Real estate prices in the Mile High City are a mile higher than a year ago. To be more exact, home prices in the Denver metro area have risen by nearly 10% over the last year or so. This is according to the latest release of the S&P/Case-Shiller Home Price Index.
The Case-Shiller report published yesterday contained data through the end of February 2013. From February 2012 to February of this year, home prices in Denver rose by 9.9%. See table below for details.
According to the real estate website Zillow, the median sales price for this area rose by 9.1% over the last 12 months.
Properties in and around the city are selling quickly, much faster than the national average. According to a recent housing report in Time magazine, half of all Denver homes listed for sale are selling in less than 30 days. Desirable homes are selling in a matter of days. Anecdotal reports from local real estate agents support this.
Denver-area real estate agent Jennifer Oldham recently told 7NEWS of a property that got four offers the day after being listed – despite the inclement weather. “I listed it on Monday,” Oldham said. “I had agents trekking through the snow to see that house.”
A ‘Perfect Storm’ for Denver Real Estate
Denver’s real estate market is currently experiencing a perfect storm of rising demand, shrinking supply, and record-low mortgage rates. Consider the evidence:
Each month, Realtor.com publishes a housing report with real estate trends and data for 146 of the largest U.S. metro areas. According to their most recent report, the total number of real estate listings in the Denver area dropped by 30% over the last year. That puts it among the top 15 U.S. metropolitan areas, in terms of inventory reduction.
Many local home buyers will be surprised at just how competitive this market has come — and how much it has shrunk. Things will only get hotter as summer approaches.
Local housing demand has risen due to increased market stability and low mortgage rates. Prices within the Denver real estate market have been stable and rising for some time now. This inspires confidence among home buyers and investors alike. Positive reports from the broader economy bolster this confidence even more.
Low mortgage rates are also doing their part to draw buyers into the market. Average rates for both the 15-year fixed and the 5/1 ARM hit record lows last week, according to Freddie Mac. Mortgage rates are expected to remain low over the coming months, largely due to actions taken by the Federal Reserve to keep the federal funds rate low.
Outlook for 2013? Denver’s real estate market will continue to heat up through the summer months. Rising demand and limited supply should put upward pressure on home prices. During the summer home-buying “season,” buyers and sellers can expect to see an increase in bidding wars, as competition for homes rises.
Disclaimer: This story contains forward-looking statements about the Denver real estate market and the economy in general. These statements were based on data and trends available at the time of publication. Housing conditions change all the time. As a result, we make no claims or assertions about future conditions within this local housing market.