Metro Denver Shifts to a Buyer’s Market: What It Means for You
Metro Denver has officially transitioned to a buyer’s market, with sellers outnumbering buyers more than ever, according to a report released by Redfin. If you’re contemplating buying a home in this vibrant city, here’s everything you need to know!
The Numbers Speak Volumes
In April alone, there were 16,357 active home sellers in the Denver metro area, compared to only 11,526 buyers. This statistic highlights a staggering 42% advantage for buyers in the region. To put things into perspective, nationally, there were 1.9 million sellers against only 1.5 million buyers, demonstrating a robust 33.7% advantage for buyers across the U.S.
Denver ranks 19th among 50 studied markets, sandwiched between the bustling cities of Los Angeles and Anaheim.
Historical Context: A Shift in Dynamics
According to Redfin’s report, “At no other point since records began in 2013 have sellers outnumbered buyers by such a significant margin.” Just last year, the ratio was a mere 6.5% in favor of sellers, showing how quickly the market dynamics can shift.
Expert Insights
Cooper Thayer, a seasoned Realtor with The Thayer Group Keller Williams Action Realty in Castle Rock, shared, “May’s statistics will offer further clarity, but I can confidently say we’re in a buyer’s market.” With a skewed seller-to-buyer ratio and an increase in listings, sellers are scrambling for attention, giving buyers a unique edge.
What’s Happening Elsewhere?
While Metro Denver sees a buyer-friendly market, other regions like Southern Florida are feeling the squeeze even more. In Miami, the seller-to-buyer ratio stands at a staggering 3-to-1, with similar trends in West Palm Beach and Fort Lauderdale.
Contributing factors include the prevalence of condos facing rising insurance premiums and ongoing population surges post-pandemic. As demand subsided, many newcomers, including Canadian snowbirds, are looking to exit, impacting the housing scenario.
Condo vs. Single Family Homes
When examining various property types, the condo market is experiencing the most dramatic shift. In April, an astonishing 83.5% of sellers outweighed buyers. In comparison, single-family homes have a 27.8% seller overrepresentation, and townhomes see a 33% advantage for sellers.
Market Trends and Predictions
Despite the ongoing buyer’s advantage, prices in most markets haven’t plummeted. However, if trends continue and mortgage rates remain high, the likelihood of a price drop is significant.
In Metro Denver, the median home price has dipped by just 0.1% over the past year, while nationally, prices have climbed by 1.6%. While Redfin anticipates a 1% national decrease in home values this year, it’s urging sellers to act quickly before they lose the leverage they have left.
Chen Zhao, Redfin’s head of economic research, forecasts, “Inventory is accumulating as buyers scale back due to high costs and economic uncertainty. Prices are already starting to exhibit slight declines.”
A Fluctuating Future
Although the dip in the Denver market may seem negligible, it could indicate a tipping point. Initially, Zillow predicted a 0.1% gain for the coming year but has now revised its forecast to a 0.9% drop by next April.
Yet, demand remains dynamic: listings in March drew an average of 6.2 engaged buyers for every property in Denver, compared to 5.5 nationally. Additionally, 32% of homes are sold above the asking price in Denver, overshadowing the national average of 27%, with half of local listings going under contract in just 11 days.
Conclusion: Get Ready to Navigate a Buyer’s Market
The inventory of homes for sale in Metro Denver is still below historical averages dating back to 1985, according to the Denver Metro Association of Realtors. Nevertheless, this gap is quickly closing.
As a homebuyer, this could be your moment to leverage the current market dynamics. Stay informed, act swiftly, and engage in this buyer’s paradise while it lasts!
For insights on the latest in real estate and business news, consider subscribing to our weekly newsletter, On the Block.
