The Denver housing market is easing considerably, however the challenges for consumers stay | information
While the housing market in the Denver metropolitan area has cooled slightly in recent weeks as more potential buyers have turned their attention to the vacation, a panel of real estate experts said Tuesday won’t be much of a relief for buyers anytime soon.
“We have a rapid escalation scenario underway,” said Charlie Farrell, CEO of Northstar Investments.
The Denver Gazette and news partner 9News hosted a panelist video conference discussion on Tuesday entitled “Surviving the Overheated Housing Market.” Farrell joined real estate agents Jenny Usaj of USAJ Real Estate and Lydia Lin, owner / operator of ONE Realty, as well as Matt Rankin, vice president of operations at Taylor Morrison Homes and Dan McMahon, home finance director of the Colorado Housing and Finance Authority (CHFA).
“In Denver last year, we had the perfect storm on our residential real estate market,” Usaj said. “The interest rates were low. People who made Zoom calls from their closets wanted more space and focused on their home. When the whole city closed, people were at home and in their backyards and the focus shifted to improvement. “
That, in addition to the influx of new residents who wanted the Colorado quality of life when they could work anywhere, created tremendous demand. The home stock has declined over the past year and more, while home prices continue to skyrocket – an “extreme market” is emerging.
The latest figures from the Denver Metro Association of Realtors paint a pretty clear picture: The average closing price for detached single-family homes rose to $ 700,559 in May, up 29% from May 2020. Meanwhile, the inventory of homes for sale has dropped to just still . down 2,075 active advertisements at the end of May. That is 20% less than in April and 71% less than in May 2020.
“We built up as much inventory as possible,” said Rankin of Taylor Morrison. “We sold 30% more houses than we were able to start last year.”
Part of that delay in new inventories was due to skyrocketing timber prices, the February freeze in Texas that delayed items like PVC pipe, and a labor shortage, Rankin said.
It didn’t help that institutional investors got hard into Denver’s market, sometimes snapping up homes that first-time buyers would have snapped, Farrell said.
“They’re looking for returns, and residential real estate has done very well,” said Farrell.
The panelists gave their best tips for navigating the challenging market.
Usaj said it can help to search suburban markets in addition to being patient and waiting for that one listing that may have been on the market longer than others.
“There’s been a big shift in priorities,” she said. “It used to be several bedrooms and bathrooms. Now everything revolves around the backyard and the outside area. … The market for condominiums or terraced houses is also a little less hectic in some areas. “
Lin even went so far as to recommend certain neighborhoods, particularly in southwest Denver like Ruby Hill, Harvey Park, Westwood, and Lakewood.
“Lakewood is crushing it right now,” Lin said, adding that being creative about down payment sources – including parenting issues – could also help.
“Come on,” said McMahon. “We don’t have a housing market in Colorado – it’s all about neighborhoods. Some homebuyer training is important. Take the time to understand what it takes to buy a home, including the budget. “
McMahon said be sure the research is down payment aid for first time buyers, veterans, etc.
Farrell reminded buyers to get their credit checked ahead of time and fix any issues before entering the market.
“You don’t want to take this exam if you’re making an offer,” he said. “You have to work well in advance.”
Viewers can view the full video replay of the panel discussion here.