Is Our Housing Market Changing?
Statistics project demand will remain high, but inventory is showing signs of change
Everybody wants to know when the market is going to change. When will buyers once again be in control of price, time on market, inspection objections and ultimately, their ability to be picky? When will the era of sellers dictating the majority of the terms end and allow us to return to a middle-of-the-road commonality where disbelief isn’t the prevailing emotion in this, our rollercoaster of a real estate market?
The answer – not anytime soon.
According to new numbers released last week by the Colorado Association of REALTORS®, for the first time in nearly two-and-a-half years, we are reaching new inventory highs in the number of homes coming to the market –1,054 for single-family alone in the month of May. This may not seem like a profound amount, but when you consider that December 2017 had just 305 new listings, and the last time we were north of 1,000 was June 2016, there is a change coming to those who have been waiting to throw their home in the ring signaling more options for buyers than they’ve had in nearly two years.
The reason I suggest that the change from seller-control to buyer is not around the corner is that, despite this uptick in inventory, the demand in our fair city has shown absolutely no signs of slowing. Like previous Mays, the average home sold for 100.9 percent of asking price. Those same years showed homes selling for 101.2 and 100.5 percent, respectively. This suggests that, despite our positive inventory news, the demand is virtually unchanged.
Median price is also up from May ’16 and ’17 to $504,750 for the seven-county Denver metro area, but down from $512,000 just last month. That number is much higher in Denver proper at $594,087.
Those who are waiting or don’t want to wait to enter the market until things calm down may want to consider the statistics which project that demand will remain high. Inventory, though showing signs of change, is still at historic lows nationwide and locally while interest rates are beginning their ascent from their own historic lows. The cost to buy a home in our city is drastically different today than it was only a few years ago – an incredibly hard pill to swallow for many of us natives – but the change, albeit large, shows no sign of being temporary.
We live in an incredible city that we once relished as a very well-kept secret. We must now accept that the cat’s out of the bag and adapt our way of living while knowing that despite everything, owning your own home is the single best investment many of us will make in our lifetime.