Home buyers continue to lament the drop in the number of homes on the market, a fact that appears to be driving price increases and lightning-fast sales in the Denver metro area.
This observation is underscored by the latest Metrolist statistics on area home sales.
According to Metrolist, there were 60% and 59% less homes and condos, respectively, on the market in April than there were the previous April. Furthermore, these properties sold for 8% (homes) and 17% (condos) more than the previous April.
Properties are selling in a little over a month. The average house took 37 days to sell; the average condo, 36 days. This marks a decrease in time of 27% (homes) and 29% (condos) over a year ago.
Such statistics show a continuation of trends reported in March that prompted real estate agents and observers to discuss market challenges with Inside Real Estate News.
“Don’t be mislead by the chatter at the national level about affordability and tight credit hurting demand,” brokerage owner Lane Hornung said. “That may be true in other markets, but our market has anything but a demand problem. We have a supply problem. “…Loan officers are sitting on completed and approved loan applications for buyers who just can’t find a house to buy, often having bid and lost out a few times,” he added. “….Our inventory supply across the entire Front Range is tighter than it’s ever been.”
Agents noted that prices are escalating, a trend brokers at RE/MAX of Cherry Creek confirm. While industry experts predicted that home appreciation would rise 3-5% nationally this year, Denver’s lack of inventory is driving appreciation and prompting RE/MAX of Cherry Creek agents to wonder if sales prices here might rise by as much as 10% in 2014.
Many report that buyers are often offering above asking price, to counteract multiple offers on a single home. One broker, for example, told Inside Real Estate News that his client paid $394,000 on a home in Denver priced at $368,000 in order to seal the deal. “I’m telling my clients that if they want to get a home, a lot of times they have to ignore the listing price and be aggressive to win.”
That appears to be good advice, at least for the short-term market.
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RE/MAX of Cherry Creek