Crazy low inventory.
Active listings in the residential market (single family and condos) were at 3,878 total units in February, representing an all-time low for any month on record.
This is only the third time active listings have dropped below 4,000 units.
Lots of new listings, with even more buyers.
February experienced a surge of new listings with a month-over-month increase of nearly 20 percent, and a year-over-year increase of 6.81 percent. The healthy increase in new listings was squelched by an equally healthy increase of properties placed under contract. Homes under contract increased 17.82 percent from last month, and 4.79 percent from February of last year.
“The spring selling season is off and running as unseasonably warm weather heats up an already hot market,” said Steve Danyliw, Chairman of the DMAR Market Trends Committee and Denver real estate agent. “Adding fuel to the fire is record low inventory and high demand. As prices continue to rise, concerns over affordability will begin to cool things a little.”
According to Danyliw, rising mortgage interest rates will erode buyers’ purchasing power and increase affordability concerns.
Notably, even though the total housing inventory was down last month, condo inventory was up 19.25 percent year over year. Danyliw shares, “The extreme competition was occurring with homes listed under $400,000, causing buyers to become more frustrated.”
In the single-family home market, the average sold price remained relatively unchanged at $447,838 while the median price rose 3.68 percent to $394,000. Year over year, there were 8.59 and 11.38 percent increases in the average and median sales price respectively. The condo market showed 6.92 percent fewer sales than the previous month, while the average and median sales prices rose to $297,610 and $255,000, respectively.
In the Luxury, Signature + Premier Markets:
Luxury Market: Properties sold for $1 million or greater
Signature Market Report: Properties sold between $750,000 and $999,999
Premier Market Report: Properties sold between $500,000 and $749,999.
In February 58 homes sold and closed for $1 million or greater – down 30.12 percent from the previous month, and down 17.14 percent year over year. The closed dollar volume in February in this luxury segment for both single family and condos was $87,426,822, down 34.79 percent month over month, and down 17.14 percent year over year.
The highest priced single-family home sold in February was $3,985,000 representing six bedrooms, seven bathrooms and 7,880 above ground square feet in Cherry Hills Village. The highest priced condo sold was $1,850,000 representing three bedrooms, five bathrooms and 2,521 above ground square feet in Denver (a former church that was renovated into a single-family home.)
“While we didn’t feel much of a winter chill in February, the Luxury Market of homes priced over $1,000,000 did go into a bit of a winter hibernation,” stated Jill Schafer, DMAR Market Trends Committee member and Metro Denver real estate agent. “This still remains the only segment of the market where buyers have the power.”
The number of high-end homes has been dropping over the past few months. The biggest recent drop was in the number of sold homes from January to February, with single-family home sales down 29.73 percent and condo sales down 33.33 percent.
“Despite those drops, the single-family luxury market is still up 5.88 percent year-to-date,” adds Schafer. “However, sales in the luxury condo market appear to be struggling since 250 Columbine in Cherry Creek North has sold out. Sales of luxury condos were down 21 percent year-to-date. Much of that may be due to the lack of inventory. With new luxury condos in the works, we may see some changes in this segment of the market over the next few years.”
Conversely, condo sales in the Signature Market were up 50 percent from January.
“Just like we had record breaking hot days in February, condos in the Signature Market were just as hot,” said Brigette Modglin, DMAR Market Trends Committee member and metro Denver real estate agent.
Days on market in the Signature Market dropped 27.72 percent month over month, and over 56 percent year over year. Home sellers in this price segment are getting over asking price at 100.4 percent close-price to list-price.
For easy reference, here are the stats from last month:
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