DMAR Real Estate Market Trends Report | MAR. '15
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Market conditions raising entry point for first-time homebuyers with housing inventory at unprecedented low & home prices increasing.
Denver inventory remains low, which continues to drive up home prices. Year over year, home prices have increased 19 percent and 18 percent in the average and median sales price respectively. According to Anthony Rael, Chair of the DMAR Market Trends Committee:
“Scarcity of inventory and increasing home prices, coupled with the possibility mortgage interest rates will rise when the Federal Reserve meets in June, has millennials entering the real estate market at a rapid pace.”
The number of active listings inched its way to an unprecedented low. However, February did usher in a healthy dose of new residential listings that represented a 13 percent increase from the month prior. The frigid cold temperatures – which surpassed a 103-year-old record– did not deter buyers from writing offers as evidenced by the 16 percent spike in properties that went under contract.
According to the report, the inventory of available homes (single family and condos) for sale was 4,079 at February month end. Notably, 4,240 homes came onto the market, 4,077 homes were placed under contract, and 2,667 homes closed at a median sold price of $295,000 and an average sold price of $348,127; resulting in a closed dollar volume of $928.45 million. Mortgage interest rates increased in February and ended the month with a 30-year conventional rate around 3.625 percent and a 15-year conventional rate at 2.875 percent.
“As year over year housing prices continue to increase, home affordability is going to become a greater issue as the entry point for first-time homebuyers grows higher and higher. The continuation of a strong job market in Colorado will hopefully offset the drag from an expected increase in mortgage rates this summer.” - Anthony Rael, Chairman of the DMAR Market Trends Committee
DMAR’s monthly 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, 52 homes closed in February for $1 million or greater – which is a 41 percent increase from the month prior – with an average sold price of $1,547,264. Closed dollar volume in February was $80.5 million, up 59 percent from January 2015 that had reported $50.7 million. Jill Schafer, member of the DMAR Market Trends Committee, stated:
“No winter weather blues on the high end of the market. February’s 22 inches of snow in the Denver-area did not bury the high-end market last month. In fact, it heated up.” - Jill Schafer, DMAR Market Trends Committee Spokesperson
The highest priced home sale in February was $3,522,000 representing five bedrooms, six bathrooms and 4,345 above ground square-feet in Cherry Creek. Both the listing and selling agents for the transaction are DMAR members. Additionally, both the listing and selling agents from the highest priced condominium sale, also in Cherry Creek, are DMAR members. The condo was $1,425,000 representing four bedrooms, five bathrooms and 3,193 above ground square-feet.
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