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Denver Housing Market
Dated: August 8 2018
The Denver real estate market is known to have made national news for some time now with its unbelievable pos-great recession rebound. Denver’s housing market is hot and it’s well known. As compared to last year, the market is going short of housing options. The low housing supply means higher prices. A survey by the Colorado Realtor Association showed the median home price in July for Denver to be higher than the nationwide metro median. As years pass by, there are more rumors coming up saying the Denver housing market trend will come to an end.
A total of 2.6% of all homes in Denver are valued at $1million or higher which put the city among the top cities with higher home values than $1million. The Denver’s housing market is going unfair and the simple problem is that there are way more homebuyers than sellers. The market is going short of listed homes which makes it a seller market. Will coming years make any difference in Denver’s housing market? Will there be an increase in inventory to bring a more balanced market for both buyers and sellers? Will there be a rise in mortgage rates?
Denver’s availability of housing data creates a brighter picture of its housing market, but the city’s housing crisis might have taken the next level. Starting from 2012, the Denver real estate market has experienced an increase in home values to about 8 to 11% each year. Though last year experienced some growth in prices, it wasn’t up to previous years.
December 2017 started the unbalanced market for buyers by ending with the lowest number of actively listed homes as compared to any other month as far back as when the statistic was started. A normal Denver market would experience a typical December with over 6,000 to 19,000 active listed homes on the market. This short of listed homes on the market is not a unique problem to Denver but it's known to have one of the busiest real estate markets nationwide.
Though last year brought a decrease in the rising home value, there has been no doubt regarding the low inventory being the key to Denver’s price increase over the years. While we all hope for increased inventory in coming years, the current housing demand will be hardly met which will cause Denver’s metro area to have an average sales price close to the range of $450K.
One more important thing is the luxury market performance where the number of newly listed homes where priced at $1 million or higher where there was a rise of 11% and the total sale percentage increased more than 20%. Prices in other coveted neighborhoods have continued to rise 15% or higher as it is still predicted to have increased home values in the coming years. With today’s real estate market, nothing should be considered predictable.
Some questions have been asked regarding the short of listed homes on the market, is it due to builders not working up to the market standards? A record of 2017 showed that constructors of the metro area started a total of 11,958 new home constructions which is said to be 7.5% higher than 2016. That statistic is way below what builders use to go for in previous years before the market crisis.
Richard Bradley specializes in residential real estate sales and property management services. I am committed to helping homeowners, buyers & investors with their real estate needs. I spend my time in....
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