Buyers struggling in the tight Denver housing market found some relief in May, when active listings jumped nearly 25% over April. That number represents a three-year high for the month, according to the Denver Metro Association of Realtors’ (DMAR) monthly housing survey.
DMAR reported that there were 6,437 homes on the market in May—a 9.19% rise over the same time last year.
While more inventory often leads to lower prices and longer selling times, this hasn’t happened in the metro area. DMAR stats show that the market is still sizzling.
Homes sold with lightning speed, spending a mere 18 days on the market in May, “which ties a record-low for any month,” said Steve Danyliw, chairman of the DMAR Market Trends Committee. And prices continue to rise. The average home sold for $490,355 in May, a slight increase over April, but a 11.37% jump over May of 2017.
As a result, many potential buyers continue to be priced out of the market. The DMAR report cites a study from ATTOM Data Solutions that shows that the “average worker in 10 of 11 Colorado counties analyzed, including six in Denver metro, can’t afford a median priced home in the area.” Former risky neighborhoods, such as Five Points, Baker, Highland and Jefferson Park, now have a higher median home value than the city overall.
While the high prices always spur worry of a housing bubble, Danyliw assuaged any concerns that the market has peaked. He points out that current market conditions vary significantly from the housing bust in 2007-2008. At that time, he notes, there were more than four times as many homes on the market—29,110. And “economic conditions like employment, job growth and net migration are stronger today that 2007-2008,” said Danyliw,
Meanwhile, Denver continues to attract newcomers who help fuel the market. According to a study by MagnifyMoney, a credit card search company, Denver is number three on the list of the top 50 cities in which to retire. With the city ranking high in many other surveys, more migration seems assured.
In sum, the market should remain strong in the coming months. As Danyliw notes: “I don’t see a bubble any time soon…”