Denver metro area real estate market remains on fire
Denver metro area real estate market remains on fire, hitting record high number of homes sold in the months of July, August, and September. July 2020 hit a record high number of home sales in any given month in metro Denver area, at 7,322 homes sold, however home sales in August dropped 18.73% compared to July. August 2020 saw the most home sales of any month of August on record, at 6,555 homes, yet housing inventory hit the lowest point for any month of August on record with 40% less homes on the market than last year.
Since family homes are scarce as inventory can’t keep up with the buyer demand, which drove up the average single-family home price to a new record high of $606,330 in August. Year to date through August, sales volume was up 3% compared to 2019 at over $20 billion. At month end in August, there were 5,496 active listings, down 41.22% year to date compared to last year. Furthermore, there were 11.13% fewer homes added to the market in August compared to July. Homebuyers looking to purchase a single-family home really struggled because there were 50.26% fewer homes for sale compared to August 2019. E.g., single-family homes priced between $500,000 and $749,999 had only 0.66 months of inventory.
As buyer demand continues to outpace supply, prices continue to go up for the Denver metro area real estate market. The average price for a single-family home hit another breaking record at $606,330 in August, an increase of 5.56% year to date. Condo sales weren’t doing quite as well as average August prices were down month over month, but still up 2.58% year to date. The average days on the market dropped to 23 days compared to 30 days a year ago, however, the median days on the market dropped to an astonishing 6 days.
For luxury segment, which are homes sold and closed for $1 million or greater, a total of 354 homes sold, down 14.7% month over month, but still up 52.59% year over year. The closed dollar volume in the luxury segment in August was nearly $560 million, down 13.69% month over month, but up 58.25% year over year. Year to date, the sales volume for the luxury segment was up 7.35% compared to August 2019.
September also set new records in the categories of the lowest number of active listings, median days on market and months of inventory, as well as the highest number of new listings, pending and closed homes, median home prices and total sales volume. At the end of September, there were a total of 5,301 active listings, the lowest amount of active housing inventory available on record for any month of September by 2,215 properties.
In September 2020 for the Denver metro area real estate market, there were 3,041 single-family homes available for sale, a decrease from the previous low of 5,693 in September 2017, while the condo segment ended the month with 2,260 active listings, a 18.20% drop from a year ago. The median days on the market in the entire residential market was 6 days, which was 3 days lower than the previous record set in September 2015 and 2016. For both single-family and condos, there were more closed and pending transactions than ever before for the month of September, reaching 5,850 homes that sold and 6,376 homes in pending status.
The housing inventory can’t keep up with the high level of homebuyer demand. This further evidenced in that the months of inventory hit an all-time low at 0.91 months of supply. Furthermore, the median home price for both single-family and condo homes for Denver metro area real estate market hit a record-breaking high at $510,000 and $334,752 respectively. The total sales volume of $3.15 billion represents the highest amount for any September on record and the third-highest month of all time.
Year over year, 80.65% more luxury homes sold in September, as more homebuyers seem to be wanting single-family homes compared to condos in this price segment. Year over year, 87.2% more single-family homes closed. The luxury condo market is also still showing signs of strength with 31.82% more sold compared to 2019.
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How much do you need to earn to live comfortably in Denver? According to GBankingRates.com, the income you needed if you’re a home owner: $109,020 and $103,236 if you’re a renter.
