The ever-present rain and hailstorms in June did not dampen the Denver real estate market. While activity was noticeably slower than last year, buyers and sellers came together to navigate a changing marketplace, says the DMAR Market Trends Committee.
Bidding wars were down considerably, with the close-price-to-list price ratio at 100.23 percent market-wide. Some homes are still selling in a weekend with multiple offers, but many more are sitting on the market for a few weeks with one or two price reductions before finding a buyer. The days of routinely putting a home on the market and watching it sell to the highest bidder in days are gone.
One reason bidding wars are down is because buyers are far more discerning. They want to negotiate and feel as though they are getting a win in a landscape with rates hovering around seven percent and construction costs soaring.
Speaking of high construction costs, homes that need work are languishing on the market. I had a property with all the capital improvements a buyer could want- a new furnace and A/C, a new water heater, updated electrical and plumbing and newer windows and solar panels that are owned outright. However, it took time to sell as buyers couldn't get past the fact that the kitchen needed some updates. Buyers want homes that are as close to perfect as possible in direct relation to price.
Active listings at month end steadily increased month-over-month this year, short of a slight dip in February, to 6,070.
This is an increase of 16.11 percent from May and the highest the market has seen since 2020. One contributor to the growing active listings is an increased number of deals falling at inspection. Sellers are taking note and willing to work with buyers who are keen to walk from a deal if there are any hiccups with inspection or appraisal.
While buyers are perhaps a bit skittish due to rate pressure, the DMAR Market Trends Committee is reporting increased activity at open houses across the city. These visitors, not ready to jump into the market yet, are instead opting out of the rate game and waiting on the sidelines while rental rates are still attractive. The important key here is that there are many would-be buyers out there who will be ready to jump in once rates start to decline. Now if only we had a crystal ball and could determine when that may be!
With growing inventory and activity slowing, it looks as if we are heading toward a normalizing market. This is great news for buyers who have a bit more control in this market. While sellers are less excited, it's important to counsel sellers that it may take a bit more time for their homes to sell. With the newly expanded report, review page 14 to determine the months of inventory for various price bands. Sellers are learning patience as buyers set the market, and at the moment they aren't rushing into any decisions
Learn more about the market from the Denver Metro Association of Realtors.
Thank you to our partners at the Denver Metro Association of Realtors for compiling this information.
If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.
