Metro Denver home inventory is in the basement and median closing prices are at an all-time high
Buyers in the Denver metro area can almost always count on more available homes to choose from as the weather gets warmer, but not this year. The inventory of homes and condos available for sale in the area continued to decline last month, despite rising mortgage rates, according to a monthly update from the Denver Metro Association of Realtors.
In a metropolitan area of more than 3.2 million people, only 1,921 homes and condos were available for sale at the end of March, down 5.1% from February and 66.7% from last year. ‘last year. Last month’s drop in inventories was the largest on record for a March month, and the first February-to-March decline the region has seen since 2014.
This came despite a 26.7% jump in new listings from February. Vendors showed up, only to be overwhelmed with demand. A word to frustrated shoppers who weathered the spring inventory surge: It’s not happening. Instead, home prices are rising, further adding to the sense of desperation some buyers are feeling.
“Theoretically, this month’s report shows that if a buyer had only waited a month to buy a $500,000 property from late February to late March, they would have had to pay $35,000 more for that property. said Andrew Abrams, chairman of the DMAR Market Trends Committee and a Denver realtor in comments accompanying the report.
The median closing price for a single-family home sold rose 5.7% from February to $560,000 and is up 15.5% over the past year. The average closing price reached $674,990, an increase of 6.7% from February and a gain of 19.3% from March of last year. Both of these numbers are historic highs.
Median price gains were more modest for condominiums and townhouses, up 4.6% month-over-month and 6.35% year-over-year to 353 $000. The average closing price rose 4.4% and 8.2% respectively to $416,775.
The number of residential closings jumped 24% between February and March and 1.2% over the past year. Half of the listings for single-family homes last month went into contract within four days and received 104.1% of the listing price, two other markers of the liveliness of the housing market.
Rising interest rates, which can reduce affordability and limit demand, could start to weigh more on markets depending on how quickly they continue to rise. Rates on a 30-year mortgage started the year around 2.65% and are now nearing 3.2%, according to FreddieMac.
“If interest rates continue to rise, we could see fewer buyers in the market, leading to a more normalized market. The million dollar question is when?” asked Abrams.