Record low inventories have brought the Denver real estate market to a buzz nation-wide with buyers struggling to purchase homes.
Competition for existing homes has created a strong seller’s market, giving buyers fewer choices and less leverage in negotiating a deal. Denver real estate agents are frustrated as well, unable to put their buyers into the properties they want to own.
With the high demand, homeowners have taken the opportunity to jump into the market and list their homes, knowing their chance of selling quickly, and at their asking price, is high. Where just two months ago “for sale” signs were scarce, they are now popping up all over, and going under contract as quickly.
The hot market has pushed home prices up as well. The demand has given sellers the ability to ask for more and get it. According to data from Denver Metrolist, in 2014, the average sales price of a home in Denver has jumped 10.2% from January to May. That’s a difference of almost $30,000. This brings many homeowners who were “under water” on their mortgage into a position where they can now sell their home without losing money.
Denver Home Prices 2013A Great Recovery?
But this isn’t the great recovery it may appear to be. The Denver real estate market is hot, and that has pushed prices up, but up to the levels they were at a year ago. Average home prices were at the same levels in June and July last year, just over $317,000. What we don’t see is the slow decline in pricing through the second half of 2013, where prices bottomed out in February 2014 at an average of $282,210. The real recovery from the recession happened last summer.
Looking Ahead In Denver Real Estate
The Denver housing market will likely stay strong through 2014 with a lot of pent up demand waiting to be released. New home construction is up as well, but hasn’t affected existing home sales this year. As more home owners put their properties up for sale, buyers will have more options and increased negotiating power. Higher inventory and lower demands will slow the price increases and the market will level out.
Summer is high season for real estate sales. Expect to see some additional minor gains in housing prices over the next couple of months, then a leveling in the Fall and the typical drop in Q4. As more homes come on the market, prices will be forced to adjust and buyers will move closer to the driver’s seat in the Denver market.