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Denver Real Estate Market Update – May 2020

denver real estate market statistics

April Numbers Show Impact Of COVID-19

The Denver metro real estate market started out fantastic the first quarter of 2020 and was looking to be another record breaking year – but thats all a distant memory now as the pandemic came and predictably cooled down our hot market.  The final April numbers came out the first week of May and gave us our first real glimpse of how COVID-19 is impacting the Denver real estate market.  In this post, I break down the numbers, summarize the market and give you my prediction on how the future of the Denver real estate market might look. 

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 market has been, where it is now and 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 predictions 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

Latest Month
April 2020
Previous Month
March 2020
Year Over Year
April 2019
Median Sold Price$430,000$434,900$410,000
# of Active Listings9,6429,20310,805
# Under Contract4,6157,2418,699
# Sold Homes4,7355,8256,294
Months Supply of Homes1.61.51.9
Average Days on Market253531

Pricing

Median Closed Price For The Entire Denver MLS

The median sold price of homes closed (single family and attached) went down from March to April for the first time in over 11 years. The price decrease was minimal though (1.12%) and market prices are still up nearly 5% year over year from last April.

Median Closed Price By Square Feet - Single Family

Here, I divided the single family detached (houses) segment into four fairly equal subsegments based on the number of houses sold, by square feet. (Approximately the same number of homes with sq ft between 1,831 – 2,530, sold as the number of homes with 3,531 or more sq ft). While the Denver market as a whole dropped in price, only the houses between 2,531 – 3,530 sq ft dropped in price, the other 3 groups showed a slight gain.

Median Closed Price By Square Feet - Attached

For townhomes, condos and duplexes, I divided the segment into two fairly equal subsegments based on the number of homes sold, by square feet. I limited it two because only 1,179 attached homes sold in the Denver metro in April. Attached home prices were impacted more than detached (2.6% decrease), and they were impacted across the board.

Pricing Summary

Detached single family house prices across the Metro Denver area stayed fairly even while townhomes and condos dropped about 2.5%.  Over the past 5 years, the average difference in price from March to April for single family houses, attached homes and all homes combined was an increase of 1.8%, .8%, and 1.1% respectively.

Supply

New Listings - Single Family Detached, Denver Metro

The average number of new single family detached homes listed in the Denver area in April over the past five years was 6,190.  This April we saw 4,399 new houses listed for a decrease of 1,791 or 29% from our April average.

New Listings - Single Family Attached, Denver Metro

Townhomes, condos and duplexes had 1,527 newly listed properties in April.  This number is down from the 5 year April average of 2,151 by 624 units or 29%.

Homes For Sale - Metro Denver, All Subtypes

As of the end of April 2020, the metro Denver MLS reported 9,642 homes were for sale.  The average number of homes for sale over the past 5 years in April was 7,665.  While it might seem like our inventory is down from where it would be sans COVID-19, it isn’t.  The number of homes for sale in April has risen each year since 2016 and the metro Denver inventory is actually down 10.8% year over year from last April, if we estimated the normal projected increase, the Denver housing inventory was down about 15% at the end of April.

Supply Summary

This is supposed to be the spring season and new listings are supposed to surge.  Both attached and detached segments as well as the metro Denver market as a whole had a 29% decline in new listings this April compared to the previous 5 year average.  Although new listings were down 29%, less homes were sold in April then would normally be expected to sell, so our overall housing inventory in the Denver metro area is only down about 15% from where we would typically expect to see it.

Demand

Sold Homes - Metro Denver, All Subtypes

On average, over the past 5 years, 5,823 homes sold throughout the Denver area in April. This year, the Denver MLS reported 4,735 sales for a decrease of 18.7% compared to the 5 year average.

Pending Sales - Metro Denver, All Subtypes

To me, this metric is the best indicator of how COVID-19 has impacted the Denver housing market. Pending homes or homes that went under contract in April show our activity while the metro area was shut down, while closed sales and closed price in April show the results of homes that went under contract in late February and March.
4,615 homes went under contract in April which is a 39% decrease from our five year average of 7,548 and a decrease of 47% year over year from last April. 
3,036 homes have gone under contract during May as of of May 12.

Demand Summary

Demand was down in April by 39 to 47% depending on if you are looking at an average or year over year change.  Considering that much of the metro area was shut down and we were not allowed to physically show homes during the month of April, I don’t think that this is too bad or unexpected.

Interest Rates

According to Bankrate.com’s Rate Trade Index, “In the week ahead (May 7-13), 55 percent of the experts predict that rates will rise, 18 percent of the experts predict a drop in rates and 27 percent predict that rates will remain relatively unchanged (plus or minus 2 basis points).”

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

  • 30 YEAR FIXED – 3.54%
  • FHA/VA – 3.385%
  • 15 YEAR FIXED – 3.13%
  • 5 YEAR ARMS – 3.31%

Denver real estate market review and predictions

Pricing – Overall, the Coronavirus hasn’t affected the Denver housing market pricing much.  March prices were unaffected and rose at an expected rate.  April typically sees a slight increase in price from March and instead they stayed even or dropped slightly.  In general, April pricing was down about 2% from where we would expect to be.

Supply – New listings or new homes coming on the market in April was down 29% across the board. Because less homes went under contract in April, the decrease in new listings didn’t affect our overall inventory drastically and the metro Denver housing inventory as of the end of April was only down about 15%.  

Demand – Predictably, demand was down sharply in April, by as much as 50% by some measures.  Considering that the Denver area was under a stay at home order and buyers were not able to look at homes, this decrease is not a surprise and not very alarming to me.

What’s Happening Now? – Did you know that the first Monday we were allowed to show homes again, there were more showings scheduled in the Denver area than any other Monday in history?  3,036 homes have gone under contract during May as of of May 12.  If this rate of pending sales continues through May, we will have about 7,500 homes go pending during May which would be about 18% lower than last May.  As of May 12, there are 9,913 active listings and 3,096 of them are new listings which came onto the Denver market in May.

What’s Next? – It is still a strong sellers market although it has temporarily shifted a little bit towards the buyers, especially in the lower price ranges.  Fewer homes went under contract in April so their will be fewer closings in May and June.  I predict that overall, we will have lower sales this year because of uncertainty and income loss, but I think that the market is already rebounding (3,096 new listings and 3,036 new pending contracts so far in May).  Barring a setback from COVID-19, I expect that we will have a stronger than usual summer selling season and that prices will remain steady or go up slightly.

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About the Author

Nathan Hart, CRS, ABR, PSA, RENE
Nathan Hart, CRS, ABR, PSA, RENE

I have been a REALTOR in the Denver area for 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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