Denver Real Estate News – December 2023
LOCAL MARKET UPDATE
Getting Historical Instead of Hysterical
Despite a challenging market due to higher interest rates, homes continue to change hands. Typically, the Denver Metro experiences our lowest inventory within the last two months of the year. This year, however, end-of-year increased inventory is a welcome shift as we enter the holiday season.
Active listings are up just over 2.5% year-over-year. While this increased inventory is a relief to buyers, we still aren’t close to a balanced market. October closed out the month with active listings sitting at 7,482. For context, the average active listings for October are 14,755. We consider a balanced market one with 4-6 months of inventory. We are currently at 2.5 months of inventory.
While the interest rates have caused a notable shift in market activity, it’s certainly nothing worth getting hysterical about. The most recent year-to-date numbers are most comparable to those of 2019. Sales volume is over $24 million, median days in the MLS is at 11 (just one day shy of the median in 2019), and the close-price-to-list-price ratios are both over 99%, while pandemic years were over 103%. It’s time to stop comparing current data to that from the pandemic years. Those years were a perfect storm of low interest rates, and unprecedented demand while homeowners fell out of love with their houses working from home, paired with the ability to work remotely.
Regardless of the prevailing market challenges, there exists a valuable opportunity for both buyers and sellers to leverage the current real estate landscape to their advantage by implementing a strategic game plan.
(Info Source: D.M.A.R. (The Denver Metro Association of Realtors, YCRE Analysis)
INFO FOR SELLERS
Take Advantage of Serious Buyers
Although the interest rates have shrunk the buyer pool, one silver lining is that those looking for a house are serious. Most of these buyers are motivated by life changes creating the need to move compared to the many previous opportunistic buyers motivated by a desire to take advantage of historically low rates.
As before, it’s imperative to price your home correctly. Buyers have more options to choose from and are no longer willing to overpay. Also, be prepared to negotiate. In October, 57.9% of closed transactions included an average seller concession of $9,390 – don’t miss out on a serious potential buyer by clinging to the market conditions of the pandemic years. They are long gone.
(Info Source: D.M.A.R. (The Denver Metro Association of Realtors, YCRE Analysis)
INFO FOR BUYERS
It’s the Most Wonderful Time of the Year…to Buy!
Regardless of interest rate, winter remains the most advantageous time for buyers to find a home. Typically, sellers who have their home listed at this time of the year are selling now because they must. Sellers with flexibility tend to wait until spring to list when the buyer pool is at its peak. The holiday season usually brings less competition as many buyers take a pause as life gets busy with events, travel plans, and less-than-ideal moving weather. Combine these factors with more inventory than usual and sellers who are willing to negotiate concessions & inspection items, and you have a recipe for a successful real estate transaction!
Take advantage of these ideal terms while other buyers sit on the fence! Although the interest rates can be daunting, the key is to get into the homeownership game and experience appreciation as it moves upward over time.
(Info Source: D.M.A.R. (The Denver Metro Association of Realtors, YCRE Analysis)
*We use reasonable efforts to include accurate and up-to-date information. The real estate market changes often. We make no guarantees of future real estate performance and assume no liability for any errors of omission in the content.
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