Denver Real Estate Market Update: September 2017

jennifer-morrissette-denver-real-estate-market-update-september-2017
We’re seeing some interesting changes in the Denver real estate market update
for September 2017. Click the image above for a short video.

Market Update Highlights

 Of particular interest and worth noting:
  • The number of sold homes is down 8.58% from last year and down 5.79% over last month.
  • Inventory of for-sale homes in the Denver real estate market is slightly up (0.45% over last year and 0.11% over last month).
  • The average sold price of a home in the Denver metro area is $434,478; this is down 2.75% over July.
  • Average days on market is 31. This is 3.33% higher (i.e., longer) than July.
  • The slow-down we’re seeing in home sales in the Denver real estate market is due to the recent increase in rental inventory. It’s impossible not to notice all of the apartments that have sprung up recently. That has driven down rental prices to the point where rent may once again be lower than a mortgage payment. As a result, some buyers are no longer feeling the same urgency as before about buying a home.
  • Denver metro-area home sellers are now considering a wider range of offers. We’re still not seeing any successful offers for less than asking price, but sellers do seem to be more open lately to contingent offers or all loan types (e.g., downpayment assistance, etc.).

Is it Still a Good Time to Invest in Denver Real Estate?

Given what I just shared in my market update, I totally understand why people would ask if it’s still a good time to invest in Denver real estate. They want to know if we’ve hit the top of the market. My information sources and my experience tell me that the market is solid and that investing is still a good idea. Here’s a few reasons why:

  • The Federal Housing Finance Agency has tracked housing prices since 1975. In this linked report from August 22, 2017, you will see on page 35 that home values in the Denver-Aurora-Lakewood area (Denver, Arapahoe, and Jefferson counties) have increased by 368.56% since the first quarter of 1991. In other words, even with the “bubble burst” of 2008, appreciation has more than tripled in our area over the past 25 years.
  • On the same page of that report, you will see that home values in the Denver metro area have increased by nearly 70% in the last five years alone. With all of the companies and people moving to our area, it’s reasonable to expect home appreciation to continue.
  • With that said, I would not expect double-digit appreciation every year. I typically counsel buyers to expect to hold their property for 5-7 years before assessing appreciation.
  • Finally, some of the biggest factors in the “bubble burst” of 2008 were no-documentation stated-income loans with 100% financing and adjustable rates. That was simply too much uncertainty and variability to be sustainable. Thank goodness those days are gone!

Just for Fun: Colorado Symphony Wine Tasting Event on Sep. 26

I’m looking forward to attending “Champagne and Cordials – The Tasting of the Season” at Park Hill Golf Course on Tuesday, September 26 from 5:30-8:00 p.m. I’m eager to try Champagnes from the great producers of France, along with their sparkling California counterparts. There will be hundreds of wines and generous appetizers. Tickets are $30 in advance ($35 day of event). I hope to see you there!

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