Denver-metro home prices hit an all-time high in January as inventory continued its own record-breaking streak— in the opposite direction.
The average price of a detached single-family home rose to $629,159 in January, according to the monthly report of the Denver Metro Association of Realtors (DMAR). The average cost of an attached home also reached a record high, at $397,792.
Meanwhile, the number of homes on the market continued its race to the bottom, with only 2,316 properties available. (By contrast, the average number of active listings for January, with record-keeping starting in 1985, is 13,022.) The new number represents an 8.85% drop from the previous record-breaking low number of homes for sale last month.
This is good news for sellers, who can generally expect to get top dollar for their homes. As for buyers and their agents?: “The market is challenging, frustrating and unnerving,” notes DMAR.
With homes selling at 101.03% close-to-list price and spending a mere five days in the Multiple Listing Service (compared to 24 days last year), buyers are scrambling.
Their plight has prompted DMAR to offer advice to real estate agents on how to handle their clients.
“Prepare your buyers – especially first-time buyers – for what a competitive market looks like,” DMAR suggested in the monthly report. “Set good expectations of what can happen in a multiple offer situation and let them know upfront ways that can help them be competitive…Completely waiving contingencies like an appraisal, loan and inspections help buyers compete, but sometimes still doesn’t win. Cash is king in this competitive market.”
While the Denver market has its unique factors, the low inventory reflects a national trend. Some attribute the country-wide situation to the pandemic, which has sparked a crush of people seeking homes for more space. Worry of infection also has potential sellers waiting to put their homes on the market until they can be vaccinated.
In the meantime, real estate agents are treating their buyers gently.
“When talking to fellow REALTORS, the consistent theme is sympathy,” stated Chair of the DMAR Market Trends Committee Andrew Abrams in the new report. “Sympathy for their buyers who fall in love with a house, put in an offer above what they had expected and still don’t get it. As long as interest rates continue to remain low and inventory scarce, there will continue to be multiple buyers for every reasonably priced house.”