June 2022 Market Update
June brought what we’ve all been waiting for, inventory. Active inventory ticked over 6,000 units and for the first time since June of 2020, there is more than one month’s inventory available. Denver is still a ways off from being a buyer’s market, but there are still a lot of opportunities for buyers that have been intimidated by the market in the past.
Buyers and Sellers
While inventory is still relatively low, June inventory was up 65% from May and 94% over June 2021. A jump this dramatic has a significant impact on the relationship between many buyers and sellers. While homes that are move-in ready and in prime locations are still seeing multiple offers above asking, it’s no longer every home. More buyers are maintaining their contingencies and getting a home they love for the list price. The list to closed price ratio is now 103% down 2% from last month and last year. While it is no discount, it is a trend to watch.
Home Prices
Even with the increased inventory, demand has maintained the average closed price. The average Denver buyer has been sifting through low inventory for many months and is excited to have options. Homeowners that have wanted to sell, but were unsure if they’d be able to find a replacement home are seeing increased inventory as their sign to jump into the market. After months of double-digit appreciation, back-to-back months maintaining the average home price of about $700,000 is a testament to the demand in the Denver market.
Market Conditions
Considering the market as a whole, interest rates continue to be volatile, but ended the month under 6%. The Fed is predicting more Federal Fund rate increases before the end of 2022. This attempt to curb inflation will likely push rates even higher. Move-in-ready homes may be in such high demand when you look at the obstacles renovators face. Some contractors are quoting 4-6 months for permit approvals and building material prices are up 19.2% this year.
The new Denver inventory is more than welcome, but demand persists. The average days on the market in June went up only 1 day to 10 days while the median days on the market remained at 4 days. Most homes are selling in one weekend, above asking price. With the market changing so quickly, an educated and experienced agent is more important than ever. Reach out to your Generator advisor for a personalized market analysis.