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Denver Real Estate Forecast & Market Report – October 2021

Metro Denver real estate forecast

Will The Denver Real Estate Market Cool With The Weather?

This is the time of year that inventory is typically at it’s highest and prices are starting to go down. This year however, inventory is still extremely low and prices are staying steady. Read on to see how the current market numbers help to forecast if the winter will be a good time to buy or sell and what I expect to happen to the market next spring.

NOTE: Statistics are taken from Greater Denver Metro Counties: Adams, Arapahoe, Boulder, Broomfield, Clear Creek, Denver, Douglas, Elbert, Gilpin, Jefferson, and Park

The best way to read this post: The majority of this post is comprised of me analyzing different metrics to break down what is happening with price, supply and demand across different segments of the Metro Denver real estate market. This helps me determine where the real estate market has been, where it is now and forecast where it is likely to be in the near future. If you are a stats nerd like me, you might enjoy reading the entire post, if not - skip to the summary at the end of each section, or all the way down to the overall Denver real estate market review and Denver real estate forecast at the end of the post. If you are reading this post on a cell phone, turn your device sideways to see the graphs in their entirety.

Metro Denver Real Estate Statistics Snapshot - All Property Types

 Latest Month
September 2021
Previous Month
August 2021
Year Over Year
September 2020
Median Sold Price$535,000$535,000$461,000
# of Active Listings4,5564,7837,911
# Under Contract6,0216,5426,198
# Sold Homes6,0026,3896,690
Months Supply of Homes0.80.81.5
Average Days on Market151224

Metro Denver Real EState Prices

Median Closed Price For The Entire metro Denver MLS - All Property Subtypes

The median sold price of homes in the Denver metro area stayed even from last month at $535,000.  The lowest prices of the year typically occur either in September or December/January. Prices as a whole are down 2.7% from the peak in June and are up 16% year over year from September 2020.

Median Closed Price - Single Family Homes

The median sold price of single family detached homes (houses) dropped slightly (.34%) in September.

Median Closed Price - Attached (townhomes and Condo)

The median sold price for condos and townhomes in Metro Denver rebounded in September to $345,000. Year over year, prices for townhomes and condos are up 17%.

Pricing Summary

Prices stayed fairly steady in September. 

Metro Denver Real Estate Supply

New Listings - Metro Denver, All Subtypes

6,642 homes were listed in September which is almost identical to the number of homes listed in September 2020 and about 600 more than the pre-COVID average in September.

Homes For Sale - Metro Denver, All Subtypes

Another drop in inventory after our peak in July. September typically represents the month with the highest inventory. Our inventory is 42% lower than this time last year and 64% lower than September 2019.

Supply Summary

Our inventory is extremely low at the point when the inventory should be the highest of the year. I think that if COVID cases continue to decline, we will get a higher than normal number of new homes coming on the market in the spring time. The determining factor that will dictate spring prices will be buyer demand.

Metro Denver Home Buyer Demand

Sold Homes - Metro Denver, All Subtypes

Although we are seeing a decline in the number of homes sold, substantially more homes sold in September than in a typical September. I expect this number to continue to fall through January.

Pending Sales - Metro Denver, All Subtypes

The pending homes sales metric is the best indicator of our current market because it is our most recent metric and tells us how many homes went under contract during the month of September, while closed sales and sold prices in September show the results of homes that went under contract months ago in August and late July.
During the month of September, 6,021 homes went under contract. While this is a decrease, it is still approximately 20% higher than a normal September and on par with our typical seasonal high numbers of around 6,000 homes pending.

Demand Summary

Demand is slowing compared to May and June, but this is the normal trend. Despite the seasonal slow down, demand is still about 20% higher than typical for this time of year.

Interest Rates

According to Bankrate.com’s Rate Trade Index, “Mortgage experts mostly expect rates to rise in the week ahead (Oct. 7-13). In response to Bankrate’s weekly poll, 58 percent said rates will go up. Meanwhile, 33 percent said they would remain the same and just 8 percent expect them to fall.”

Today’s Most Prevalent National Rates as reported by Bankrate.com.

  • 30 YEAR FIXED – 3.131%
  • 15 YEAR FIXED – 2.394%
  • 5 YEAR ARMS – 2.792%.

Denver real estate Forecast and market review

Pricing – Overall, all segments of homes throughout the metro Denver area stayed even last month and increased 16% year over year.

Supply – Inventory is still extremely low, it is 42% lower than this time last year and 64% lower than September 2019.

Demand – Demand is dropping from our record highs, but still 20% higher than typical for this time of year.

What’s Next For The Denver Real Estate Market? – My Denver Real Estate Market Forecast: – I don’t expect prices to get much lower than they are now. I think we will see slight increases or decreases through January and then prices will begin to rise again. I see a scenario where next spring/summer could be as crazy if not crazier than this year was. Buyer demand (pending listings) and new listings are at about the same levels as last year; however, inventory is about 42% lower than it was this time last year. If there are a large number of sellers who have been waiting for the end of the pandemic, then inventory could stabilize and return the market to normal.

My Advice For Potential Sellers – If you are ready to sell now, you will still get a great price for your home in a short amount of time. If you can wait until March or April, prices might be higher. The wildcards to waiting are if demand will stay unusually high and if there are a large number of sellers who have been holding off selling until COVID subsides.

My Advice For Buyers – Now through the end of December is probably your best opportunity to find a deal before prices begin another seasonal climb. Buyers still need to be competitive, but terms are more reasonable than they were this spring.

Is a Wave of Foreclosures on the Horizon? – Maybe, but it will not have much of an effect on our market if it does come. Unlike in 2008, most homeowners in the Denver area have equity in their homes today. When the moratorium for foreclosures is lifted, these homeowners can either modify their loans or sell their homes at a profit rather then letting them fall into foreclosure. The homes that do go into foreclosure will likely be bought at auction rather than falling to the banks for REO or bank owned sales.

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About the Author

Nathan Hart, CRS, ABR, PSA, e-PRO
Nathan Hart, CRS, ABR, PSA, e-PRO

I have been a REALTOR in the Denver area for almost 25 years. Through continuing education and extensive real world experience, I have become an expert in the real estate field. Blog posts give me an opportunity to share my knowledge and insights.

If you know of anyone who is thinking about buying or selling a home, please share their name with me or my name with them.

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