We thought July was a sizzler with the weather and the real estate market, but in parts of the Denver metro area the month of August closed out summer even hotter. Average home prices in both Denver and Boulder hit record levels in August, according to IRES/Infosparks and the Denver Metro Association of Realtors Market Trends Report. The average price of a home in Boulder County exceeded $750,000 for the first time ever, while the average price in the 11-county Denver Metro area topped over $606,000. Low inventory levels combined with unseasonably high demand fueled by low interest rates continue to put upward pressure on prices with little relief in sight for this heat.
While our markets continue to experience increasing average prices, the last month and the last 7 days indicate that the activity level in the market may be slowing slightly. This could be a function of buyers experiencing pandemic-weariness, or it could indicate that home shoppers are busy getting kids settled with the start of school, or are worried about job stability and the economy. Although the number of sold properties in Boulder and Broomfield Counites was up almost 10% and under contract properties were up over 25%, new listings were down almost 22% compared to the same week in 2019.
The listing inventory story is consistent with prior weeks - over 47% of the new listing inventory in the last week was within reach of first-time home buyers, priced up to $600k, while 16.4% was priced over $1M. Almost 70% of the area’s new listings this week were in Boulder and Longmont while the outlying Boulder County suburbs and mountain communities continue to be challenged by single digit inventory and one month or less of supply.
The sell-through rate of over 116% last week indicates a much higher level of buyer activity in our market than we’ve experienced in the last 4 years or more. And it is the 4th highest weekly sell-through rate that we have seen in 24 months. Anything over 100% indicates that we are literally running out of listings as homes are selling faster than they can hit the market! If we had more inventory it’s a certainty that we would have higher sales and higher sales volume.
Per a recent article in the Denver Business Journal, “A lack of inventory has dogged the Denver market in recent years, but the issue has been magnified during the coronavirus pandemic. Buyers have returned to the market in droves, but available supply has struggled to keep up. Homeowners interested in selling their homes are wondering if they'll be able to find a new home once they do sell.”
The following charts show the last 24 weeks of activity for new listings, sold transactions, properties under contract, and withdrawn listings. Labels indicate weekly lows and highs over the 24 week period as well as the starting and current week statistics.
New listings peaked in mid-June and correspondingly units under contract peaked in mid-July and sold units peaked in early August.
Typically, sales slow in August as families settle in for the school year, but we all know 2020 is anything but typical. Sold units in Boulder and Broomfield Counties this August were up over 26% compared to August of 2019, and pending sales were up over 11%. In the 11-county Denver metro area pending sales were up almost 33%. It’s definitely a great market to be a seller but once you make that leap you also become a buyer, and if you want to stay in the Boulder/Denver area that’s a daunting prospect!