According to the monthly Denver Metro Association of Realtors (DMAR) Market Trends Report, the number of residential home sales dropped 5.79% in August compared to July. The drop was even more significant–8.58%—when compared to last year at this time.
Similarly, the average and median sold prices dropped 2.75% and 1.30% respectively in August compared to July (although both numbers increased more than 8% over last year). The average home price in August was $434,478.
The decrease in sales and prices has led some to question if the metro area is in a housing bubble that will soon burst. But Steve Danyliw, chairman of the DMAR Market Trends Committee, deflects such concerns.
“Overall, I still feel positive about this market even though we are transitioning towards something that looks more normal,” he writes in the DMAR monthly report. “…Over the last two months, I’ve personally spoken to dozens of REALTORS and asked them a simple question: ‘Is the housing market turning?’ Over 95 percent responded with a quick YES. One responded, ‘The feeding frenzy has lessened.’” Still, he writes, “no one believes a bubble is in our near future and I agree…we’re slowly returning to normalcy.”
While some feel the market will continue to cool, The DMAR report notes that “many agents feel the slowdown is purely seasonal…”
Whatever the cause, the latest market figures will be welcome news for buyers, who have faced a challenging time purchasing homes in the past several years. DMAR reports that with this recent cooling of the market:
• “…sellers are more receptive to contracts that are contingent on the sale of another property.”
• “…price reductions at all price points are on the rise.”
• “…buyers are starting to negotiate, which is resulting in sellers becoming more realistic with their pricing.”
• “…buyers appear to be taking more time to make sure they are choosing a good home and negotiating a little harder.”
In sum, the market is becoming more friendly to those interested in purchasing a home.