Denver real estate is no exception when you look at any market driven by supply and demand. You will see peaks and valleys of price. When demand is high prices go up…think of oil in 1973-75. While not absolutely analogous to todays’ Denver real estate market the oil embargo of those years dried up supply and we had lines at the gas stations waiting to get any gas we could. Today, home Buyers in parts of Denver are lined up waiting to buy the next home that comes on the market.
Have a look at the chart and you will note the “New Listing” plus the “Back On Market” listings (supply) equal the “under contract” listings. Then note the “SOLD” properties and they seem out of balance (of course these went under contract about 1 month ago). This 7 day snap shot represents the end of the month, therefore closings should be a bit higher.
While this may appear “balanced” this represents an average time on market in Denver of about 30 days which is a exceptionally fast Seller’s market. Appraisers are trying to stay up with trends and given recent legislation, they are hamstrung, even though it is an “appreciating market”. And the underwriters at the mortgage companies are trying to understand that inclusions do not always add value, but they still have to account for them. This means that when you price your home you need to stay withing the window of what the value should be according to the appraiser. Of course, if you do not mind having your house on the market for 6 months, that market “may” catch up to you.
Denver’s neighborhoods and suburbs are the final challenge; where do you want to live? Each one has its own dynamic of supply & demand such as Highlands Ranch and Lone Tree where there is very little inventory. Price ranges too can create a slower market than that published. Averages are just piles of numbers thrown together to make a point…Denver is a great place to buy a home or if it is time to move to Arkansas to retire, prices here are good.
Prediction: Prices will go up or prices will go down or prices will stay the same. I know I will be right at least 33% of the time.
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