As the Denver weather toggles between winter and spring, the real estate market continues it's double digit growth that started in August of 2020. March numbers for the detached segment of the Denver real estate market show a 6.72% increase from February. That kind of appreciation would be great for a full year, but for just 31 days it's almost unbelievable.
Notable Stats for March
While we are seeing new listings hit the market, buyers are out in even greater numbers to scoop them up, leaving us with a historically low active listing count at month's end. For the detached market, that leaves us with just 1,122 listings (or .39 months of inventory),meaning we would completely sell out in 12 days if nothing else came to the market in that time. For attached properties, that number is even lower, with just 799 listings left at the end of March. If you're doing the math, that's less than 2,000 listings for the entire metro area!
Breaking Down The Inventory Crisis
How did we get ourselves into the current inventory crisis in Denver? The answer is multi-faceted. We know that buyer demand is strong due to basement level interest rates, but that's not the only factor. Part of the issue has been looming all along with 13 years of less than average new homes being built to sustain the incredible population growth in Denver. Another issue is that homeowners who were able to lock in a refinance at 2.62% are not likely to sell their house anytime soon, keeping it off the market for years to come despite it being the best time in history to be a seller. And lastly, millennials are the largest demographic to enter the market and they are invested and undeterred in their search for a home to call their own.
Buyer Opportunities
Nope, that's not an oxymoron. Opportunities do exist for buyers in the Denver real estate market. There's a reason buyers are fighting over homes and paying well over list price to get them. Low interest rates can offset the extra offer price to some extent, but more importantly they allow more of your payment to go towards principal than interest. Rates are expected to start creeping up as the economy opens up and will potentially be back over 4% in 2022, so right now is still a great time to buy at a low rate.
While attached homes are appreciating at favorable rates, the downtown market still hasn't made its comeback. Opportunities exist to get into an attached property downtown while appreciation has stalled, then watch it grow with the economy. Another big buyer opportunity is the downsizer market. If you're thinking of downsizing, you'll be in prime market position to sell your current home for top dollar and use the equity to win offes on a smaller place.
Can the Denver real estate market sustain double digit growth for another month? Next month we'll begin comparing the year-over-year stats to last year's quarantine numbers, so it's entirely possible.
Socials