Houses in Denver Metro on market less than a week. It's hitting our youngest and oldest home buyers hard
Denver Metro market boom is great for sellers, not so great for buyers
The housing market has been booming in the Denver Metro area for several years now and it's not slowing down anytime soon. This is great news for sellers, many sealing the deal on sales within a week of listing their homes. On the other hand, it's causing a crisis for buyers.
There are more buyers than there are houses, resulting in a seller's market that continues to drive prices up.--Denver Housing Market Price Trends 2021, Norada.
First-time buyers are finding it difficult to even get their foot in the door. The lower priced homes, those labelled "Classic Market" by the Denver Metro Association of REALTORS (DMAR), are moving the fastest.
As Marco Santarelli explains in Norada: "The most competitive segment of the single-family detached market is the $300,000 to $499,000 price range where it's getting even more difficult for buyers to compete."
And the pandemic has added to the problem.
According to a study from the real estate brokerage firm Redfin, there are more luxury homes on the market than the desired classic homes because the pandemic has created an even larger gap between rich and poor.
"Affluent Americans with the flexibility to work from anywhere are taking advantage of low mortgage rates and buying up high-end houses—particularly in popular vacation destinations—which is contributing to the surge in luxury-home sales. Meanwhile, many lower-income Americans have lost their jobs and lack the means to become homeowners."
Also elderly home-owners who would have downsized in the past are staying put. The pandemic uncertainty and rising house prices have detered them from selling, worried they won't be able to find another appropriate home to buy.
Kevin Simpson of the Colorado Sun explains, "Few available options fit their needs, and those that do tend to be outrageously expensive."
They end up staying in family homes that are now too big for them, sometimes even dangerous--with stairs and inappropriate facilities--because they can't find a way to move.
This puts further pressure on an already tight market.
When's a good time to buy?
If you're looking to buy in the Denver Metro area, The DMAR Real Estate Market Trend report has some clues:
"Historically, the market has seen annual inventory reach its low point in February and March, followed by increased listing activity until we hit our inventory peak in August and September," they say. "...it may be possible for buyers who outlast the fatigue of competition to find themselves with more options than they have seen in the past few months."