By LIV Sotheby’s International Realty downtown managing broker, Steve Blank.
Denver, Colo., July 30, 2017 – Strong April rains helped May and June home sales bloom into an appealing summer market. Denver, Portland, Seattle, Austin, and Dallas are leading a very healthy pace in the national real estate (RE) market. According to recent RE Colorado statistics, through June 2017, Metro-Denver has eclipsed an average sale price of $440,000 (home and condo sales). The market in the $350,000 range is noticeably different than the $1.5 million market; just like the market in Tulsa, OK., is not the same as Denver or Boston. LIV Sotheby’s International Realty (LIV SIR) provided information about Metro-Denver home sales showing “Year to Date” statistics compared to the first half of 2016.
– The number of properties sold was up 4% to 25,741.
– The average sold price rose 10% to $440,000!
– Average days for a home to go under contract is 27 days, but 25% – 30% may go back on the market due to appraisals, inspections, or financing.
– New listing inventory rose 3% over last year, compared to a 4% rise in properties sold, demonstrating a solid market.
– Another interesting statistic shows a 1.1-month average supply of homes compared to a 4.2 month supply nationally (4-6 months is a balanced market).
– According to National Association of Realtors (NAR), homes should appreciate 3.7% in value this year, while Denver will increase over 9% in 2017.
Denver’s luxury market (over $1 million) is considered healthy and balanced, yet should not be confused with the $440,000 RE market. The statistics below were prepared by LIV SIR based on RE Colorado information. By comparing Denver’s luxury market from June of 2016 to June this year, we discovered:
-The number of listings sold rose substantially (28%) from 149 to 190 sales.
-It took an average of 89 days to sell compared to 84 last year.
– The number of active listings stood at 917 (from 922 in 6/16), representing a 5-month supply (with 190 homes selling).
– The average sold price increased a modest 2%, partially due to the size of the sold luxury homes being 6% smaller (5,409 sq. ft.) in June 2017.
Over the last five years, Denver home values have generally improved +/- 10% annually. The luxury market is doing quite well, but increased at a slower pace (2% to 4% annually) during this period. Consequently, the gap between lower and higher priced homes has been shrinking. This is good news for the move-up buyer who is shopping for a home of their dreams (and still at unenduring low interest rates).
Purchasing a luxury home has many variables in determining value. It is not reasonable to merely compare bedrooms, baths, or square footage to arrive at fair value. Well located homes, that are priced to sell, can be sold quickly in today’s market. Too often, the conversation turns to “price per square foot” which compares statistics without considering other important factors. Some are obvious such as location, updates, lot size, and amenities. Other influential differences can be outdoor decks and entertaining spaces, window sizes, technology, ceiling height, floorplans, counter and cabinet space, views, parking, basement size and finish, street noise, etc.
It’s hard to put your finger on why one home isn’t as valuable as another. For example, does a home with a 1,000-square-foot living room, 8-foot ceilings, and small windows sell for the same price as a home with 12-foot ceilings, a wall of windows, and a nice view? Certainly not. Zillow uses algorithms to “Zestimate” home values based on simple criteria calculations, which often produce skewed results.
As in other professions, real estate has professionals specializing in higher end homes. Start by doing research and then retain an experienced professional to help guide your vision and investment.
For more information, contact LIV Sotheby’s International Realty managing broker Steve Blank, at 303.520.5558. To service all your real estate needs visit www.livsothebysrealty.com.