DMAR Real Estate Market Trends Report | FEB. '17
Lowest housing inventory on record for month of January, combined with steadily rising interest rates, sets metro Denver up for an early spring selling season.
Active listings in the residential market (single family and condos) dropped 6.47 percent to 3,989 last month, which represented an all-time low for any January on record – and only the second-time active listings have dropped below 4,000. The number of sold listings in January decreased by 33.21 percent compared to the previous month. According to Steve Danyliw, Chairman of the DMAR Market Trends Committee and Denver real estate agent, these decreases are normal for this time of year.
“Low housing inventory has been a key driver for over two years now and I don’t see that changing any time soon,” said Danyliw. “Historically, inventory follows a seasonal pattern. We see the bottom in January to February, then peaking in late August to September. The second driver is mortgage interest rates. All predictions indicate a steady rise in interest rates throughout 2017. This could compel buyers that are sitting on the sideline to get into the big game. This - combined with mild temperatures - could cause our spring selling season to start early. I’ve seen forecasted estimates on housing appreciation ranging from 4.5 percent to 10 percent. I think 2017 will hit somewhere in the middle of those numbers.”
In the single-family home market, the average sold price rose 3.86 percent to $448,374, while the median price remained relatively unchanged at $380,000. Year-over-year, housing prices have increased 9.25 and 9.99 percent in the average and median sale prices respectively.
The condo market showed 34.05 percent fewer sales than the previous month, while the average and median sales prices dropped to $288,962 and $242,500 respectively. Year-over-year condo sales prices showed impressive gains, an increase in the average price by 6.83 percent and median price by 12.79 percent.
“Sellers are thrilled by the price appreciation and buyers are frustrated by the low inventory,” comments Danyliw. “If you’re a real estate agent working with a homebuyer under the $400,000 price point, you have a front row seat to a real estate feeding frenzy.”
DMAR’s monthly report also includes statistics and analyses in its supplemental “Luxury Market Report” (properties sold for $1 million or greater), “Signature Market Report” (properties sold between $750,000 and $999,999) and “Premier Market Report” (properties sold between $500,000 and $749,999). In January 79 homes sold and closed for $1 million or greater – down 15.96 percent from the previous month, and up 16.18 percent year-over-year. The closed dollar volume in January in this luxury segment for both single family and condos was $127,658,230, down 3.68 percent from the previous month, and up 16 percent year-over-year.
The highest priced single-family home sold in January was $5,400,000 representing four bedrooms, seven bathrooms and 10,740 above ground square feet in Evergreen. The highest priced condo sold was $1,850,000 representing two bedrooms, three bathrooms and 2,771 above ground square feet in Denver (Lodo). Listing and selling agent for the condo is a DMAR member.
“The temperature continued to drop in the Luxury Market in January, as many agents who specialize in homes priced over $1,000,000 reported few to no showings over the past two months,” said Jill Schafer, DMAR Market Trends Committee member and Metro Denver real estate agent. “No reason to send out a winter storm warning yet though. The Luxury Market is still starting off warmer this year than any January in the past four years.”
For condos priced $1 million or greater, January sales were down 43.75 percent from December, but December sales were 150 percent higher than November. Luxury condo sales last month were more than double the number of sales compared to January 2014.
Schafer adds, “Luxury condo sales were smoking compared to the first month of 2013, 2014, and 2015. The high-end segment of the market is still the only place where homebuyers have more control than sellers. In fact, buyers in the suburbs have a lot of choices, but the very popular central Denver neighborhoods are as tight for million dollar and up homes as they are for other price ranges.”
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