While the Denver-metro housing market slowed in August, it’s unclear if it’s a temporary event or a long-term trend.
Signs of a slowdown include a 10.91% drop in the number of sold homes, as well as a decrease in prices. The average sold price also dropped to $488,918—1.3% lower than in July (although still 3.53% higher than last year in August).
In addition, homes are staying on the market longer, at an average of 30 days. This is 15.38% more days than in July and 30.43% longer than last year in August.
“In 2019, buyers and sellers are not having the same experience their neighbors did last year,” notes Chair of the Denver Metro Association of Realtors Market Trends Committee Jill Schafer.
“In the first half of 2018, sellers were taking offers over the weekend and selecting the best one in the stock on Monday. This year, sellers are making price adjustments as they try and find the right price point to entice buyers to make an offer. Sellers also have to keep their homes picked up for longer…”
Buyers are enjoying the change, she notes, as inventory has grown and they can now look at multiple homes in one day, rather than rushing out to see homes one at a time as they slowly hit the market, as in previous years.
“They’ve even been able to do some negotiating as the close-to-list price ratio dropped to 99.36% year to date compared to above 100% at this point in the past few years.”
Nonetheless, Shafer adds, sellers are still reaping more reward from sales than last year.
Schafer notes that it’s uncertain how the market will behave going forward, but currently, there are advantages for both buyers and sellers. “[F]or now both buyers and sellers should enjoy the balance,” she notes.
Other tidbits from the market report:
- A National Association of Home Builders’ poll found that only 12% of adults are considering buying a home in the next 12 months. This is the third year of decline in the share of adults pondering a home purchase, “providing further evidence of a slowdown in the housing market as potential buyers are held back by the lowest levels of affordability in a decade,” notes the report.
- About half of Denver households can afford an existing entry-level home with a 5% down payment.
- Home prices rose 2.10% year-over-year in the nation’s 20 major markets, according to the S&P National Index, while Denver’s prices rose at a higher clip: 3.4%.
- Inspections are increasingly affecting home sales, “with some Title Companies reporting up to 33% of contracts failing due to inspections.”