Buyers getting (a little) more breathing room
As I’ve been chronicling over the last six months or so, the Denver real estate market has been moving at a blistering pace. Record low inventory has pushed home prices to all-time Denver metro highs, and made homebuying akin to an Olympic sport, with all the twists, focus and energy required to score a home.
This has meant homes receiving dozens of bids, waived inspection and financing contingencies, and blazing fast list-to-sale timelines. But as summer arrives and the pandemic restrictions lift, buyers and sellers are turning their attentions to the mountains and travel.
This gives buyers, who have been under intense pressure to act fast and waive contingencies, a bit more breathing room and for sellers to adjust their expectations slightly for timing of their sale.
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I’ve been noticing that the market in recent weeks has begun to cool, just slightly. For example, we had a couple of prime listings that didn’t go under contract immediately, which is definitely different than just a month ago, when a listing would hit the market and go under contract within a few days.
The data backs this up. The number of active listings of Denver metro detached single-family homes more than doubled in May from April to 1,843 listings, according to the latest stats from Megan Aller at First American Title.
Source: First American Title Metro Denver Market Review May 2021
While active listings rose in May, the supply-demand curve remains far out of balance, heavily weighted to demand, especially at price points between $400,000 and $1 million.
The most recent market data from the Denver Metro Association of Realtors — through May — does not reveal the cool, but that’s because what we’re seeing is so real time. DMAR stats show that the median days on market for metro listings was four days, the same as April.
When June numbers come out, I’m betting that we’ll see some of the effect of this slight slowdown — in prices and days on market data.
A cooling but a still-hot market
While the heat of the bidding wars has lowered, there’s still plenty of hot in the market. Homes are taking a bit longer to go under contract, but many are still getting full price, even over list price.
In some ways, this resembles a typical Denver real estate summer (especially as the pandemic ends), as families begin turning their attentions to the cooler nearby alpine climes for weekend trips.
Mountain recreation and a return to travel is sucking some of the attention that, during the pandemic, was much more home-focused.
This means sellers should not expect to go under contract within 48 hours of listing. They’ll still get good offers, but the frenzy has cooled a bit, and it’s good to adjust expectations accordingly.
For buyers struggling to secure a home over the last several months, now’s the time to act. There’s more of an opportunity to find buying success without moving at light speed and waiving contingencies. Those still help, but there’s a bit more room for a balanced approach.