Prospective home buyers in Denver have reason to cheer! There are more homes to choose from today than in the past four years. While there still aren’t enough homes on the market to satisfy a city the size of Denver, the active inventory is starting to climb. In fact, since July the active inventory has grown by 7.36%. At the end of August, there were 8,228 active listings on the market. A near 12% increase from the 7,360 homes that were on the market a year ago. Of these active listings, 6,121 of them were single-family homes, which equates to almost 75% of all the listings.
Last month, 6,636 new listings hit the market, far exceeding the 5,073 homes that were sold. The number of homes sold last month dropped by 11.48% from a year earlier. And the average price of all homes sold in August was $478,838. Largely flat from July, but up 9.73% from August 2017. Rising home prices, coupled with rising mortgage rates, have dampened sales in Denver. A 30-year, fixed-rate mortgage is averaging a bit under 4.5%, whereas, a year ago rates were slightly under 4%.
While access to more homes is good news for home buyers, Denver remains a strong seller’s market. There is only a 1.68-month supply of unsold homes. Meaning if no new homes were added to the market and sales stayed the same, all homes would be sold in just 7.3 weeks. And while the months of inventory is up 7.6% from a year ago, rule of thumb indicates a market is in equilibrium when there is 4-month to a 6-month supply of unsold homes.
The luxury market with homes priced at $1 million, remains the one segment that continues to defy the overall trend. There were 191 luxury home sales in August, a stunning 31.72% increase from August 2017. Luxury single-family homes saw an even bigger year-over-year increase, jumping by 37.4%. There were only 5.10 months of inventory for luxury homes in August, a 38.4% drop from August 2017. Indeed, homes priced at the top of the market are the only segment of the market that is balanced.
For the overall market, now is a good time to be house-hunting. Mortgage rates, while no longer at historic lows, are still low by historic standards.