The Case-Schiller index provides insight into metro Denver real estate prices and trends. The index tracks the resale prices of single-family homes in the top twenty metro markets, including Denver. It is a closely followed survey that indexes sale prices to those in the year 2000. The index is updated on a monthly basis. The report for December is always eagerly anticipated, because it allows for full calendar year comparisons.
Metro Denver real estate prices increased 8.5 percent at the end of 2012 compared to 2011. To demonstrate how strong a showing this was, no year-over-year gain had been this strong since October of 2001, when prices rose 8.9 percent. The strong showing for 2012 ranked Denver 10th among the 20 tracked metro markets. To a degree, this strength is related to the available metro residential real estate inventories, which are quite low. The new year began with only about 7,000 homes on the market in the Denver area. As a point of reference, at no time has inventory been this low since the 1970s.
Continued low interest rates combine with low inventory to push real estate resale prices higher. With interest rates continuing at near historic lows, a buyer that really wants a given property is often willing to bid a little higher.
Because Denver’s single family home market showed strength before many others, it is not surprising that metro markets that really took a beating, like Phoenix, for example, are showing double-digit gains right now. By contrast, Denver’s market appears strong, but stable. In January 2013, homes that were sold and closed averaged about $300,000 in price.
The Case-Schiller index is published by Standard & Poors. David Blitzer, chairman of the Index Committee at S&P Dow Jones Indices, observed of the national housing market that, “Home prices ended 2012 with solid gains. Housing and residential construction led the economy in the 2012 fourth quarter.”
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