November 2021 Market Update
The snow is finally falling, but the real estate market in Denver hasn’t quite cooled down yet. Buyers are looking to find homes while interest rates are still low, so sellers are still seeing multiple offer situations and record-high sales prices. The Denver market is still experiencing record low inventory and in November, it dipped even lower.
Residential inventory at the close of November was down 33.41% to 2,248 active listings. This includes 1,444 detached properties and just 804 attached properties. Inventory is down 34.17% from this time last year. Further complicating things, we are seeing many sellers that are planning to wait out the winter and list in the more conventional real estate “season”, starting in February. While challenging, this environment has not discouraged buyers, as more homes have sold this year than any of the past 5 years. It is not that there are no homes to buy in Denver, just not enough to keep up with the city’s growth.
While inventory might make it challenging to buy, those who are continuing their search and staying aggressive are being rewarded with homes that are going up in value by an average of 2.9% month over month. Average home values in Denver are 15.49% higher than one year ago. While higher interest rates might slow this growth, the overall cost of buying a home is on the rise.
Consider interest rates. Many industry experts are expecting gradual increases to rates throughout 2022. By how much, really depends on the overall health of the economy. Often higher interest rates mean low economic growth, but also low inflation. The Fed will carefully balance these factors in an attempt to assist the economy post-covid lockdowns, but curb inflation.
Considering home prices and interest rates, we don’t see an environment in the near future that will be more favorable for buyers than it is today. Record low inventory is challenging buyers to be creative and see potential in homes. This, in turn, means that well-priced homes that might require some love, are selling quickly and for record prices. When you are ready to move, reach out to a Generator advisor who will deftly guide you through the sometimes crazy, Denver market.