This spring's Denver area housing market has seen a buyer shortage become the new listing shortage. (You know what they say: one day you're in and the next day you're spending much longer in the MLS). Sales slumped as of May, an indicator of affordability challenges in Colorado (and across the country) while pent-up demand is beginning to wriggle out of the market's long-held grasp despite interest rate stagnation.
June 2024 Denver real estate trends highlight these shifts, along with a record-breaking statistic and some notable home price plateaus. What does this all mean for the summer selling season? Let's take a look.
| Residential (Detached & Attached) | May 2024 | Month Over Month | Year Over Year |
|---|---|---|---|
| Active Listings at Month's End | 9,159 | 31.03% | 75.19% |
| New Listings | 6,966 | 16.51% | 33.88% |
| Pending | 4,265 | 1.94% | 4.38% |
| Closed | 4,198 | 5.72% | -5.41% |
| Close Price - Average | $720,109 | -0.74% | 3.31% |
| Close Price - Median | $600,000 | -0.41 | 0.85% |
| Days in MLS - Average | 27 | -10.00% | 22.73% |
| Days in MLS - Median | 9 | 12.50% | 50.00% |
| Close-Price-to-List-Price-Ratio | 99.79% | 0.07% | -0.69% |
| Data courtesy of Denver Metro Association of Realtors | |||
June 2024 Denver Real Estate Trends
Worthy of the Housing Market Hall of Fame
Active listings at the end of May increased by 31% as compared to April and by 75% as compared to May 2023. The historical average increase in active listings from April to May is 7%. This May's 31% boost set a new record, surpassing the previous record of 26.8% in 2019.
This significant shift relieves some of the intense inventory pressure Denver has experienced for the past decade, offering more options for buyers and less price-hiking buyer competition.
Sellers Getting Crafty
Along with this inventory boost comes a climb in the number of days homes spend on the market. Listings spend an average of 10% fewer days in the MLS compared to last month, but almost 23% more days in the MLS compared to last year. And the median days in the MLS (often a more accurate measure, especially when outliers skew data), increased by nearly 13% since April and by 50% compared to last May.
These numbers are no surprise, given the unprecedented inventory boost. But likely due to stagnant interest rates and affordability issues pending listings saw only modest increases (2% month-over-month and 4% year-over-year.) Similarly, closed listings increased by 6% compared to May but decreased by 5% compared to last year.
What does all this mean? Sellers need to get crafty. Those with homes on the market are taking more care in spiffing up their digs and are negotiating sales prices and interest rate buydowns.
Stagnating Home Prices
The ultimate impact of motivated sellers and tentative buyers? A proverbial plateauing of home prices. The average home price decreased by just under 1% month-over-month and increased by 3% year-over-year. The median home price decreased by 0.4% month-over-month and increased by under 1% year-over-year. This may signal a future shift in affordability especially if mortgage interest rates go down.
Pro Tips for Entering the Denver Real Estate Market
Increased listings, flattening home prices, restrained buying, and obstinate interest rates have started to shift some power into the hands of buyers. That means sellers need to put some extra effort into their listings to avoid falling out of fashion.
Thinking of selling your home? Consider:
- Pricing your home realistically. Buyers aren't battling it out over the few available listings anymore. Comparing your list price to similar homes in your area and factoring in market conditions, location, etc. is essential. Don't worry, a skilled real estate agent can help you with that!
- Giving your home a mini makeover. Attracting buyers is a bit more challenging these days. The solution? Making your home look as appealing as possible. A new coat of paint, a lot of decluttering, and maybe some professional staging can go a long way.
- Negotiating with interested buyers. Have a prospective buyer? It might pay off to accept an offer that's not quite at list price or offer to cover the costs of an interest rate buydown.
Interested in buying a home? Even with the influx of listings, there are some challenges to overcome. Consider:
- Planning your home budget around your monthly housing allowance. This number might be lower than what you can pre-qualify for but think about how much you can actually spend on your mortgage each month then work backward from there. (A skilled mortgage professional can help you with this one.)
- Being flexible about neighborhoods and wishlist items. You never know where you'll find the right home that fits in your budget. And chances are, it's not the first place you'd look. A real estate pro who knows your area well can be invaluable here.
- Being creative with financing. Affordability is quite the obstacle to homeownership these days. And sure, some people just can't afford to own a home right now, despite their best efforts. But don't be discouraged off the bat. Not every home loan is the 20% down payment, 650 credit score option. You might qualify for first-time homebuyer support, a more flexible FHA loan, or another type of mortgage that could help put the home purchase within reach.
Need some expert real estate advice? Connect with one of the best real estate agents in the Denver area for individualized guidance.
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