Denver RE Demand Continues to Surge

Here are the August stats for the 7-county real estate market courtesy of REColorado and SMDRA—
Remember Covid was still impacting our real estate market last year as showings, pendings, and solds dropped substantially March thru May and our market played catchup during June, July, and August.

· 5,579 properties sold and closed last month, down 9.4% from last year when sales were higher than normal in the summer due to Covid. Versus 2019 sales were up 5.2%.
· 1,670 attached homes sold last month, down 4.8% from last year, but up 5.4% from 2019.
· 3,909 detached homes sold last month, down 7.4% from 2020, but up 5.2% from 2019.
· In August, we saw 5,686 new listings, down 10.8% from last year and down 8.1% from 2019.
· We saw 1,763 new listings of attached homes, down 10.9% from last year and down 9.5% from 2 years ago
· We saw 3,923 new listings of detached homes, down 10.7% from last year and down 7.5% from 2 years ago.
· Buyers placed 5,969 properties under contract last month down 7.2% from 2020, but up a large 17.8% from 2 years ago.
· The average closed to original list price ratio dropped to 102% overall, down from 103.7% from July and dropped to 102.3% for detached homes. This was down from 104.2% in July and the peak of 105.8% in May and June.

· We ended August with only 3,078 properties for sale, down 40% from last year and down astonishing 63% from August 2019.
· This puts inventory at 0.55 months or 16.5 days.
· Average Days in Market was 11, down 50% from last year and down 63% from 2019.
· Median Days in Market was 5 days, down from 6 days last year and down from 14 days in 2019, this is a 64% drop.
· But, median days in market had been 4 days the last 5 months.
· Median Days in Market was below 20 days on all price ranges under $2 million.

· The average sales price in August was $609,313, up 15.7% from last year and up 27.9% from 2019.
· The average sales price of an attached home was $436,905, up 16.7% from last year and up 18.4% from 2019.
· The average sales price of a detached home was $682,969, up 15.9% from last year and up 30.8% from 2019.
· The median sales price in August was $530k, up 16.5% from last year and up 26.2% from 2019.
· The median sales price of an attached home was $370k, up 13.9% from last year and up 19.6% from 2019.
· The median sales price of a detached home was $580k, up 16% from 2020 and up 28.8% from 2019.

I looked at a chart that shows closed sales prices by price range for the last 5 years and I looked at the chart vertically instead of horizontally as it prints out. This was remarkable to look at. Here is what I saw—
· The number of properties sold in the $200’s has dropped by 68% from 2017.
· The number of properties sold in the $300k’s has dropped by 56% from 2017.
· The number of properties sold in the $400k’s has increased by 20% from 2017, but are down 20% from last year.
· The number of properties sold in the $500k’s has increased by 115% from 2017.
· The number of properties sold in the $600k’s has increased by 175% from 2017.
· The number of properties sold in the $700ks has increased by 213% from 2017.
What does this mean?
· In 2017 a “normal” home sold in the $300’s.
· In 2020 a “normal” home sold in the $400’s.
· This year a “normal” home sold in the $500’s. We saw 1,151 properties sell in the $500k’s last month.
· Soon a “normal” home will be selling in the $600’s. This August we saw 755 properties sell in the $600k’s.

My Thoughts & Comments

· 2 years ago I never could have imagined only having 3,000 homes for sale in the summer time.
· As a statistics geek its flipping remarkable that active listings are down 63% from the low levels of 2019. Normally a 10% to 15% change is huge; but a 63% change stuns me! Especially when you consider we only had a 8300 homes for sale 2 years ago.
· Closings are up a solid 5% from 2019 and pendings are up 17.8% from 2 years ago. This tells me demand is NOT FALLING. IGNORE THE MEDIA AND THE NAYSAYERS.
· Unfortunately supply or new listings is dropping at the same time, down about 8% from 2 years ago. Thus, inventory levels have dropped considerably. In fact, in August 2019 we had 1.57 months of inventory.
· Price increases have moderated thankfully from their 20%+ levels earlier this year, down to just 16%. And median prices increases were higher than average which is a sign of a “healthy” market.
· I expect home price increases will remain in the double digits this year, but hopefully moderate to just 10% to 12%.
· Average sold prices of detached homes are up an amazing $160k from 2019.
· Median sold prices of detached homes are up $130k from 2019.
· New listings in August the last 9 years averaged 6,051 and this year’s total of just 5,686 is concerning. This was the 3rd fewest new listings we have seen in August in the last 10 years.
· From 2012-2019 we had seen average of 5,131 properties sell in August. This year we saw 5,579, the second highest total except for Covid impacted 2020.
· What happens when have fewer new listings and more solds? Prices increase rapidly.
· Finally, since last June we have had less than 1 month of inventory, which is now 15 consecutive months. Holy Cow!!! What’s going to cause this to change? This will be the subject of an upcoming video that I recently recorded and will be on my YouTube page.