April numbers in Denver Real Estate are out!
The most recent stats show hope for buyers while also painting the reality of a market drastically changed by the past 12 months.
The bright spots:
Active Listings at month end increased 35% from March ‘21 to April ‘21.
The 4,662 new listings in April 2021 are up almost 40% from last year’s (April ‘20) 3,338 new listings. Remember that April 2020 hd us in the middle of the shutdown and still uncovering the realities of a “pandemic economy.” Regardless, this increase in new listings shows a return to more normal season patterns.
Prices continue to remain elevated in the “new normal.” The average close price in April ‘21 is 623,825, an increase of 24.2% from April 2020’s average of $502,270. A common question I still get from those outside the real estate industry is if the market will “crash” or prices will fall.
Even if the market slows down, it is highly unlikely that these prices will reverse course in the current market conditions. There are simply too many buyers. Despite the record-breaking prices 53% of Americans believe it is a good time to buy according to Gallup survey reported this week.
Competition continues to drive prices above list: in April 2021, the average closing price was 104.6% of asking price.
An interesting side effect of the price increases and hyper demand is the divergent appreciation of detached (stand alone) vs attached (think row homes) homes. This April, the attached market saw a month-over-month appreciation of 7.30 percent, while the detached market saw an increase of 4.28 percent. The likely root of this trend? The attached market has a more affordable entry point as the average purchase price of a single-family detached property in the Greater Denver Metro area is $699,039.
What does this mean for buyers? Saving cash for an appreciation gap is more important than ever as competition for single family homes spills into detached markets.
What does this mean for investors? Traditionally cheaper attached investment properties are getting more expensive. The Denver market continues to experience high appreciation and cash-flow will be out of reach until rent prices can catch up.
What does this mean for sellers? It continues to be a good time to sell, especially under your terms.
If you’re looking to invest in Denver, prepare yourself. Other questions? Let me know if I can help.