As 2016 comes to a close, the report spotlights how the hot real estate market fared this year, experiencing both record highs and lows.
In July, Denver-metro hit an all-time high for the average sold price of a home at $420,178 and median sold price at $365,000. February marked a record low for month-end inventory at 3,963; comparatively, the all-time high was in July 2006 at 31,989 listings.
“As we spend time with friends and family enjoying all the turkey and trimmings, we also give thanks to another hot summer selling season,” said Steve Danyliw, Chairman of the DMAR Market Trends Committee and Denver real estate agent. “In reflecting on the good and not so good of our summer housing market, the question on the mind of many REALTORS® today is how long will this market last?”
Looking forward into 2017, the Trump administration may impact the housing market. Housing interest rates have already seen a slight increase since the General Election which some are calling part of the “Trump Bump.” According to Danyliw, interest rate increases in Denver-metro could price out first-time homebuyers. Also, the Dodd-Frank act, which established the Consumer Financial Protection Bureau, is seemingly in the crosshairs for repeal or more likely a significant re-work. Additionally, Fannie Mae and Freddie Mac may transition from a government-sponsored enterprise to a completely privatized organization.
Emerging as a new trend is the increase in Notice and Demand (NED) filings. In November of 2010, 33.5 percent of the sold properties were distressed sales (i.e. REO, HUD and short sales) compared to 0.3 percent last month.
“We would be hard-pressed to go any lower,” comments Danyliw. “With that said, NED filings are on the rise. Denver has experienced its first November increase in these filings since 2009. We are keeping a close eye on the increase of foreclosures and its potential affect on our market.”
Our monthly report also includes statistics and analyses in its supplemental “Luxury Market Report” (properties sold for $1 million or greater), “Signature Market Report” (properties sold between $750,000 and $999,999) and “Premier Market Report” (properties sold between $500,000 and $749,999). In November 102 homes sold and closed for $1 million or greater – down 4.67 percent from the previous month, and up 61.9 percent year over year. The closed dollar volume in November in this luxury segment was $164,046,702, up two percent from the previous month, and up 61.34 percent year over year.
The highest priced single-family home sold in November was $7,000,000 representing five bedrooms, six bathrooms and 4,627 above ground square feet in Cherry Creek North. The highest priced condo sold was $2,875,000 representing four bedrooms, five bathrooms and 5,403 above ground square feet in Boulder. The listing and selling agents for the Cherry Creek North home are DMAR members.
“Luxury home sellers had a lot to be thankful for in November, even though sales of single-family homes priced over $1 million was down about two percent from October,” said Jill Schafer, DMAR Market Trends Committee Member and Metro Denver real estate agent. “The blessing is that sales are up nearly 102 percent from the same month in 2015. With only 7.5 months of inventory available in November, we are getting closer to an balanced market between homebuyers and sellers which is five to six months of inventory.”
Year-to-date sales of Luxury Market single-family homes was up 24.57 percent in November compared to last year, which is a notable 179.34 percent more than 2011. Sellers have also seen a steady increase in price per square foot over the past five years, from $227 to $270.
“Luxury condo buyers were the ones enjoying the Thanksgiving pie in November,” comments Schafer. “With more than 15 months of inventory, they certainly had a smorgasbord of choices. However, these homebuyers had to pay 26.3 percent more per square foot year-to-date than they did in 2011, $533 compared to $422 respectively.”
In the Signature Market, single family and condo sales were up 23.09 percent year to date compared to last year, and 226.08 percent year to date compared to 2011.
“Bring on the stuffing because that's over 1,200 more home sales in 2016 year to date, compared to 2011 in the $750,000 to $999,999 price range,” stated Brigette Modglin, DMAR Market Trends Committee Member and Metro Denver real estate agent.