limited may inventory continues to drive metro denver home prices
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By Sara B. Hansen | Published on June 9, 2023
Despite close to 7% mortgage rates, limited supply drove home prices higher again in May.
Last month, all properties sold in metro Denver had a median closed price of $595,000, up from $580,000 in April. May was the third month in a row to record price increases.
Sellers posted 5,180 listings in May, 8.9% more than the 4,758 available in April.
But that number remains much lower than the 14,895 average for this time of year based on historical data from 1985-2022. May 2006 set the record high with 30,457 listings, while the record low for May fell in 2021 with only 2,075 available homes.
“Spring felt like a failure to launch, which has led to a summer kick-off where the natural rhythm of the Denver real estate market simply feels off,” Libby Levinson-Katz, chair of the DMAR Market Trends Committee, said in the monthly report.
“Due to the lack of inventory, buyers are experiencing a bit of fatigue as they wait for either the perfect home or to uncover a good deal.”
Time on market drops
With only about one month of inventory, properties don’t last long on the market. The number of days on the market decreased from seven to six from April to May.
The need for specific homes remains high. For example, according to the monthly report, demand for ranch homes or “main level living” in south metro Denver is high, but inventory remains low, so buyers face multiple offer situations, sometimes having to pay over asking with appraisal gaps for this popular home style.
Natalie Hengel with The Agency says she’s seeing a more cooperative spirit between buyers and sellers.
“Right now the market is better than ever. Buyers and sellers are “playing nice” and are working together to create deals where everyone walks away a winner,” Hengel says.
“That being said, it’s still competitive out there, and buyers need to be prepared to submit strong offers, whereas sellers need to be thoughtful with their listing price in order to get the best price and terms for their homes. This is why it’s more important than ever to connect with an expert agent who knows how to execute a strategic plan in order for the client to achieve their real estate goals.”
Price remains key
Persy Sample of The Agency says sellers still need to be conscious about their homes’ quality and price appropriately to adjust for rate hikes.
“As for the buyers in the market, yes, you have the opportunity to be pickier with your choices,” she says.
“However, that does not mean being greedy. There are a lot of opportunities to get a really amazing deal in this market, but it only comes to those who are properly prepared and understand the value of the home they are pursuing.”