The Denver Metro Area Housing Market is Showing Some Signs of Cooling
Last month, several numbers dipped into the negatives. While it is expected to see numbers decrease, even in a “hot market,” what is considered normal seasonal change and what is not?
“Like the weather, July’s housing market remained hot, but some signs of cooling are in the forecast,” said Steve Danyliw, Chairman of the DMAR Market Trends Committee and metro Denver REALTOR®. “This housing market is filled with shades of gray, some good and some creating areas of mild concern.”
Inventory experienced a slight increase of 4.15 percent from last month. Even with this increase, 2017 represents a new record-low July with 7,352 listings. The number of sales dropped 19.66 percent from June, which is significantly higher than the normal seasonal decrease of five percent. Like sales, under contracts also experienced a higher-than-usual decrease from June of 14.78 percent. A decrease of 6.2 percent is considered normal.
“While the decrease in sold listings may raise some concerns, those concerns can be mitigated, as year-to-date sales are still up 4.69 percent, compared to 2016,” added Danyliw.
By the numbers month-over-month, active listings in the residential market (single-family and condos) totaled 7,352 units in July, while the number of sold listings decreased by 19.66 percent, compared to the previous month.
Condo inventory continues to outperform single-family, up 11.42 percent year-over-year with single-family down 4.76 percent. Like last month, the most active price segment for single-family was $300,000 to $399,999 and $200,000 to $299,999 for condos. Both price segments remain extremely competitive as months of inventory sits below 0.8. The condo market showed 18.08 percent fewer sales than the previous month, while the average and median sales prices dropped to $324,187 and $275,000, respectively.
For the single-family home market, the average sold price increased 1.89 percent to $496,382 while the median price dropped 0.77 percent to $420,000. Year-over-year, there have been 8.43 percent and 7.97 percent increases in the average and median sales prices, respectively. Through July, the single-family market has sold 7.91 percent fewer homes compared to the same point last year.
The monthly report also includes statistics and analyses in its supplemental “Luxury Market Report” (properties sold for $1 million or greater), “Signature Market Report” (properties sold between $750,000 and $999,999) and “Premier Market Report” (properties sold between $500,000 and $749,999). In July, 162 homes sold and closed for $1 million or greater – down 22.49 percent from the previous month and up 19.12 percent year over year. The closed dollar volume in July in the luxury segment was $249,386,688 down 20.69 percent from the previous month, and up 22.13 percent year over year.
The highest priced single-family home sold in July was $4,800,000 representing four bedrooms, six bathrooms and 6,175 above ground square feet in Cherry Creek. The highest priced condo sold was $4,950,000 representing four bedrooms, five bathrooms and 5,171 above ground square feet, in Denver. Both the listing and selling agents for the two transactions are DMAR members.
“Luxury home sellers may have been checking to see if their doorbells still worked after a major slowdown in July sales,” stated Jill Schafer, DMAR Market Trends Committee member and metro Denver REALTOR®.
Year-to-date, 27.13 percent more homes priced over one million dollars have sold. In fact, the luxury single-family home sales volume is up 76.76 percent over the past five years. Luxury condo sales took an even bigger drop in July, down 34.78 percent from June. Year-to-date, Luxury attached single-family homes sales were up 73.33 percent. These high-end attached homes have been a hot spot over the past years with sales volume up 129.71percent since 2013.