The October market data showcases a tale of two markets. according to the Denver Metro Association of Realtors’ Market Trends Committee.
In the first half of the month, buyers were lured back into the market by a brief break in interest rates. Leading up to the highly anticipated Fed rate cut, mortgage rates hit a 19-month low in September at 6.1 percent bolstering sales into October. How-ever, with stronger-than-expected economic data throughout October, rates continued their upward climb, crossing the seven percent threshold by the end of the month. The swift rise in rates created a "pause" effect, amplifying the anticipated election-related paralysis among buyers in the latter half of the month. As such, the following data reflects a more optimistic picture of where the market currently stands.
Closed home sales rose 2.35 percent to 3,443, likely due to the dip in rates within the month of Septem-ber, as homes that went into pending status the prior month closed in October. Sales volume followed with a 7.4 percent increase while pending sales rose slightly by 1.07 percent. This uptick in activity brought months of inventory down from 3.6 to 3.18 months market-wide; however, median days in MLS continued to climb from 25 to 26 days.
Active listings decreased slightly by 1.57 percent due to the increase in pending and closed sales, as buyers absorbed some of the standing inventory. However, active listings are still 46.22 percent higher compared to last year, highlighting that there are simply more options, and it is taking longer to sell a home today. Reflecting on election-related hesitation, new listings decreased by 7.16 percent as sellers delay listing until after the election cycle.
Once election results are finalized, buyers and sellers are likely to refocus on the real estate market. Reflecting on historical data from the past three election cycles, DMAR Market Trends Committee member Michelle Schwinghammer noted, "In the 11-county Denver metro area over the last three election cy-cles, we've seen more month-to-month home price volatility leading up to an election, followed by increased price stability and a return to traditional seasonal patterns post-election. Once results are in, buyers and sellers tend to shift back to business as usual."
Anecdotally, many Committee members reported an increase in sellers preparing to sell their homes in the new year. If the Federal Reserve does lower rates this month and again in December, we may be set on a path for a strong 2025 as conditions normalize and home prices stabilize post-election.
Learn more about the market from the Denver Metro Association of Realtors.
