster than Denver County and as inventory rises, sales slow down.
- Douglas County is starting to offer an array of more affordable housing and is trending to a younger average buyer wanting a newer and larger product vs. what Denver housing affords.
- The affordability of a home is based upon average price, interest rates and average income per person. In Douglas County, the average income is rising faster than Denver making homes more affordable, even though the average price is higher.
These are just a few reasons the suburban market is finally starting to outperform the urban market for the first time in 7 years. There are many factors to consider as well, if you are considering an area to move to over the next year. To compare your home with other areas, call your Denver 100 broker for complete market comparisons and data.
What Should Sellers Be Doing to Take Advantage of the Market?
- Price still dictates buyer behavior. If you want to close before the end of the year, price your home at or 1% below current market values to capture more buyers.
- Make your home a move in-conditioned property. Buyers are unwilling to buy fixer uppers at top dollar.
- Consider prepaying for HOA fees or other concessions for buyers to differentiate your home from others when marketing.
What Should Buyers Be Doing to Take Advantage of the Market?
- Leverage your purchase with the lower rates now versus waiting even into 2016.
- Investors look at the entire Denver market as one of the best to own real estate. We encourage buyers to consider buying now versus waiting for both a primary residence and/or investment property.
- If time permits, do a pre-inspection before buying. This will give you enough data to make an informed offer on your purchase, that gives the seller enough information to accept a more favorable price to you, as the buyer.
Good Selling and Buying!