The market is SHAKIN’! Low inventory & rising prices are changing the market quickly! Here’s my January 2013 Denver Metro Market Watch so you know what’s going on.
Trends for January/February 2013 in Denver Metro Real Estate:
# HOMES FOR SALE (INVENTORY ) CONTINUES TO DECLINE – DOWN 8% From Last Month & 30% FROM LAST YEAR (7,094 VS 7,706 in December 2012)
- WHAT’s TRENDING: In January 2013, when typically MORE homes come ON the market, the opposite happened. The # of homes for sale DROPPED from 7,706 in Dec. 2012 to only 7,094 in January 2013.
- WHAT DOES THIS MEAN: Last month I mentioned that buyers are clammering to get their offer in first and get it accepted over other buyers & multiple offers are common. Well, this is even more true now as we start off 2013. The bottom line is it’s more favorable for sellers but can be frustrating & emotional for buyers.
- TIPS FOR SELLERS: Leave your home on the market for at least 5 days before accepting an offer to get the maximum sales price
- TIPS FOR BUYERS: Make your highest and best offer FIRST….don’t make an offer planning on a counter or negotiation. If it’s priced well and in good condition….other buyers want it too!
AVERAGE SOLD PRICE DOWN 5% FROM LAST MONTH….BUT UP 11% FROM LAST YEAR
- WHAT”S TRENDING: Average sold price is $275,000. It was $289,900 last month so it’s actually declined slightly.
- WHAT DOES THIS MEAN: Average sold price is an important stat but does not always reflect the pulse of the market. I personally believe higher priced homes don’t sell around the new year because the owners don’t make big financial moves near tax time. It’s also more inconvenient to move around the Holidays and if people don’t HAVE to sell they don’t. People that usually HAVE TO sell are in the lower priced homes so that is my personal opinion for why this dropped. I think for Feb/March stats we will see a HUGE jump in this average sales price.
AVG DAYS ON MARKET = 78 DAYS ( DOWN 25% FROM LAST YEAR)
- What I wish we had a stat for is ACTUAL DOM For all sold homes. If we did, I think we would see that either homes are selling in about 7 days….or they are taking about 3 months to sell. There is a sweet spot with time on market and when you are new you are fresh….and if you are priced well it will sell quickly. If you are WAY over priced, however, buyers still aren’t pulling the trigger on yours. They have learned from the previous crash and don’t want to be “upside-down”….plus appraisers are still being conservative on the values and limiting how much a lender will loan on a home regardless of how much a buyer will pay.
# SOLD HOMES DOWN 13% FROM LAST MONTH BUT UP 20% FROM LAST YEAR
- Active homes are DOWN a lot (almost 30%), but Sold Homes are UP….which is continuing to create the price increases we are seeing. I still believe more sellers will see home values rising and decide to sell…which will then increase inventory levels and possibly normalize the market by later this year.
WILDCARD – ONE THING TO WATCH FOR:
Last month I proposed the “million dollar question”: Will the rapidly increasing New Home inventory levels (and new re-sale sellers to market) match the buyer demand? Will it still fall short and prices will keep rising? Will it surpass the demand and leave us with a glut of inventory going into the end of 2014? My guess (As I mentioned last month)…. as long as rates stay low (which I believe they will) the demand will be there. BUT…inclining prices may create a slow down come mid year as the market starts to correct and builders will overbuild slightly…..causing prices to slow their incline by year’s end.
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