Pandemic wreaks havoc with Denver real estate market

by | Apr 6, 2020 | Blog, Denver Real Estate Market

As the coronavirus swept through America, changing the world overnight, real estate wasn’t immune from its reach.  March statistics for the Denver metro area housing market tell a tale of two realities: one before the virus hit and one after.

The Denver Metro Association of Realtors (DMAR) report for March shows a strong market, with active listings up 19.46% over February, closings up 12.2% and average closing prices reaching record highs of $513,526.

But those rosy numbers don’t reflect the most notable changes of the month: a drastic drop in showings and a sudden retreat from the market by sellers.

According to statistics gathered by Megan Aller with First American Title, the number of showings for March “peaked between the 4th and the 10th of the month.” Once the stay-at-home order was issued by Colorado Governor Jared Polis (real estate remained an “essential business”), showings fell 50.4%.

Meanwhile sellers dropped out of the market in droves. “There were an unprecedented 761 home sellers that withdrew their homes from the metro-Denver real estate market in March,” notes the DMAR report. “The largest number of homes, 625, was removed in the last two weeks of March amid fears stemming from the coronavirus pandemic.” This compares to 284 homes withdrawn in January 2020.

“How quickly our world has changed,” noted Jill Schafer, chairman of the DMAR Market Trends Committee. “At the start of March, the Denver Metro real estate spring market was showing signs of being one of our best on record. By the end of the month, we were all wondering what was ahead for us, our industry and our country.”

While home sales continue, the process has drastically changed. “We are no longer holding open houses, driving with our clients or even riding in the same elevator,” stated Schafer. “We are completing transactions at no-contact, curbside closings with closers wearing gloves and masks.”

Real estate agents are also working with a new contract, dubbed the “COVID-19 Addendum.” For use on pending and current real estate transactions, it allows for transactions to be extended should a buyer or seller be “exposed [to the virus] or quarantined,” according to DMAR.

Meanwhile, Schafer notes that walking through properties has become a last step for buyers, rather than the first. “Virtual tours, videos and FaceTime walk-throughs have become the preferred form of marketing so buyers don’t have to enter properties unless they truly think it might be the one they want to buy.”

When they do show a home, seller’s agents are trying to ensure the safety of home shoppers: for example, leaving all of the lights on and all of the doors open, as well as making sure hand sanitizer and gloves are available.

While we live through what seems like an endless Twilight Zone episode, Schafer reminded real estate agents that this is only temporary.

“We will adapt to the new normal,” she notes, “and when it is all over, Denver will still be a desirable place to live and people will still want to transact real estate. In the meantime, don’t panic, do your part and stay home unless your clients need to buy or sell. We all must do what we can to help stop this pandemic.”

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