Housing inventory continues increasing despite typical seasonal decrease, home prices fall and sales of single-family homes priced over $500,000 drop in September.
In September, housing inventory continued to move higher, even though it typically decreases this time of year, and home prices dropped nearly 5 percent since its record-peak highs this past May and June.
“The housing inventory and home price adjustments are normal and expected,” said Steve Danyliw, Chairman of the DMAR Market Trends Committee and Metro Denver REALTOR®. “What’s not normal? Sales of single-family homes priced over $500,000 dropping 33 percent from August to September. For those sellers, that’s real turbulence.”
Looking deeper in the numbers, active listings in the residential market (single-family and condos) finished September at 8,807 total units, up a significant 16.10 percent year over year. The condo segment remains strong, up 21.13 percent year over year. The number of sold listings in the residential market decreased 28.91 percent compared to month prior, and 20.24 percent from last September. Year to date, 42,990 homes have sold - down 3.04 percent from 2017.
The condo market saw a healthy uptick in average days on market, increasing to 24 days compared to 20 last September. The most active price segment for the single-family market in September was the $300,000 to $399,999, and $200,000 to $299,999 for condos.
According to Danyliw, “More signs of cooling can be seen with months of inventory increasing to 2.33 months for single-family homes in September compared to 1.68 months the month prior, and increasing to 1.93 months for condos compared to 1.48 months in August.”
In looking at the single-family home market, the average sold price decreased 3.79 percent month over month to $502,034, while the median price decreased 2.73 percent to $428,000. The year-to-date average sold price stands at $523,224 for the single-family home market, up 9.16 percent from last year, with the median sold price at $445,000, up 8.54 percent. Condos continue to outperform single-family home prices with the average sold price of $350,766, representing an 11.38 percent increase over 2017. The median price of condos sold also increased by 12.34 percent to $299,900.
Our 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), “Premier Market Report” (properties sold between $500,000 and $749,999), and – new to the report - “Classic Market” (properties sold between $400,000 and $499,999). In September, 115 homes sold and closed for $1 million or greater – down 44.44 percent from the previous month and down 4.17 percent year over year. The closed dollar volume in September in the luxury segment was approximately $173 million, down 45.02 percent from the previous month, and down 6.9 percent year over year.
The highest priced single-family home sold in September was $5,100,000 representing eight bedrooms, seven bathrooms and 7,172 above ground square feet in Greenwood Village. The highest priced condo sold was $1,290,000 representing three bedrooms, four bathrooms and 2,397 above ground square feet in Denver. The listing and selling agents for both transactions are DMAR members.
“A lot of luxury homebuyers found what they were looking for this record-breaking summer, leaving fewer of them in the market now that autumn is here,” said Jill Schafer, DMAR Market Trends Committee member and metro Denver REALTOR®. “Sales of single-family homes priced over $1 million plummeted 44 percent from August to September, ending the month with 8.72 months of inventory. Luxury condo sellers may want to make some strategic price reductions with sales down 46 percent compared to the month prior, ending with 17.86 months of inventory.”
According to Schafer, anything over six months of inventory is considered a buyer’s market. Despite a slow month, single-family home sales in the Luxury Market are still at peak levels, up 32.57 percent year to date compared to last year.
Furthermore, year to date, September had the lowest median and average days on market on record and the sales volume was up 27.28 percent compared to last year. Schafer adds, “September 2018 stats were very similar to September 2017, possibly indicating this is just a seasonal slow down.”