DMAR Real Estate Market Trends Report | JAN. '15
Strong Denver-Area Economic and Labor Markets Contribute to Favorable Outlook in 2015
The month of December and the year of 2014 set records in several categories of residential real estate, and a look at the numbers proves why. In 2014, there was $17.5 billion in closed dollar volume and $4.4 billion in the secondary market. Combined, this resulted in a $22 billion impact on the Denver area economy!
Year over year average sales are up 11.22% and median sales prices are up 14.47%. Year-to-date, a total of 53,719 homes closed at an average sold price of $325,634. Condos alone were a powerful force on the 2014 Denver market, with a tremendous 56% increase in sales volume year over year. Said Anthony Rael, Chair of the Denver Metro Association of REALTORS® Market Trends Committee:
“One thing is certain, 2014 proved that we have the capacity to do more with less and our REALTOR® members will need to figure out a way to replicate the successes of this year as we march into 2015.”
The strength of the Denver market continues into 2015. Current economic and labor markets are favorable, with consumer confidence rising slightly to 92.6%. This increase in confidence and improving economic conditions are forecast to benefit the Denver housing market in the coming year.
Active listings for single family and condos decreased nearly 20% from the previous month
to an annual low of 4,355 units in December. At December month end, there was less than a 500-unit difference between the number of active listings and the number sold or closed (3,869). Rael comments:
Low inventory levels may be the new norm – at least for the next 12 to 18 months. Sellers will continue to have the upper-hand in negotiations with buyers, but pricing and condition will need to be justified in order to ensure top-dollar. Consumer confidence is high and mortgage interest rates are low. Buyer demand is strong, but homebuyers need to be patient and prepare to compete until more inventory comes online.” ~Anthony Rael, Chair of the DMAR Market Trends Committee
Good news for all those waiting buyers, however: the outlook for new builds looks favorable, fueled by the impatience of consumers waiting for resale homes to hit the market. Foot-traffic and sales activity for new home construction was strong in December, and the question, according to Rael, is whether “builders have enough skilled subcontractors to keep up with demand.”
By the numbers, the inventory of available homes for sale was 4,335 at December month end. 2,296 properties came onto the market, 2,510 properties were placed under contract, and 3,869 properties closed at a median sold price of $287,000 and an average sold price of $340,448 resulting in closed dollar volume of $1.3 billion last month.
The report also includes statistics and analyses in its supplemental “Luxury Market Report” (properties sold for $1 million or greater), “Signature Market Report” (properties sold between $750,000 and $999,999) and “Premier Market Report” (properties sold between $500,000 and $749,999). Notably, sales of million dollar homes in the Luxury Market are up 43 percent since 2012. Jill Shaefr, a member of the DMAR Market Trends Committee, stated:
“December was a great month for the very high end market with 44.64 percent more homes sold than in November. And they sold for more. December home sellers got more than 9 percent for their homes than November sellers.”
Eighty-four homes priced $1 million or greater closed in December, with an average sold price of $1,501.266, resulting in a closed sales volume of $126.1 million. The highest priced home sale in December was a $3.75 million single-family property representing 6 bedrooms, 10 bathrooms and 8,046 above ground square feet in Cherry Hills Village.
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The DMAR Market Trends Committee releases reports monthly, highlighting important trends and market activity emerging across the Denver Metro area. Reports include data for Adams, Arapahoe, Boulder, Broomfield, Clear Creek, Denver, Douglas, Elbert, Gilpin, Jefferson and Park counties. Data for the report was sourced from REcolorado® (December 2, 2014) and interpreted by DMAR.