Denver has grown tremendously over the last several years, and that growth has in large part been driven by the number of people moving into the city. Shockingly, those people need somewhere to live, and that influx of potential homebuyers has made the city into one of the most competitive housing markets in the country. Not only does that mean rising costs and faster transactions, but a recent Re/Max report said it may mean a harmful reduction of overall housing inventory.
Right now a home in Denver only sits on the market for 22 days which is one of the shortest times in the nation and is comparable to other quickly growing cities like Seattle, at 19 days, and San Francisco, at 22 days.
“(The statistics) truly indicate that for a consumer that’s getting ready to put their house on the market there is a density of buyers out there looking to purchase it,” said Kerron Stokes, a real estate agent with Re/Max.
The housing inventory in Denver is down 16.67 percent from last month.
This type of market can be particularly challenging for first-time home buyers looking to get their first experience in the real estate market. Stokes noted that the price point most first-time buyers are looking to purchase at has a dramatic effect on their experience of the competitive process.
“The effect on the $300,000 to $400,00 home is increasing and the people that can’t buy at the $500,000 level are competing in the $400,000,” he said.
The price can also have a misleading impact on how the average time on the market reflects what the actual marketplace feels like.
“Properties that are underneath $300,000, average days on market that may be seven days,” said Stokes. There is hope, however, for those looking to get into this red-hot market as there have been some price reductions and some slight increases in the days of over market in the last year or so, according to Stokes.
“Markets always cycle, so how long that cycle’s going to last is hard to predict. If you look at the past couple of quarters, because of the rapid increase of home prices and as well as the first time interest rates going up, there’s a normalization occurring,” said Stokes.
He also noted that there are emerging neighborhoods to check out if you’re looking to purchase in that 400 and under range, but they mainly exist outside of Denver proper. In areas like Green Valley Ranch, and north and south corridors of I-25, contractors have been able to bring some costs down and provide housing in that price range. There are also a couple of neighborhoods he foresees maintaining a super competitive market for the near future, like Athmar and Barnum, Ruby Hill and Harvey Park.