Denver Real Estate Market Trends
As is the case in many areas of the country, the Denver real estate market is going through some significant changes this fall. Whether you are planning to sell your home or are in the market to purchase a home it is essential that you have a firm understanding of the current market trends. In Denver, the overall market trend appears to be moving from what was clearly a buyer’s market just one year ago to a seller’s market.
Prior to the recent economic recession in the United States, real estate values across the country soared to all-time highs. Those values then plummeted virtually overnight as the real estate “bubble” burst and the recession set in throughout the country. For many homeowners, the value of their property dropped by as much as 50 percent, often resulting in a situation where the property was not worth what was owed on it. During this time, a buyer’s market prevailed with rock bottom home prices and an overabundance of inventory. Denver home prices, however, are climbing again and inventory is decreasing – both signs that we are headed for a seller’s market in the near future.
There are three sets of statistics that experts typically compare when determining where a real estate market is headed – median sales price, total inventory, and median number of days on the market. By comparing year-to-year figures for those three data points we can make an educated guess where the Denver real estate market is headed this fall. Based on the ZipRealty Housing Trends Report for the month of August, the median sales price for a home in Denver was $240,000 compared to a median sales price of $265,000 in August of 2013, almost a ten percent increase year-to-year. Likewise, when we compare the number of homes that were on the market in August of 2012 (12,621) with the number of homes on the market in August of 2013 (11,998) we see about a five percent decrease in total inventory year-to-year. Finally, the median number of days that a property remains on the market has dropped from 18 to 10 year-to-year, representing a decrease of almost 50 percent. Each one of these indicators alone points to the Denver real estate market moving from a buyer’s market to a seller’s market. All three together can be taken to mean that the market is definitively trending toward a seller’s market.
Whether you are a seller thinking of selling or a buyer planning to buy, the continuously changing market conditions make it even more important that you work closely with an experienced real estate agent. In all likelihood, Denver real estate prices will continue to rebound, meaning that determining the fair market value of a home will be difficult in the near future. An experienced real estate agent, however, knows the market and is able to use “comparables” to ascertain a fair market value for either a buyer or a seller. Moreover, if you are planning to buy a home in Denver, you may find fewer available options as the overall inventory shrinks during the coming months. Again, utilizing a real estate professional increases your chances of finding the perfect home for you and your family in the Denver real estate market.