September produced a seasonal slowdown, however indicators point to above-normal numbers of active listings.
According to the DMAR Market Trends Committee, these indicators combined with homebuyers anxious to lock-down low-interest rates could make for a hot real estate market heading into the fall.
“The beginning of fall typically ushers in two things - the Rockies being officially eliminated from post-season play, and the number of homes sold in the Denver real estate market tapering off after a blistering hot summer,” said Anthony Rael, Chairman of the DMAR Market Trends Committee and Denver real estate agent. “Having said that, this fall could still shape up to be the hottest home market in the last decade."
As the DMAR Market Trends Committee looked at days under contract by sold finance type, Rael comments that they “discovered some concerning trends.” In September, it took 41.2 days to close, compared to 37.6 last year - a change of 9.6 percent (all finance types). Cash transactions showed little change from 2015 to last month (28.2 versus 28.9); however, financed sales saw a significant change:
- Conventional loans sold in 39.3 days in 2015 compared to 43.2 last month, up 9.9 percent
- FHA loans closed in 38.8 days in 2015 compared to 43.2 last month, up 14.9 percent
- VA loans closed in 39.9 days in 2015 compared to 49.5 last month, up 24.1 percent
The DMAR Market Trends Committee concludes that the increase of days under contract is not a result of TRID, rather a direct result of an appraiser shortage.
By the numbers for the entire residential real estate market (single-family and condos), 5,994 new listings came on the market (down 7.39 percent), 4,927 homes were placed under contract (down 11.97 percent), and 4,936 homes sold and closed, representing a decrease of 11.13 percent from the previous month and 5.55 percent from the previous year. September closed with 7,599 active listings – representing a 3.71 percent increase in inventory over the previous month. Average and median sold home prices were down for the third straight month with appreciation slipping 1.42 percent to $396,706 and 0.57 percent to $348,000, respectively. Days on Market closed the month at 32, up from 28 in August.
The monthly report also includes statistics and analyses in its supplementalLuxury 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 September 100 homes sold and closed for $1 million or greater – down 22.48 percent from the previous month, and up 17.65 percent year over year. The closed dollar volume in September in this luxury segment was $155,610,400, down 21.69 percent from the previous month, and up 18.32 percent year over year.
The highest priced single-family home sold in September was $3,445,000 representing six bedrooms, seven bathrooms and 6,001 above ground square feet in Cherry Creek North. The highest priced condo sold was $3,695,000 representing three bedrooms, three bathrooms and 3,392 above ground square feet in Denver. Both the listing and selling agents for the two transactions are DMAR members.
“The first frost hit the Luxury Market early this year,” stated Jill Schafer, DMAR Market Trends Committee Member and Metro Denver real estate agent. “Sales of single-family homes priced over $1 million were down 26.89 percent from August to September. While a significant drop, there were still more high-end homes sold this September than the same month last year.”
Schafer adds, “Things were still sunny in the luxury condo market. Condos priced over $1 million continued to be a strong segment with a 30 percent increase in the number sold month over month. The power gap between a buyer’s market and a seller’s market continues to shrink in this segment, but homebuyers are holding on to a slight advantage.”
Conversely, sales of condos priced between $750,000 and $999,000 felt the market chill with 38.24 percent fewer sold in September than August.
Brigette Modglin, DMAR Market Trends Committee Member and Metro Denver real estate agent states, “Don’t let that drop fool you though, things were still much better in this Signature Market condo segment than they’ve been in past years, with $100 million more in closed sales volume year to date than 2014. Year over year, condo sales are up 200 percent in this market.”