via Denver Business Journal

By Jensen Werley | Published on October 5, 2021

The Denver-area housing market saw a relative slowdown for inventory in July and August, but the end of September saw a 10.86% increase in inventory compared to the previous month, according to the October Denver Metro Real Estate Market Trends Report from the Denver Metro Association of Realtors. The report led DMAR experts to call this a good time to buy.

The October report showcases the September market transactions encompassing 11 counties of the Denver metro area.

In August, a relatively low number of houses hit the market, which was reflected in the number of closed properties in September: 5,233 homes, which is 12.81% lower than the same time period the month prior. It’s also a “staggering” 19.27% lower than last year at this time, wrote Andrew Abrams, chair of the DMAR Market Trends Committee, in the commentary accompanying the report.

“With lower inventory and fewer houses for sale, the balance of supply and demand stayed steady, leading to another month of competition for buyers,” Abrams wrote.

The most competitive segment of the market — excluding the $99,000 and below homes — were homes in the $300,000 to $399,999 price range.

“The surprising number for this category was that there were 218 closed properties, showing that you can indeed find a single-family detached property under $400,000,” Abrams added.

This price point had just about half a month of inventory. A balanced market ranges from about four to six months of supply, DMAR says. When there’s a low number of months’ supply of inventory, it’s a sellers’ market. In total Denver real estate, months of inventory increased to 0.76. It might not feel like a huge increase, Abrams said, but it gives potential buyers a few more options.

One of the big questions surrounding the housing market has been whether there’s a housing bubble and if it’s going to burst. But Brigette Modglin, also a DMAR Market Trends Committee member and Denver realtor, predicted that won't happen.

“We are in such a unique time, and all the data and signs indicate that we won’t have a housing bubble as we did back in the early 2000s,” she wrote. She cited as possible reasons a 40-year low inventory that supply just cannot keep up with and population growth as millennials approach homebuying age. Wages are another reason: Only 3.4% of income is going toward mortgages, compared to 7.2% going toward mortgages leading up to the foreclosure crisis.

Abrams recommends jumping into the real estate market now.

“Even though prices are up over 15.11 percent [on average] year-over-year, now is still a great time to buy,” Abrams wrote. “The buying process has always felt intimidating — giving all of your personal information to a lender, going through other people’s properties, imagining yourself in them and writing an offer in the hopes that a seller will ‘choose you.’ With the low-interest rates expected to increase coupled with a seasonal increase in inventory, waiting will only cost you more money in the future.”

For September 2021, there were 6,125 new residential listings for attached and detached homes. The month before, there were 6,110 new listings and a year ago there were 6,478 new listings.

At month's end, there were 3,971 active residential listings. That figure includes both attached homes, such as condos, and detached homes, like single-family houses. It’s 10.86% higher than the prior month, but 25.09% down year over year.

The median closing price was $530,000 — down 0.56% from the month prior but up 15.22% from the year before.

If homes below $400,000 were the most competitive, the least competitive market was attached properties over $1 million, Abrams said. There were more than two months of inventory for those homes — which is more than four times less competitive than the $300,000 to $400,000 range.

In the luxury market, there have been 501 new listings for detached and attached homes, up from 478 new listings the prior month and 435 new listings a year ago. There were 439 sales that closed, compared to 365 a year ago and 489 the month before.