According to a just-released report from the Denver Metro Association of Realtors, the Mile High City's 2020 housing market, which some experts thought would crater amid the COVID-19 pandemic, is now expected to out-perform the market in 2019. Moreover, prices have actually risen in recent months, with the average cost for a single-family home in greater Denver hitting $606,330, a new record, in August.
How the hell has this happened? The strength of the market prior to the arrival of the novel coronavirus and the attendant rarity of foreclosures have a lot to do with it, as RealtyTrac's Rick Sharga explained ina September 3 post about bad news for bargain house hunters. But also key is the simplest of economic factors: the law of supply and demand.
The report's data snapshot compares the availability of properties on a month-to-month and year-to-year basis. According to the latest statistics, there were 5,496 active listings for attached or detached residential houses in the metro area during August, down nearly 1,000 from the 6,449 in July and way below the August 2019 total of 9,350.
The contrast is even more profound when detached properties — stand-alone homes — are considered separately. At the end of August, active listings for these stood at 3,350, a big drop from the 4,001 in July and less than half of the 6,645 available in August 2019.
The bidding wars that have sprung up have led to the price spikes, as seen in this DMAR graphic:
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Sticker shock didn't scare off many buyers, though. Indeed, DMAR notes that home sales last month were the highest of any August on record.
Granted, sales were actually down by 18.73 percent in August compared to July, and prices for condos were lower, too, even while they rose by 2.58 percent over the same period last year. But the total sales volume was up by 3 percent from August 2019, pushing past the $20 billion mark.
Luxury homes going for more than $1 million are much more available than those tagged between $500,000 and $749,000. Based on the mid-price properties available, notes a statement from DMAR market trends committee member Drew Morris, "we could be out of homes for buyers to purchase in two to three weeks if no other inventory hits the market."
And you thought things were bad now. Click to read the Denver Metro Association of Realtors' September 2020 market trends report.