Market Sending Mixed Signals
August 24, 2016 | Market Trends
The metro Denver real estate market might be signaling a shift if you take a short-term view. For the 2nd month in a row, fewer homes sold.
For July 2016 compared to July of 2015, the number of homes sold declined by 11.9% even though home prices are up by 10.46% over this time period. The inventory of homes available for purchase remained unchanged.
This is similar to the pattern we saw in June where prices continued to climb even though fewer transactions were occurring.
A longer-term perspective gives a little different take. While the last two months have shown fewer closed sales than last year, the year-to-date situation is almost identical to the first seven months of 2015. We’ve had 29,038 closed sales so far in 2016 compared to 29,895 through July in 2015. The first seven months of 2014 had 29,082 closed sales.
The bottom line is that the supply and demand patterns have been very similar for the last three years running. While any given month may show numbers either higher or lower compared to the same month in the prior year, these short term variations have balanced out to produce remarkably similar stats over the course of a year.
As is so often the case, both perspectives are important and valid in different ways. On the one hand, we don’t have enough data to suggest the market is making a change in overall direction.
The shorter-term perspective is very important, however, for current buyers and sellers. Over the last 60 days, we’ve noticed a die down in the multiple offer mania that has characterized the market for the last few years. Sellers are having to be more flexible and less demanding on price and terms, although they are getting significantly more money this year than last year. At the same time, buyers have found life easier as they aren’t always competing with other buyers and don’t have to make a lot of contractual concessions.
Here’s the summary of market performance this July compared to July of 2015:
The stats above are for sales activity in Adams, Arapahoe, Broomfield, Denver, Douglas, Elbert and Jefferson counties. It includes home sales handled by real estate agents though Metrolist/REColorado®, Inc., the MLS system serving the metro Denver area.
You can see a more extensive breakout between the single family and multi-family segments of the market by clicking on the links at the end of this post. Be sure to take a peek.
If you like the look of those reports, we can produce one for you that is specific to your zip code and property type. The market is not uniform. Your part of town may be doing better or worse than the metro-wide averages.
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