Detached active listings at month end dropped to 4,572, a 16.02 percent decrease from last month, while attached homes dropped 8.94 percent to 1,681, representing a 216.62 increase year-over-year for detached homes and a 109.08 increase year-over-year for attached homes. While inventory increased from last year, the market is still witnessing the typical end-of-the-year inventory decrease, likely due to homeowners choosing to either wait to list their homes until the New Year or remove their properties ahead of the holiday season.
Average days in the MLS increased 20 percent month-over-month to 36 days, which is strictly a 140 percent increase from last year. The attached market also exhibited a 20 percent increase month-over-month to 30 days, a 76.47 percent increase from last year. As the active listings count has grown, days in the MLS have also increased since May, directly related to interest rates. Interest rates affect a buyer’s ability to afford a home. As a result, buyers are taking more time to evaluate the value of each house, indicating that buyers are more discerning.
The average price dropped 0.58 percent month-over-month from $736,675 to $732,437. While this is a small drop, this is also a 4.17 percent increase from last year when the average price was $703,119. Additionally, market-wide price reductions are slowing, and close-price-to-list-price percentages dropped only 0.40 percent for attached and detached properties.
“Without a doubt, the Denver Metro housing market is changing, but the question on everyone’s mind is how long this change will last and what to expect next year,” commented Libby Levinson-Katz, Chair of the DMAR Market Trends Committee and Metro Denver Realtor®. “Most of the answers are tied directly to when we will see relief from increasing mortgage rates that have more than doubled since January. Ultimately, the spring market will be the best indicator of what the New Year will store for us. While we expect to see the Denver real estate market change through 2023 due to interest rates and inventory woes, it has continued to show strength and stability.”
While home values are stable, the announcement of the new conforming loan limits for 2023 will aid in the affordability and accessibility of homebuyers. The baseline loan limit of $647,200 will increase to $726,200 nationwide. This sizable change will make it easier for buyers to qualify for a higher conforming loan, thus avoiding stringent jumbo loan requirements.