Denver home prices hit high in August, but market may be slowing
The recent Case-Shiller Home Price Index recently highlighted the current state of real estate in Denver, and additional reports on the city's housing market continue to flood news channels. The index showed that the Denver metro area's home prices increased year-over-year for the sixth year in a row, and was the largest increase Denver had seen in a period of 26 months. The Colorado Division of Housing pointed out that the index value is the highest Denver has had since August 2008.
A recent CBS Denver article detailed that Denver's housing market is fast-paced, with record-low interest rates. The source reported that numbers indicate many people purchasing homes in Denver are buying expensive houses.
"A few years ago high-end homeowners complained they couldn't give the houses away, now the complaint is far different," CBS Denver stated.
Houses that have sale prices of $1 million-plus are seeing significant sales volumes and buyers are complaining there aren't enough of these high-end homes to choose from, CBS Denver reported. This is in part due to interest rates being under 4 percent and fewer homes being built.
The source revealed that many Realtors in the Denver area agree that the high-end housing market is experiencing a revival even though high-end homes typically appeal to only a small segment of the population.
The revival in Denver is not limited to high-end homes. Overall, the average price of a home that is for sale increased from last year and the amount of time that homes stay on the market went down.
While Denver's housing market is thriving, a mid-August 2012 article in The Denver Post cited studies showing the area's market gain is subsiding. The source drew on a report from Hanley Wood's Builder Local Markets newsletter, which showed there was an increase in closings on new homes in May, but that this uptick was less significant than the increase observed in April.
The newsletter report further stated that new home closings made up approximately 6 percent of all closings for the 12 months ending in May. In 2011, new home closings made up 6.7 percent of all closings. Another report cited by The Denver Business Journal showed that the Denver metro area experienced a slowdown in home resale numbers in August. While August home sales were up 18 percent over last year, the increase was only 1 percent over the month of July.