In the Denver Housing Market Update for June 2022, we look back at May and see that the Buyers were in control.
We’ve been saying for many years we are in a seller’s market. Houses are only worth what buyers are willing to pay. That is in any market, buyer or seller market.
This does not mean that whatever a buyer wants a buyer gets. It still takes buyers and sellers to come to an agreement. Sellers, the seemingly endless amount of money has run out.
Again, applications for mortgages have hit the lowest since December 2018.
The increase in interest rates from a year ago makes the cost of buying a house 25% higher than a year ago and the cost of owning a house 55% higher than a year ago.
You are going to hear a lot of people saying a lot of scary things about how the real estate market is stopping, it’s tanking, it’s going to drop drastically.
But what you need to remember is our inventory is still critically low. We had over 3600 active homes on the market at the end of May. To be in an equal market we need 12,000 properties to be on the market.
We are coming out of the crazy Pandemic market and are moving into a more normal market – time will tell. To be balanced we still need 9,000 more homes to be on the market and active. We are up to 9 whole days on the market. We aren’t having as many showings and offers per property. This is good.
June is the time we start saying do not price your house more than the house next door, every year, and this year it is more important than ever. The buyers have more time to analyze your price and they are waiting for you to get real. They aren’t even wanting to look until you are priced right.
Are prices going to drop? We’ll see prices level out first. We’ll see properties stay on the market longer – I remember when 2-3 weeks was normal. The reason prices dropped last time was because we had 30K homes on the market – so don’t panic!
We all needed that past crazy pandemic 2 years to slow down. We aren’t imploding.
If you look at my favorite slide from the Denver Metro Association of Realtors, you’ll see that no matter if we have 30K properties on the market or 2,000 properties on the market, we have between 2 -7000 close each month depending on the time of the year.
I love this chart because it is a reminder, that people’s lives change. They fall in love and buy a house together, they get divorced and need to sell, they die, they have babies, not in that order, the point is – people don’t normally only move based on interest rates as we saw over the past 2 years. People move when they get new jobs, they move when they retire, basically, they move when life changes.
Here are the Denver Housing Market Stats
There were 6,810 properties that came on the market in May, and 6181 went under contract.
5,445 properties closed in May. That’s up from last month and down from the last year, but not by much.
3,600 properties were active at the end of May. That’s up from the last month.
Our average sold price is $714, 495 for May, Down slightly from April.
Thinking about getting into the Denver Housing Market?
If you are thinking of selling I’d love to help you. I just hit my 23rd year helping people just like you make moves to their next adventure.
If you want to buy, I’d love to help you too.
If you’d like to do both and you want an experience like mine, calm, cool and collected because moving isnt easy, message or call me.