A big chill continued to descend on metro Denver’s housing market last month as home sales fell sharply and the number of listings continued to soar, according to a monthly update from the Denver Metro Association of Realtors.
There were 4,279 homes and condos sold in July, down 21.2% from June and 31.6% compared to July 2021. The number of active listings rose 21.5% from June to 7,361, an increase of 81.5% year over year. There were more than twice as many homes available at the end of July as at the end of April.
Prices are also starting to come down in a more noticeable way. The median closing price of a single-family home sold in July was $650,000, which is down 3% from June and up 8.5% from a year earlier. As recently as April, the median sales price gain was up 18.5% year-over-year.
For condos and townhomes, the median closing price of $408,000 was down 5.1% from June and remains up 7.4% over the past year. Three months ago, the annual rate of appreciation was running 17.5% for condos.
Listings are now taking an average of 13 days to go under contract, a 30% increase from June but still fast. In the spring, listings were taking 8 days to sell on average.
The rapid cooling, which is being driven by higher interest rates and much higher home prices, may leave some buyers concerned that the market is in a bubble that is losing air, one that they should try to wait out.
“With all those uncertainties looming over potential buyers, a housing bubble should not be one of them because housing prices are based on supply and demand,” said Andrew Abrams, chairman of the DMAR Market Trends Committee in comments accompanying the report. “Our supply is relatively low… While prices may go down and days in the MLS may go up, we are still far away from a bubble.”
How tight is inventory? Even with the big increases the past three months, it still remains less than half of the 15,971 listings averaged at the end of July between 1985 and 2021.
For the first seven months, 7.2% fewer homes and condos have sold than in the same period in 2021. But because home prices are so much higher, the sales volume is up by more than $1 billion.
The luxury end of the market, defined as properties that sold for $1 million or more, is hitting the brakes the hardest Closings were off 30.8% in July from June, pending sales were down 18.2% and new listings were down 22.1%.
The classic market, defined as properties selling for between $300,000 to $499,999, is holding up the best. Sales were down 14.1% in July from June, with pending sales down 4.2% and new listings down 13%.