Affordability continues to be an obstacle for prospective home buyers in the Denver Metro area. Although we’ve seen prices cool since their peak in April 2022, the median closed price for a Denver Metro home is still 34% higher than we saw in February 2020 or pre-pandemic.
The metric for standing inventory is indicating gains; however, there is still not enough available housing to make up for the years of shortages. Inventory could remain a challenge as new home builders balance their costs and what buyers can afford
Prospective sellers are re-evaluating the feasibility of listing their homes for sale as the days of multiple offers and bidding wars are in the past. The number of new listings sellers brought to the market is the lowest we’ve seen in any August since 2009.
In August, homes sold on for an average of one percent below the original list price. This could be a great opportunity for buyers as sellers are open to negotiate and more options are available. For sellers, setting a competitive listing price is essential for attracting interested buyers
The number of home closings in the Denver Metro area was 27% lower this August as compared to last due in part to buyer affordability constraints and rising mortgage rates. The metric for home sales hit a peak in May 2022 and has seen month-over-month decreases since. The slowing market has resulted in year-to-date closings down 15%.
The number of homes in Pending status, a leading indicator of closing activity, was lower than we’ve seen in any August in a decade as buyers contemplated the economic uncertainty. Compared to last month, the number of signed contracts to by existing homes in the Denver Metro area saw a seasonal increase.
Affordability continues to be an obstacle for buyers. Month-over month the median closed price has cooled and is now 7% lower than the peak we saw in April. However, prices are still 8% higher than last August and 34% higher than February 2020 or pre-pandemic. On average, homes closed for 1% lower than the original list price in August.
Sellers are more reluctant to bring fresh inventory to the market as the days of multiple offers have gone and homes are remaining available longer. The number of New Listings brought to the market was 15% lower in August than we saw last year at this time. With the month-to-month decrease, the number of new listings of homes for sale is the lowest we’ve seen in any August since 2009.
Days in MLS
With more standing inventory and less demand, buyers have more time to look at active listings and submit offers. The median number of days it took a listing to move from actively available in the REcolorado MLS to the Pending status is more than double what we saw last August and 4 days more than last month.
At the end of August, there were nearly twice as many listings actively available on the market than we saw in August of 2021. There is more standing inventory as shoppers are taking more time to submit contracts on available homes.
Total sales volume for August is lower than we’ve seen the last several years as the number of closings and closed prices cool.