Denver real estate prices have seen record highs over the last two years, but the market pulled back significantly in the last sixty days. The housing market took a noticeable dip in the early fall, giving buyers better options with a wave of price reductions. Have we seen the end of the roaring housing market in Denver?
Where Are We Today?
2016 Price DecreaseHome prices peaked in the early summer, but price reductions have been as common as new listings this fall. Part of this is the typical seasonal slow-down, which caught many sellers off-guard, with their properties priced too high to sell.
Real estate is cyclical, with predictable highs and lows throughout the year. Families with school-aged children typically move between school years, making the summer months more active. Of course this doesn’t drive all of the activity. There are other factors that cause people to move in the summer and bring on the autumn slow-down. Cold weather, holidays and this year’s upcoming election can all have an impact on timing.
Did Sellers Miss the Peak?
With the market pulling back, did sellers miss their opportunity to sell property at peak prices? Probably not. First, Denver continues to lead the country in a strong economy, with thousands of people moving to Colorado each month. With the increasing population, the current housing market still can’t support the growth.
Second, the National Association of Realtors reported they except to see a slow-down in price increases in 2017, but it would still increase by another two percent. With a strong local economy, Denver will likely see continued growth, and increased prices, just at a more moderate pace.
The Crystal Ball Forecast
Although we are currently seeing a seasonal slow-down in the market, 2017 will pick back up in the spring and promises to be another strong year for real estate. As long as the population continues to increase and home builders continue to play catch up with new inventory, home prices will maintain their high levels.
The factor that could slow both price increase and some sales is affordability. We have already begun to see buyers refusing to pay unrealistic prices and forcing sellers to re-evaluate their asking price. People who either cannot afford to pay the costs, or are simply unwilling, are beginning to look outside of the Denver Metropolitan area.
For buyers, now through the end of the year is a good time to buy. Competition has waned and prices have pulled back. Properties are sitting longer, making the market feel a little more normal. For the seller, spring will be the time to list and get higher prices. Nonetheless, the market is still viable today, and good properties are still selling quickly.