Denver housing market heads toward equilibrium

(Breno Assis on Unsplash)

By Margaret Jackson / NewsBreak Denver

(Denver, Colo.) With the changing season, Denver is heading toward a balanced housing market.

A market with less than three months of inventory is considered a seller’s market, while a market with more than six months of inventory is considered a buyers market. That means that three to six months of inventory is a balanced market.

While the overall metro Denver market has just 1.98 months of inventory, some price ranges are flirting with the three-month threshold. Homes priced between $100,000 and $199,000 have 2.75 months of inventory, while those priced at $1 million or more have an inventory of 2.62 months.

“I believe we are moving toward a balanced market, which we haven’t seen in over 16 years,” said Libby Levinson-Katz, chair of the DMAR Market Trends Committee.

“A traditional cycle for the Denver real estate market is seven years. Due to an economic crash and a global pandemic, the cycles were extended, but a correction is needed.

“The market is entering a period of neutrality where the bullish ways of extreme markets make way for a stage of compromise, with buyers and sellers working together for a win-win experience.”

With the start of school, luxury market sellers — properties sold for $1 million or more — are focusing more on listing their homes. New luxury listings were up 18.86f% from August, with a total of 649 homes priced over $1 million hitting the market in September.

“Traditionally, experts say that less than three months of inventory still constitutes a seller’s market, but anecdotally, it doesn’t feel like a seller’s market anymore,” said Colleen Covel, DMAR Market Trends Committee member.

“We are experiencing full inspection objections, price reductions, no competing offers, no appraisal gaps and even contingent offers. The question on everyone’s mind is are we finally in a luxury buyer’s market. The technical statistics may say, ‘Not yet,’ but it sure feels close.”