The number of homes for sale in Denver dropped dramatically in December, but the tight inventory didn’t seem to spark heated sales. Rather, the market continued to moderate.
How low did things go? Jill Schafer, head of the Denver Metro Association of Realtors’ (DMAR) Market Trend Committee put it in stark terms: “The number of attached and detached homes new to the market in December dropped like the ball in Times Square, down 41.18% from November.”
While the number of homes on the market typically drops significantly from November to December, inventory was extremely low compared to historical numbers. There were 5,577 residential homes on the market in December, according to DMAR’s monthly report. This compares to a 22-year average of 13,403 active listings for the month. The record high was 24,603, logged in December of 2007.
Despite the limited options, buyers eschewed the frantic attitudes of recent years. Indeed, available homes spent a longer time on the market: an average of 39 days, up 21.88% from November and 8.33% from a year ago.
Even rising interest rates didn’t create a sense of urgency. Instead, the DMAR report notes that “buyers aren’t willing to compromise on their list of wants vs. needs to rush into a home due to interest rates.”
Perhaps in response, sellers are becoming more realistic about pricing their homes. Whereas in months past, sellers with dollar signs in their eyes pushed prices as high as they possibly could, this is no longer the case. “Home sellers indicate a better understanding of properly pricing their home to reflect current market conditions than any time in recent memory. Though not all are keen to the changing market most are warm to the notion that our ‘aspirational pricing’ market looks to be in the rearview mirror,” notes DMAR.
What will all this mean for the coming year?
Schafer reports that the National Association of Realtors (NAR) predicts the Denver metro area market will stabilize in 2019. NAR also estimates that the number of homes sold here will drop 6.7% and prices will rise 6.8%.
“Despite what feels like a major shift, sellers are still in control in all price ranges except for homes prices over $1 million where buyers and sellers are on equal footing,” notes Schafer.