November 2020 Denver Metro Real Estate Update
Despite the severe lack of inventory record numbers keep coming in for the Metro Denver Real Estate Market. We continue to watch for any signs of a slowdown in the market, it doesn’t seem to be happening yet. As a reminder, here are the items I am watching for when it comes to shift.
Showings, how many per listing each week and how many showings on average to receive a contract.
- If shows per property goes down, we may see shift.
- If it requires more shows per property to go under contract, this may be another indication of shift.
Pending and New Listing activity.
- If new listings increase or pending sales drop then we may see shift.
The odds of selling.
- This is a % of all homes available vs. those that go under contract and/or sell in a given 30-day period.
Price Reductions, what % of homes are reducing and how much.
- This is counterintuitive. A shift to buyer opportunity would reveal itself by more widespread price reductions but at lower amounts.
If we do not see shift, here are ideas to help home buyers who may not be in a position to be as competitive:
- Let’s go out around the holidays. These times represent a small window of opportunity for buyers to be in less competitive situations as the Odds of Selling drops.
- To improve your negotiating opportunity let’s also look at homes that have been on the market for longer than 2 weekends when showing activity begins to decline and sellers are considering price improvements.
Now, onto the November numbers.
Detached Single Family Highlights:
· Active inventory sharply declined month-over-month by -12.7%, also down from the same month one year ago by -55.7%. Inventory for the month of November was 1,699 units for sale.
· Contracts accepted, or pending sales, decreased by -22.9% and were up from the same month one year ago by 8.0% with 3,069 contracts accepted in Metro Denver.
· Closed units down month-over-month by -20.0% and were up +23.5% from the same month one year ago.
· Days on market held fast at 19 days on market as an average, as did median days on market, coming in at 6 median days to contract.
· Flash sales- or units pending after just one week on the market were reported as 59.5% of all detached units closed in November.
· The competitive nature of the market post COVID-19 quarantine in November reported that 21.8% of closed transactions sold for a full price offer with 47.7% sold for over asking price.
· Even though average home prices appreciation was up 15.2% YOY to $602,477 - when coupled with the recent drop-in interest rates a 30-year fixed loan with 10% down will yield principal and interest payments of $2,214; which is +2.5% more than purchasing an average priced home one year ago.
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Data courtesy of Megan Aller, First American Title