Last year, Denver’s real estate market faced the hurdles of limited inventory and seemingly relentless interest rate hikes. Despite these challenges, a balance emerged, offering stability for both buyers and sellers. Sellers bid farewell to the frenzy of multiple weekend offers, while buyers found a window for negotiation.
The December data reveals a market in sync with Denver’s seasonal rhythm. The median closed price experienced a modest 2.8% drop to $551,993, accompanied by a 7.65% decrease in closed sales to 2,620. Notably, the median days on the market in MLS saw a 31.82% increase, reaching 29 days.
Comparing figures to the same period a year ago paints a more optimistic picture. While new listings were down 0.52%, pending sales were up 10.87%. The median close price was down 0.54%, and the median days in MLS decreased slightly from 30 to 29 days. The sales volume in 2023 was 0.76% less than that of 2019 before the market and economy were influenced heavily by the effect of COVID-19, and when the Denver market was incredibly competitive and heavily favoring sellers.
Potential Market Shifts
The pivotal question for 2024 centers on the trajectory of interest rates. With the Federal Reserve projecting three quarter-point rate cuts in 2024, we can also expect relief in mortgage rates. This potential decline could usher in more buyers, gradually driving up home prices. Sellers also may gain confidence, leading to a more robust inventory and an earlier start to the selling season. Another factor to look out for later this year is the effects of the election. Even if the economy is strong, uncertainty can affect the behaviors of buyers and sellers.
As we step into 2024, we have an optimistic outlook. While higher interest rates and limited inventory will still restrict appreciation and activity in the market, as buyers and sellers acclimate to these conditions, the strength of Denver’s economy will keep the market competitive for both buyers and sellers. With a new year also comes renewed energy and enthusiasm. All signs point to Denver having a large buyer pool ready to roll as soon as we see some relief from high-interest rates. The year ahead holds the potential for continued triumphs in Denver’s real estate landscape.