Home sales in and around Denver dropped in November with buyers and sellers opting to sit on the sidelines in the face of high interest rates.
The housing market typically slows during the colder months as families hunker down for the holiday season. But the decline was particularly acute this year. The number of houses sold last month was down about 19 percent from the same time last year, according to a report from the Denver Metro Association of Realtors.
The report found that the number of homes on the market is piling up, with active listings for November reaching 6,684. That's the highest November tally since 2019, nearly triple the number of homes available in November 2021.
Inventory is rising even as many homeowners opt to stay put rather than take out a new mortgage at the going rate. Mortgage rates are the highest in decades as federal regulators keep interest rates elevated in the ongoing fight against inflation.
"It's not that sellers don't desire to sell their current home and move, it's that they don't desire to part with a low rate on their current mortgage and trade it for a rate that could be three to four times higher," Susan Thayer, a Denver realtor, wrote in the report.
At the same time, buyers willing and able to pay for a home in today's interest-rate environment are being pickier.
The stalemate hasn't had a huge impact on prices. The median cost of a house in Denver stood at $580,000 in November, down 1.69 percent from a year ago. That's almost 40 percent higher than in November of 2019 before the pandemic housing boom pushed housing prices to record highs.
Still, buyers are getting better deals now than they have in years, according to the report, especially for houses that aren't in great condition.
"Homes in need of work linger on the market, awaiting buyers who often hold out for two to three price reductions before making an offer," the report's authors wrote.
Economic forecasters are predicting the U.S. central bank could begin cutting interest rates next year. If that happens, the housing market would likely see a burst of activity.
