This year's seasonal summer slowdown isn't quite as dramatic as in years past, but we are starting to see a shift from the frenzied activity experienced over the last several months in the Denver real estate market. For buyers, it provides some needed relief from stiff competition, flash sales, and limited options. For sellers, it means that it's more important than ever to price your home right. Pushing the price during the latter half of the year could cost you showings, time on market, and money left on the table. Let's take a closer look at what July's numbers are telling us.
Quick Stats
Yearly appreciation is still in the double digits for both attached and detached homes, and days on market is holding steady at a fast 4 days. The odds of selling however, which tracks the likelihood of going under contract or closing within 30 days, is down 10% (although still higher than it ever was pre-Covid). July is typically when we start to see more price reductions due to a shift in supply and demand caused by increased inventory coupled with buyer distraction. This July, 10% of closed homes required a price reduction to get under contract, compared to 25% last July. So while we are experiencing a shift, we're still tracking below market norms, keeping us in an extreme seller's market.
Inventory Bump
Buyers attempting to take advantage of favorable interest rates have had a tough time finding and securing a home in the hyper competitive, low inventory Denver real estate market. Each month the listing supply seems to dwindle, hovering at historic lows. July's numbers showed promise however, with a 30% bounce back of inventory from the previous month (the largest jump ever recorded in July). This takes some pressure off of our strained housing market, but is still 37% lower than last July. We're still a long way from healthy inventory levels.
Buyer Opportunities in a Seller's Market
Even though the Denver real estate market stillfavors the seller, there areplenty of perks for buyers right now. The cost to borrow money remains low which increases the amount you can afford to spend on your new home. An added bonus of home shopping at the end of the summer is that other buyers are busy with summer vacations and back to school hustle. Rising inventory and distracted competition means more options for dedicated home seekers.
The Cost of Waiting
If you've been waiting to enter the real estate market, the stars have finally aligned for you. Rental prices are going up, interest rates are in the basement, inventory is higher than it's been all year, and we should see a retraction of home prices in the latter half of the year. All signs point to homeownership! Hesitate however, and your dream home could be out of reach by next summer. The chart below shows the impact of interest rates and rising home prices on your bottom line.
The softening of the market in July is providing some breathing room for buyers which should continue throughout the latter half of the year. Check back next month to discover what the August numbers reveal about our changing market.
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