If you’ve been keeping up with the Denver housing market, you’re well aware of the highlights: mortgage rates, inventory shortages, and affordability issues have been the talk of the town for quite a while now. But, according to DMAR’s October 2024 Denver Real Estate Market Trends, it looks like we might be seeing a bit of change — or at least some movement.
October 2024 Denver Real Estate Market Trends
The Fed dropped interest rates by 0.5% in September, which gave the market a brief sigh of relief. Mortgage rates ticked down slightly but have since crept back up, leaving buyers and sellers wondering what's next. The numbers reflect this uncertainty, as the market continues to adjust to fluctuating rates.
Are Buyers Back in the Game?
Let’s look at the activity. Active listings were up 3.65% from August and a massive 45.69% from this time last year. That’s encouraging, right? But before we get too excited, new listings actually dropped by 1.19% year-over-year, even though they were up nearly 10% month-over-month. So, we’re seeing more homes on the market overall, but fewer new ones popping up—suggesting that inventory is still tight despite the rise in listings.
Buyer activity remains cautious. Pending sales increased by 3.64% from August and a healthy 25.37% YOY, but the follow-through isn’t quite there. Closed sales took a nosedive, down 19.18% MOM and 9.09% YOY. That gap between pending and closed sales signals hesitation—buyers may be finding homes, but they’re not rushing to the closing table. Could be those creeping mortgage rates or maybe just a wait-and-see approach to pricing.
Home Prices: A Gentle Slope Down
Speaking of pricing, the numbers are cooling off but not dropping off a cliff. The average closed price fell by 4.96% from August and is down 2.47% YOY, while the median closed price slipped by 2.34% MOM and 1.51% YOY. This means sellers aren’t exactly slashing prices, but the bidding wars we saw over the last few years are clearly on the decline.
That’s also evident in the close-price-to-list-price ratio, which stayed essentially flat at 0.04% MOM but dipped slightly by 0.26% YOY. Sellers are still getting close to what they’re asking, but buyers have a little more room to negotiate than they did during the peak frenzy.
Homes Sitting a Little Longer
Homes are sticking around a bit longer too. The average days in MLS increased by 5.41% from August and 30% YOY, while the median days in MLS surged by 78.57% YOY. Buyers are clearly taking their time, weighing their options, and possibly waiting for rates or prices to drop a little more.
What’s Next?
As we head toward the end of the year, the big question is whether mortgage rates will make a meaningful dip, and if so, how quickly buyers will respond. With fewer homes closing and inventory not quite hitting the levels buyers need, the market remains in a bit of a balancing act. If rates go up further, we could see more hesitation from buyers and continued price adjustments from sellers. On the other hand, if rates drop (and stay down), we might see a late-year surge in activity.
Whatever happens, one thing’s for sure—the Denver market is in for an interesting close to 2024. Stay tuned.
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