Record-breaking October adds fuel to Denver-area home market - Denver Business Journal
October marked a continuation of the main themes that have defined the for-sale housing market in the Denver metro since early summer: low inventory, steep competition and rising prices. Active listings across both detached and attached single-family homes at the end of the month stood at 4,821, a record low for October by nearly 2,000 listings, according to Denver Metro Association of Realtors' latest market trends report. But that low level of inventory hasn't yet slowed down the pace of sales. There were 5,984 closed transactions in October, a 16.33% year-over-year increase. November appears poised for another big month, with a record 6,141 pending transactions at the end of October. The pressure among buyers to find a home in this market has resulted in an increase in prices. The median closing price for a detached single-family home was $519,900 in October, up 14.26% from a year ago and 1.94% from September. The median closing price for an attached home, such as a townhome or condominium, was $339,425, up 9.85% from a year ago and 1.32% from September. Not surprisingly, buyers are also having to move more quickly. Homes spent an average of 24 days on the MLS, another record low for October. "Sellers continued to have little to no competition as escalation clauses, appraisal gap waivers and 'as-is' offers were frequently used," said Andrew Abrams, chair of the DMAR Market Trends Committtee and owner of brokerage firm A-Squared Real Estate. "Buyers had to fight tooth-and-nail making concessions in all of the ways referenced above to secure a place they could call home." The market for detached luxury homes (priced at $1 million or above) saw a marked increase in activity with 425 closings in October, up 16.76% from September and 115.74% from a year prior. “Detached homes are the preference for many luxury buyers today who want more land, distance from their neighbors, and multiple private spaces, outside of the bedroom count, that can be utilized as home offices and classrooms for remote learning,” said Libby Levinson, DMAR Market Trends Committee member and broker associate at Kentwood Real Estate – Cherry Creek. “While the luxury market firmly continues as a seller’s market, there is some good news for buyers. There are more detached home choices than last year with new listings up 14.62 percent.” The attached luxury segment is moving more slowly, with 5.7 months of inventory compared to the 1.88 months in the detached segment. Pending sales were down 28.95% from September, although the figure was up 28.57% year over year. “Don’t count the attached market out though,” she adds. “While the months of inventory is a stark contrast to the detached segment at 5.7 months, the year-over-year data proves new listings have steadily climbed from 233 in 2016 to 472 in 2020 and pending sales have climbed from 103 in 2016 to 247 in 2020. While the buyer pool may favor detached homes, the competition is less fierce with the close-price-to-list-price ratio dropping to 97 percent, down from 103.02 percent in 2016.”