DMAR Real Estate Market Trends Report | MAR. '16
Denver-area Housing Inventory Breaks Record Low for the Month of February! From 1985-2015, February has averaged 14,979 active listings. The Denver-area had a record high of 25,484 in 2006, and closed out February 2016 with a historically low 3,963 active listings – representing a six percent decrease in inventory over the previous month and 2.8 percent decrease year over year.
“Market activity is picking up, but home sellers appear to be holding out for the upcoming spring frenzy in April and May,” said Anthony Rael, Chairman of the DMAR Market Trends Committee and Denver real estate agent. “This spring is shaping up to replicate last year's market of high demand significantly outweighing supply.”
Digging into the February MLS housing stats for the entire residential market (attached and detached properties), 4,269 new listings came on the market (up 11 percent compared to the month prior), 4,151 homes were placed under contract (up 15 percent) and 2,753 homes sold and closed (down seven percent). Average and median sold prices edged up from the previous month with gains of 1.5 percent to $377,917 and 3.4 percent to $330,000 respectively. Comparatively, the year-over-year increases were much more substantial with averages of nine percent and 11.66 percent respectively.
Notably, Rael comments, “Homes priced below $325,000 are in such high-demand that multiple offers well over list price will continue to be the norm until more listings come online.”
According to Rael, homeowners who bought in 2008-2011 are “cashing out and moving up.” With significant equity to roll over into a new home coupled with incredibly low interest rates, this segment of homeowners is realizing “big-time buying power.”
Our 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 February 65 homes sold and closed for $1 million or greater – down 4.4 percent from the previous month and up 22.6 percent year over year. The closed dollar volume last month in the luxury segment was approximately $104.2 million, down five percent from the previous month and up seven percent year over year.
“Denver County has just made the transition into a seller’s market in the sector of homes priced $1 million or greater, with an average 5.2 months of inventory,” said Jill Schafer, DMAR Market Trends Committee member and Denver real estate agent.
For contrast, homebuyers in Douglas County still have plenty of housing choices with 13.3 months of inventory. Heading north into Broomfield, buyers can be even more discerning with 26 months of inventory. Six months of inventory is considered a balanced market between buyers and sellers, less than that is a seller’s market.
Brooke Livingston, DMAR Market Trends Committee member and Denver real estate agent, adds, “As we head into spring, the Denver County luxury market is leading the overall 11-county area. Some home sellers in Denver County are receiving multiple offers, perhaps surprising some buyers who anticipated little competition. I think we’re still seeing an influx of homebuyers with significant cash holdings contributing to the stronger overall luxury market sales, a trend that will likely not slow for a while as Denver continues to boom. However, there is still room to negotiate in most situations for luxury buyers, a stark contrast to lower price points where competition remains fierce.”
The highest priced single family home sold in February was $2,604,938 representing six bedrooms, nine bathrooms and 6,280 above ground square feet in Highlands Ranch. The highest priced condo sold in February was $5,438,873 representing three bedrooms, three bathrooms and 4,627 above ground square feet in Cherry Creek North. Both the listing and selling agents for the condo sale are DMAR members.
