The Denver real estate market has had a predictable rhythm to it for the past several years, but 2020 has broken the crystal ball. Typically we see a seasonal slow down and retraction of prices this time of year, but the Denver real estate market is still going strong, driven by low supply and high demand. We did see a slight decline in showing activity in conjunction with the start of the new school year, but demand picked right back up shortly after.
Breaking Records
With seasonal predictability out the window, we're keeping an eye on leading edge indicators to provide in the moment feedback while the market continues to buck trends and break records. Here are the records that were broken in September:
- Highest average sale price for all residential homes combined, with 12% appreciation year over year
- Lowest days on market, with a median of just 6 days
- Highest sales volume, with the most closed and pending transactions than any September on record
- Lowest number of homes for sale by over 2,000 listings
- Lowest number of active listings for September
Motivating Factors
There are conflicting factors at play for Denver buyers and sellers that are influencing the relationship between supply and demand. This year, home has become more important than ever before. The unrelenting demand we're seeing from area buyers is in large part due to low interest rates, but also motivated by their current living situations. The pandemic has made everyone reconsider their dwellings with many looking to upgrade their spaces or just gain more space in general. For many homeowners, however, the logistics of a move feel extra burdensome during the pandemic. Sellers may be hesitant to open up their home due to safety concerns, or may find it difficult to relocate school age children and work-from-home spouses for showings and inspections. If you are thinking of selling, it may be worth the extra hassle. With fewer options for home shoppers to choose from, your home will have less competition in the market, and more interested qualified buyers (as long as it's priced appropriately).
The Stability of the Denver real estate market
How is it that the housing market continues to thrive during the pandemic? Interest rates are the obvious answer, but it's also due to the equity in the Denver market. Denver home prices have risen most of any major metro area in the country since the last recession, according to a 2019 report by ATTOM Data Solutions. If you've owned your Denver home for more than two years, you've likely built up an œequity cushion which provides stability and gives you options if you find yourself in trouble. Even if your home goes into foreclosure, it can likely sell for a healthy market value instead of losing money in a short-sale.
Buyes and sellers alike are finding opportunities in the market despite the ongoing pandemic. Ifyou have a home to sell, this is a great time to introduce it to the market.With the additional purchasing power that low interest rates provide, buyers remain steadfast in their search for their next Denver home. Check back next month for a report on market activity in October!
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