April Quick Stats
Denver Metro Single Family Housing Stats:
Active Listings: 8,353
· Down 40% from Apr. ‘11
Under Contracts: 4,622
· Up 19% from Apr. ‘11
· Up 15% from Apr. ‘11
Average Price: $298,712
· Up 10% from Apr. ‘11
Average Days on Market: 90
· Down 17% from Apr. ‘11
Denver Metro Condo Housing Stats:
Active Listings: 1,901
· Down 52% from Apr. ‘11
Under Contracts: 1,059
· Up 22% from Apr. ‘11
· Up 9% from Apr. ‘11
Average Price: $178,231
· Up 12% from Apr. ‘11
Average Days on Market: 91
· Down 26% from Apr. ‘11
Real Estate News
Holy moly! The metro Denver real estate market is in a frenzy with the strongest sellers’ market in more than a decade. As our inventory of homes for sale has plummeted and the economy plods along towards recovery we find ourselves with a huge imbalance in supply and demand: too many buyers and not enough sellers. The numbers speak for themselves:
· The inventory of houses for sale is down 40% over this time last year
o Inventory dropped another .7% from last month’s already super low level
· The inventory of condos for sale is down 52% over this time last year
· The price of the average home is up a whopping 11% over this time last year
o Prices leapt 5.2% in just the past month
· The number of properties under contract is up 19% over this time last year
· 55% of homes on the market are currently under contract – a level not seen since the 1990s
This is one of those be-careful-what-you-wish-for scenarios. A few years ago we were bemoaning the fact that we had a flood of inventory that we couldn’t sell. Sellers were frustrated because their properties would languish on the market. Buyers were extremely picky because there was so much inventory and so little urgency to buy – everybody figured the inventory would stay high for a long time and prices would keep trending downward.
Well, the tables have turned and now it’s GO time. When I take a listing anywhere under $400,000 I look at the sold comps to give me an idea of what properties in the area sold for in the past 6 months. Next, I look at the active listings in the area, which more accurately describe the market at this moment in time. But to get to a final price I then sometimes add $10,000 or $15,000 MORE to the asking price than the comps would justify just because it’s such a blistering market! Why not? There are more buyers than we know what to do with and my last several listings have all had multiple offers above asking price. The market is actively testing the ceiling on prices and so far we haven’t hit it. Demand continues to outpace supply and prices are lurching upward as a result.
The moral of the story is this is a once in a decade market with sellers testing the upper limits of prices and buyers are willing to pay. Call me if you’re considering a move so I can explain in more detail what’s happening right in your neighborhood.
Buyers today are facing a new reality in the marketplace. For the past several years there has been a surplus of inventory making it a buyers’ market. Buyers could afford to be very finicky since there seemed to be an endless supply of properties coming on the market. No more. As you see in the graph, our inventory is at its lowest point since 1995. And since our population is 25% higher than it was in ’95, it turns out we have the LOWEST INVENTORY PER CAPITA EVER in our market. This means that now more than ever buyers need to be well prepared and work with a capable real estate agent to find the property that’s right for them.
Take a look at the graph below. What it shows is the result of the stunning sellers’ market we’re experiencing. With demand far outpacing supply it should be no surprise that home prices are rising quickly. The average home price in April the past four years was about $266,000, ranging from $251,000 to $275,000. The average home price for April 2012 was $299,000! So if you’ve been hesitant to put your property on the market now may be the time. Feel free to give me a call to discuss your situation and I can create a detailed Comparative Market Analysis on your home and let you know what your home is worth in today’s market.
Sellers are not the only ones taking advantage of today’s low inventory and rising prices. Savvy investors are getting in on the game as well. Gone are the days when a fix and flip might sit on the market for months unnoticed. Today’s remodeled properties are selling especially quickly because while the inventory of all homes is very low, the inventory of quality, remodeled homes is much lower still. Fully 35% of the inventory in metro Denver is distressed, meaning bank owned or shortsale properties. Distressed property is almost never in move-in ready condition. So, investors with nicely rehabbed properties are selling quickly and for the best premium as buyers flock to their properties. At Your Castle, 35% of our closings are for investors so we have a great deal of in-house tools and expertise to help you along. If you’re interested in investing in real estate call me and we can discuss the many different strategies and styles of real estate investing.
YCRE in the News
Your Castle takes great pride in being a thought leader on the subject of metro Denver real estate. As such, our agents, managing brokers, and owners are often quoted in the press on the state of the local real estate market. 5280 Magazine’s May 2012 edition had an in-depth analysis that we were glad to contribute to. It’s a great article and worth reading. Here’s an excerpt: “Although the worst of the foreclosure crisis is probably over, banks are still sitting on countless repossessed homes nationwide. It’s frustrating buyers, sellers, and brokers alike, especially in a relatively strong market such as Denver. ‘Right now we have about 10,000 properties on the market; four years ago we had about 27,000,” says Charles Roberts, a co-owner and managing broker with RE/MAX Alliance. ‘Our inventory is down 39 percent from last year for single-family homes, and more than 50 percent for condos. It’s a dramatic change, and it’s driving everything right now.’”
Mortgage rates are continuing to stay at the lowest points in history and it remains a great time to buy. In a recent news story we learned that home affordability is at an all-time high. The home affordability index indicates that right now you can buy MORE house for LESS money than any time in Denver history. The combination of low interest rates plus low home prices are making this a great time to buy and a great time to take advantage of a new mortgage.
Located between Broadway, Downing, Alameda, and Speer, the Byers neighborhood was named for William N. Byers, the founder of Denver’s first newspaper, the Rocky Mountain News. Byers offers city living in a neighborhood of small apartment complexes and single family homes. It’s within walking distance of beautiful Washington Park and also just a few minutes car ride to downtown Denver and Cherry Creek shopping and cultural events. Residents love being close to the famous independent Mayan theatre and an ever growing assortment of second-hand bookstores, art galleries, shops, boutiques, funky bars and high-end cuisine.