Let’s jump in and see what has been happening since our last communication:
Denver Metro Area Home Report: December
Here we are in a New Year and I’ll be outlining somewhat the same story in the Denver Real Estate market I’ve written about a few times now. Inventory levels have taken their typical seasonal drop off during the holidays and as of the end of December inventory levels were sitting at 5,037 homes that were available for sale. Last year at this time we were sitting at 5,577 homes, so we actually had a reduction in inventory year over year which is a little surprising since we have started trending up over the last year or two with inventory levels. The other sound bite that will sound familiar is of the 5,037 homes active for sale, only 1,399 (or 27%) of them represent homes valued at $400k or lower. We still have a serious tug of war taking place with inventory and affordability with buyers, although buyers have started to become more selective with homes they will purchase. Having your home ready and priced correctly when it comes time to sell will go a long ways in helping for a quicker and smoother real estate transaction. Make sure you have me out ahead of listing your home so we can properly plan and have your home ready!
Here are also some other interesting tidbits of information worth looking at from the recent DMAR newsletter:
- The average number of listings at the end of December historically (1985-2018) sits at 12,941 homes, so we are still way below historical norms for a more traditional market. The highest number of listings for December was set in 2007 which sat at 24,603 homes for sale, and the low was set in 2017 which bottomed out at 3,854 homes for sale.
- The 30 year interest rate on a mortgage has been hovering around 4%, which we were sitting at around 5% about a year ago December 2018. Interest rates still being held low has certainly helped with finding affordable mortgages in spite of the increased real estate prices.
- The average number of years someone owns a home before moving is now up to 13 years vs. 8 years in 2010. People are staying longer in their homes which probably also coincides with lack of inventory and possible moving options Colorado.
- The average worker in the seven-county Denver Metro area can’t afford to purchase a home, again pointing back to the tug of war between affordability and supply.
- Denver rents have increased 88.2% over the last decade and represents the 3rd highest increase out of the 50 largest metros in the U.S. according to a Zillow report.
What should we be taking away from this update? Rents are getting more and more expensive, so while real estate prices have also risen and we still have a competitive marketplace in the $400k and lower price range, interest rates are still attractive if you are considering buying or selling a home as we head into the busy season this Spring.