The Denver Real Estate Market in February 2023
As real estate in the Denver metro continues to find a rhythm more akin to 2019 and prior, home buyers are using their biggest disadvantage, high mortgage interest rates, to their advantage. Meanwhile, sellers continue being buoyed by low inventory and banked equity to make a tidy profit.
When you break down the data for detached, single-family homes, here's what stands out:
- Buyers are taking time to shop around. Average days on the market now stand at 49, up 250% over 2022.
- If there is wiggle room, buyers are negotiating. On average, homes are selling for 98.8% of asking price. While that's just a slight month-over-month increase, homes sold in February of last year averaged 105.1% of asking.
As for inventory, this is where sellers have a greater advantage.
- In February 2,414 new listings were added to the pool of existing inventory—that's up by 23.8% month-over-month but down 17% compared to last year.
- By the end of the month, 2,656 homes were under contract and 1,902 listings closed, big jumps from the month prior.
- Adding those together, there was movement on 4,558 properties with just 2,414 new homes coming on the market. So, a lack of inventory continues to be an X-factor.
- Accordingly, and despite interest rates, median home prices inched up month-over-month to $600,000.
This pattern repeats when looking at the attached real estate market, condos and townhomes. Pending and closed homes outpaced new listings by 806 properties. Median days on the market decreased from 28 in January to 23 in February while prices increased slightly month-over-month to $400,000. Still, buyers are paying just 99.1% of the asking price compared to 104% a year ago.
Fun fact, the historical average increase in active listings (both detached and attached) from January to February is 0.53%. A decrease of 8.3% this February represents the second largest percentage decrease since 12.6% in 2021.
So, how can the inventory problem swing things more in favor of buyers? Libby Levinson-Katz, Chair of the DMAR Market Trends Committee and Denver Realtor®, had this to say:
"The source for more inventory lies with potential sellers who are contemplating a move; however, if these sellers need to buy another home, they are between a rock and a hard place. Their home is no longer working for their lifestyle, but facing an interest rate that may be more than three percent higher than their current rate is a hard pill to swallow. The good news for these sellers is that we are still primarily in a seller's market."
Without more inventory, it's likely that buyers and anyone selling will experience a busy spring within a stabilized market. Just make sure you have a professional and experienced expert by your side to guide you, advocate for you, and help you achieve your real estate goals.
The Denver Boom: Home Prices Over the Last Decade
While the massive equity gains of the last few years have slowed, now is still a fabulous time to sell—especially if you've owned your home for a good decade. Take a look at the chart below to see how average prices for single-family homes have changed in popular central neighborhoods over the last ten years.
And if you're thinking about selling, feel free to contact a PorchLight agent to get a free, personalized report showing your home's value. You could be sitting on a treasure trove of equity!
