Although the number of active home listings in metro Denver jumped 31% in May, the median close price only dropped slightly, and the close-price-to-list-price ratio continues to hover around 100%
According to the Denver Metro Association of Realtors monthly report, active listings increased from 6,990 in April to 9,159 in May, and the number of new listings increased from 5,979 in April to 6,966 in May.
The number of active listings is up 75% from May 2023, while the number of new listings is up 34% from a year ago.
Despite the increase, the number of homes on market remains historically low. The average number of active listings for May from 1985-2023 is 14,895. The historical average increase in listings from April to May is 7.48 percent, so this year’s 31% increase set a record and surpassed the previous record of 27% in 2019.
Despite continuing high interest rates, more homeowners are selling their homes.
Experts expected inventory to remain flat this year without significantly dropping mortgage rates. Homeowners who secured 4% or lower interest rates during the pandemic would be reluctant to sell their homes unless motivated by major life changes in the “need to move category” or the five Ds—diapers, diplomas, diamonds, divorce, and death.
“That doesn’t seem to be the case, as sellers have been not only stepping but jumping off the fence to enter the market for a variety of reasons,” said Libby Levinson-Katz, chairwoman of the DMAR Market Trends Committee.
With more homes on the market, sellers must prepare them for the market. Levinson-Katz said those who do see their homes close more quickly.
Although buyers have more options, their negotiating power remains limited as the close-price-to-list-price ratio rose slightly to 99.8% in May from 99.7% in April.
“If you’re a buyer, being patient and understanding the ins and outs of different neighborhoods has never been more important,” said marketing committee member Andrew Abrams of homes priced at $1 million or more.
“The speed at which properties sell, the condition of those properties, and other terms sellers are expecting are important for a buyer to set expectations and make a quick decision when they find ‘the one.’”
Michelle Schwinghammer said homes priced from $500,000 to $749,999 continue to sell quickly.
“Sellers should be prepared for knowledgeable buyers this summer and be patient with difficult economic conditions,” she said.
“Major repairs are dealbreakers and need to be taken care of proactively before listing or closing. If not, unwilling sellers should prepare for the majority of would-be buyers to pursue other homes or explore new home communities instead.”
The news and editorial staffs of The Denver Post had no role in this post’s preparation.
