Forget about March Madness. Last month was March Gladness, if you were a home buyer in the Denver market. In good news for homebuyers and Realtors, the number of active listings rose by 26.9% from February in March. While it’s not uncommon for the inventory to rise as the spring season kicks in, the increase was twice the 13.1% in the same period in 2016, according to data released by the Denver Metro Association of Realtors. The total number of homes on the market rose almost 10% from the active inventory in March of last year.
Still, with fewer than 5,000 total homes on the market last month there isn’t enough to meet demand in a bustling market the size of Denver. That is apparent in that the months of inventory stood at 1.21 months at the end of March, virtually unchanged from 1.23 months a year earlier. Yet, the increase of inventory bodes well for even more homes to hit the market later this spring and summer. In the first quarter, there are almost 10% more actively listed homes on the market than in the first three months of last year. It’s also important to note that more than 15,000 new listings hit the market in the first quarter of this year, almost 10 percent more than were added to the market between January and March of 2016.
One area that showed a big improvement is luxury homes, or those priced at $1 million or more. At this time last year, the market was saddled with almost a 10-month supply of luxury homes. Since then, the inventory of luxury homes has dropped 24.4% to 7.41 months. While a 24% change is a big drop, those shopping for high-end homes still have a lot of choices, compared to any other price point. In fact, a recent Kentwood Real Estate analysis of the luxury market showed 110 single-family homes traded hands last month, a record for any month of March. That marked a 66.7% jump from March 2016!
Meanwhile, the average sales price of all single-family, detached homes sold in March rose to $425,607. That’s an 8.82% increase from March 2016 and a 6.18% increase from February. The average price of a condo at $317,402, marked the first time in a March that the price topped $300,000. Condo prices are up 10.71% from a year earlier and on a month-to-month basis rose 7.26%. The total sales volume of all homes last month was $1.85 billion, a 9.73% increase from a year ago and a whopping 44.42% jump from the previous month. If you have been waiting for home prices to drop before you buy, reconsider that strategy.
The March and first quarter statistics show that even with a rising inventory, prices continue to rise, a testament to strong demand in a growing economy. If you wait to buy, you are likely to be faced with higher prices and higher interest rate.