A chill settled on the metro Denver housing market last month as the typical end-of-summer slowdown combined with higher mortgage rates to drive sales down by a fifth from the levels seen in August, according to a monthly update from the Denver Metro Association of Realtors.
The Daily Mortgage News reported the average rate on 30-year loans is now around 7.7%. Across several measures, the metro Denver housing market is softening. But buyers still aren’t getting what they really want — a significant drop in prices.
“While overall the data reflects marginal changes, this small indicator showcases that prices are still strong,” Libby Levinson-Katz, chairwoman of the DMAR Market Trends Committee and a local Realtor said in comments accompanying the report.
Closings for both homes and condos fell nearly 21% last month from August and they are down 28.2% from September of last year. Some of that monthly decline is seasonal, but the monthly drop in sales last year was 8.4% and the year before that it was 12.2%.
The number of listings on the market at the end of September rose 11.2% from August to reach 7,629, on par with year-ago levels. Although the supply of available listings is up significantly from the record low for September of 3,971 set two years ago, the inventory is at only half the September average going back to 1985.
Supply is rising despite fewer new listings. Those were down 5.9% to 4,589 last month and compared to last year, they are down 12.6%.
The median or mid-point price of a single-family home sold last month was $640,000, which is down 1.5% from August and up 1.6% from a year earlier. Condos and townhomes had a median sales price in September of $420,000, which is up 0.48% from August and up 2.4% over the past 12 months.
Buyers aren’t haggling on price as much as they are asking for concessions, Levinson-Katz said. And those concession requests, which include things like the seller buying down the interest rate, are allowing common ground to be found, she said.
Sellers on average received a closing price that was 99.2% of the list price last month, which is better than the 98.9% ratio they received a year earlier. Homes and condos were spending an average of 30 days on the market before finding a buyer compared to 26 days last month and last year.
More supply and less demand should lead to price declines, but so far, prices continue to climb, Levinson-Katz said.
While it remains a seller’s market overall, the $2 million-plus segment appears to now be in balance, with six months of inventory for single-family homes and seven months for condo and townhomes, according to the report.
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