Buyers believing the Denver metro housing market was finally shifting in their favor got a rude awakening in November, when the number of homes on the market dropped precipitously.
As Chair of the DMAR Market Trends Committee Jill Schafer put it: “The number of new listings was as scarce as the sweet potato casserole after the first pass around the table.”
According to the Denver Metro Association of Realtors (DMAR) monthly report, there were 32.70% fewer new listings in November than October, and 18.34% less residential homes to choose from overall. The report also showed 22.78% fewer sales.
Meanwhile, as the market tightened, prices went up slightly (1.43%) from October to November and a bit more significantly (6.76%) from a year ago.
“Fewer homes on the market means it’s tougher for buyers in an already expensive city to own real estate,” noted Schafer, “especially in the very popular housing segment of homes priced under $400,000. Many buyers continue to have to put in multiple offers before landing a home.”
Experts note that it’s typical for home sales to drop during the winter. But this November was atypical in some ways. “[T]he 18.34% decrease [in listings] from October to November of this year outpaced the 11.82% drop in the same period in 2018,” reported the Denver Business Journal. “November is also the first month of the year to see active inventory down from a year ago.”
What is fueling this drop in inventory? Nicole Rueth, a Denver mortgage expert and a member of DMAR’s Market Trends Committee, told the Business Journal that she attributes it to a “change in the seller’s psyche.”
“What I’m hearing is people are waiting to put their house on the market until they can find something, but they can’t find anything because other sellers are waiting. It’s self-perpetuating.”
Few can say with certainty where the market will go from here, but Schafer was quick to assure readers of the DMAR report that all is well. “Continued increase in prices and a comfortable, sustainable rate of appreciation still makes real estate a solid investment.”