This past month, many people celebrated Independence Day by watching fireworks, enjoying a barbecue, or perhaps escaping to the mountains. This year, Denver’s continued robust housing market was another cause for celebration. The Denver Metro Association of Realtors released its latest report on home sales activity in the metro area on the 4th of July. The report found the local housing market remains strong. While home prices are appreciating at a slower pace than in recent years. That is good news for prospective buyers, who on average are no longer facing double-digit price increases. At the same time, sellers are still enjoying solid increases in the value of their homes.
The average price of a single-family home sold last month set a new record of $539,934. That is less than a 1% increase from May and an 8.75% increase from June 2017. When you throw condos and town homes into the mix, the average price of all homes hit a record of $492,029, up slightly more than 1% from May and an 8.8% increase on a year-over-year basis.
Buyers also have more homes to choose from in June than they did in May. There were 7,436 active listings on the market in June, up 15.52% from May. Such a big percentage increase from May is not unusual. This time in 2017 and 2016, for example, the month-to-month percentage jumps were about 20% and 24%, respectively. Year-over-year, the number of active listings increased by 5.34%. The last time more active listings were on the market was at the end of June 2014. At that time, there were 7,791 homes on the market.
The number of homes placed under contract also picked up a bit in June. There were 6,043 homes placed under contract in June, a 2.46% improvement from May and a similar increase of 2.55% on a year-over-year basis. In the first half of the year, 37,311 new listings came on the market. That’s a 1.45% increase from the 36,779 new listings in the first six months of 2017.
Sales activity in the first half of the year was not bad considering rising home prices and interest rates. There were 27,228 total homes sales in the first six months of 2018. Which is a 3% drop from total sales in the first half of 2017. The average sales price of all homes in the first half of the year was $476,100, a 10.47% percent jump from the average sales price in the first half of last year. Despite the dip in sales, thanks to higher prices, the total sales volume in the first six months of the year hit a record $12.96 billion, a 7.08% increase from $12.1 billion in the first half of 2017.
Yet, the market remains tight. There was only a 1.43-month of inventory of single-family homes available to buyers at the end of June. That translates to slightly more than 6-week supply, which, believe it or not, is almost an 11% increase in MOI from June 2016. For homes priced from $200,000 to just under $400,000, there was less than a one-month supply of homes on the market. The luxury housing market is the most balanced of all markets, with a 4.64-months of inventory of homes priced at $1 million or more. That is about a 17% drop in the MOI for luxury homes.
Kentwood Real Estate broker and DMAR Markets Trend Committee member Jill Schafer described the luxury market as “astounding.” In the first six months of the year, a record 978 luxury single-family homes were sold, a 32.52% increase from the same period in 2017. The sales volume of luxury single-family jumped 32.6% from a year earlier to $1.486 billion. The total sales volume for luxury hit $1.63 billion, when including luxury condos.