Here’s my September 2013 Denver Metro Market Watch so you know what’s going on.
Trends for Fall 2013 in Denver Metro Real Estate:
# HOMES FOR SALE (INVENTORY ) CONTINUES TO RISE: UP 5.6% FROM LAST MONTH (10,587 Homes For Sale Currently)
- WHAT’S TRENDING: Inventory has trended upwards for 5 straight months now but is still very low compared to the norm. 5,635 homes sold in August 2013 alone which means we have LESS than 2 months inventory right now.
- WHAT DOES THIS MEAN: Whenever inventory is below 4-5 months it favors sellers. The longer inventory stays low the more it weighs in their favor.
- TIPS FOR SELLERS: Make sure buyers are serious. Buyers are bidding faster and faster on homes just to be first…..and I’m seeing more transactions fall through than before. Most are due to buyers moving too fast and then getting cold feet or not realizing details of the home won’t fit their needs. Make sure they are serious before entering into a contract and then the buyer backs out.
- 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! BUT….make sure the home will work for you. Don’t just make an offer because “everyone else” is on the home =)
AVERAGE SOLD PRICE DOWN 1.49% FROM LAST MONTH AND UP 9.35% FROM LAST YEAR
- WHATS TRENDING: Average sold price is $312,418. For some perspective, it was $275,000 in January 2013 and as high as $318,000 in June 2013.. That’s a BIG jump for the first half of this year!
- WHAT DOES THIS MEAN: The market starting to correct itself SLIGHTLY. Buyer’s are not bidding quite as high as we saw a few months ago and prices are “normalizing” just a bit. I personally don’t think this is a “bubble” and I think the price gains we had will maintain. I don’t believe we will see the increase continue like it has, however. This is evidenced by the numbers we see for August 2013.
AVG DAYS ON MARKET CONTINUES TO DROP! NOW= 39 days (DOWN 5% FROM LAST MONTH & 40% FROM LAST YEAR)
- My opinion is that this stat is STILL skewed. New listings that are priced well are selling in about 7 days. Then the overpriced listings and short sales etc are taking 60+ days to close. 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 CONTINUES TO DROP: DOWN 7.7% FROM LAST MONTH BUT STILL UP 20% FROM LAST YEAR
- This is a big stat to watch. I mentioned in my last market update that this if this continues to drop fewer homes sell each month (if this trend continues), the more inventory we will have unless fewer sellers come ON the market. The more inventory we have, the less competitive it is for buyers, which means prices stop increasing. What did we see for price gains in August….and DECLINE!!! I believe this is why. I will keep my eye on this as we move into fall but if you are thinking of selling this fall or next spring, let’s hope fewer sellers come on the market this fall to keep in line with the decrease in buyer demand. If you are a buyer we hope this trend continues and there are even MORE homes for sale and fewer buyers to keep prices low. Personally, I think the first scenario is more likely and we will stay at about 2 months inventory throughout the rest of the year until the Holidays.
INTEREST RATES: I wrote a post on my last newsletter on how interest rates are impacting Colorado Real estate market. Well, today the Federal Reserve announced they WON’T be tapering off the purchase of mortgage backed securities….what this means is interest rates should actually improve. GREAT NEWS for the market and this could lead to a new influx of buyers this fall. I will keep my eye on this and report what I’m seeing in my next update.
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