I’m waiting in the airport in Orlando after the week-long National Association of Realtors conference, and I’m ready to get back to Denver and to selling Denver real estate.
Of the many things I’ve learned while I was here, one is how many real estate brokers feel that Denver’s market is preferable to theirs. Many times, when I introduced myself, I heard, “Oh, I wish I was selling there.” The perception is that Denver’s real estate market is beginning to build up strength ahead of many other U.S. cities.
As I’ve said in past articles, our low to mid-range homes are selling most quickly now. It’s becoming very evident that when affordability aligns with buyers’ earnings and qualification potential, then buyers will re-enter the market.
Looking at the chart from Denver’s MLS, Metrolist, you’ll see that average sold price is down over 12% from this time last year. This is a result of lower end homes selling better than high end homes. It’s also a reflection that affordability is improving. Homes’ affordability, combined with decent mortgage rates, is driving many buyers off the fence.
We also have 20% fewer homes on the market from last year in October. This is more informative than looking at the 3.36% reduction since last month. Why? There is most likely a seasonal factor informing the number from last month. Sellers are not putting their homes on the market this time of year, and so we typically see a decline during the 4th quarter. However, the huge 20% decline since last year is very good news. We’ll probably see more pent up demand from buyers as there are fewer homes to choose from.
We’ll also begin seeing the days a home is on the market shrinking. You can already see a slight decline of just over 1% for single family and condo properties combined.
There is a collective holding of the breath to see where we go from here. The U.S. recession could become intractable in coming months, and this could well affect Denver’s nascent recovery. However, we have strong employment, a diverse economy, and a fabulous lifestyle in our corner.
September 2008 Market Stats available here.
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