The change you’ve been waiting for is here, but it may not be the one you’ve been expecting. Since 2008 and the subsequent recovery, many have been on the edges of their seats waiting for the doom, gloom and yes, opportunity that another bust may bring. Any sign of a change would be welcome as the market and the corresponding burden and chance seems to be wearing weary homebuyers and even sellers down. Alas, we finally have hard data to suggest that while a 2008-era change is not here, a noteworthy one is occurring as this summer market comes to a close.
During July 2018, 7,916 new single-family homes entered the market, up from July 2017’s 7,615. The number of sold homes during the month was also up as was price, hitting a median of $406,000 which was down from the previous month’s $412,000. Though a price decrease could sound some alarms, the $6,000 drop from month-to-month is a seasonal expectation, occurring last year with decreases occurring in July, August and September.
With data provided by the Colorado Association of REALTORS® you may be asking where’s the big change? Though the monthly snapshot isn’t overly telling of this shift, comparing past years’ market peaks, we are evolving toward a much earlier and much shorter one. The number of new homes coming on the market in Denver County specifically, was the exact same as last year, 805 in July, but down from 2016’s 922. The number of sold homes was also down from 2017 and a lot fewer than in 2016 – just over 17 percent less.
Additionally, upon reviewing the timing when, over each of the last three years, the market hit its peaks in number of sold units, we see the biggest change to earlier and shorter seasonality. So far this year, our highest number of sold homes in Denver occurred in May, while in 2017 the peak was June and in 2016, in August. Contrasting that number to February, when new listings statistically begin to rise, the shift suggests we have a new peak season from February to May compared to February through August just two years ago.
When we take a price snapshot of July, the year-over-year prices continue to ascend, but much slower going from 10.7 percent increase over 2016-17 to just over 5 percent from 2017-18.
Overall, a shift of peaks, valleys and growth is occurring. As the entire metro region now sits at 1.9 months’ worth of inventory, double that of January, there is a better home selection available for buyers. Though the seasonality of our market is getting shorter, likely due to concerns over interest rates and attempts by buyers to beat the rush, we maintain a healthy demand as evidenced by the consistently short days on market. Prices are rising still – but slower, much slower as I believe we are still taking those last figurative steps to a summit. How long and boring that summit may be is anyone’s guess but so long as we have a healthy demand, a shortage of balanced inventory and yes, everything this amazing city has to offer, doom and gloom stays far, far away and real estate continues to appreciate.
Matthew Leprino is broker/owner of Leprino Home, Inc. and spokesperson for the Colorado Association of Realtors. He can be reached at: 303.482.1299 or firstname.lastname@example.org