As the fall chill blew through Denver this September, it did nothing to cool down the market. After the inventory lull in August, the moderate increase in September inventory felt significant and gave buyers more options. The number of closed homes in September was down 12.81% to 5,288 due to the August lull, but we are still on track to see more homes sold in 2021 than any year prior.
The average price of a home closed in September was $618,293. Only a modest 0.77% increase from August, but that amounts to a 15.11% increase from last year. This shows that prices are stabilizing, but still increasing. The closed to list price ratio dropped 0.6% to 101.9%. While this might feel like a dramatic shift, our experience is that it’s attributed more to fewer buyers in the fall months and sellers pricing their homes right, than a major price shift in the market.
One factor that continues to plague the Denver market is the lack of inventory. Construction stoppages due to COVID are being further delayed by manufacturing and shipping delays. Homeowners are less likely to move due to low-rate mortgages, the increased cost of moving, and the difficulty of finding a replacement property. September inventory was 3,971 homes, up 10.86% over last month, but down 25.09% over last year, making it the lowest September inventory recorded. One bright spot is that this September inventory is actually twice the inventory of March 2021.
Looking toward the future there are a few factors to consider. Interest rates will inevitably rise as the national economy recovers. The end of September already saw rates increasing slightly, but it might not be enough to tamp down demand. Denver is still seeing an influx of 26-32-year-olds moving to the city and looking to buy. The record breaking stock market plus the existing equity of homeowners gives them more buying power to compete at higher prices. Because we don’t see an end date for these factors, we still believe that this is a smart time for both buyers and sellers to jump into the market.
If you are ready to buy or sell, but don’t know where to start, we’d love to help. Set up a meeting with a Generator advisor, we’d be honored to guide you through the process.