Like the weather, the Denver housing market cooled in November. While such slowdowns are typical of the fall/winter season, this may also represent a longer-term trend, according to some experts.
The Denver Metro Association of Realtors’ (DMAR) monthly report shows that the number of residential homes on the Denver market dropped 11.82% from October to November. Still, inventory, at 7,530, was an eye-catching 46.76% higher than November of 2017, but still far below what would be considered balanced inventory.
Average sold price ($462,344) dropped 1.64% from October, but is still up 6.47% from last year in November.
The market typically slows after the spring and summer season, as buyers drop out during the cold weather months. But many experts note that the trend may not be temporary. Realtor.com, for example, predicts that the Denver market will slow significantly next year, according to the Denver Post. But the real estate website also emphasizes that the market is still strong.
“Despite the anticipated slowdown in sales, the Denver housing market remains on solid footing,” Realtor.com’s chief economist Danielle Hale told the Post. The real estate website forecasts a 6.7% drop in home sales in metro Denver next year, yet it also predicts that median home prices will rise 6.8% as buyers aged 25 to 54 who already own homes and have built equity seek to “move up.”
“Repeat buyers are likely to drive up the median price of homes in Denver as the mix shifts away from entry-level purchases.” Realtor.com expects sales of entry-level properties to decline, as first-time buyers face obstacles due to higher borrowing costs.
On the bright side for those locked out of the housing market, rents are dropping in the metro area, particularly in locales with a plethora of new apartments. Vacancy rates in the metro area are now 2.87%, up .15% over last year, according to the DMAR. Vacancy rates statewide are 3.1%, compared to 5.3% nationally.
Overall, November’s Denver’s market report seems to offer some good news for both buyers and sellers. Buyers will find many more choices than last year, while inventory is still tight enough to keep prices strong.
As Chair of the DMAR’s Market Trends Committee Jill Schafer notes, December buyers just may find a home on their Christmas wish list, while “sellers should have plenty of money to do their holiday shopping, too.”