The Denver residential market is growing for spring time! The 10-year average for new listings is 6,462 for April, but we only saw 6,245 new listings in April 2024. The inventory is increasing and currently, we have 2 months of inventory. Average mortgage interest rates with a 30-year term ended April at 7.17%. Let’s dive into the key market data for the Denver residential real estate market to see what is happening with supply, demand, sales prices, and months of inventory for April 2024.
Supply
In April, we had 6,245 new listings hit the market! This is up 19.8% compared to March, and up 22.7% from April 2023.
The total amount of active listings at the end of the month was 8,158. This is up 22.7% from April 2023. The 10-year April average from 2014 to 2023 is 6,835 listings, so we are above our long-term average!
The most recent report for detached home construction starts is Mar 2024. The Denver Metropolitan Statistical Area (MSA) pulled permits on 851 homes. This is lower than the four-year average of 1,043 for March.
Demand
Showings are a great leading indicator of demand in the residential real estate market. There were 60,464 showings booked through the largest showing service, ShowingTime, in the Denver metro area during April.
This is down (3.2%) when compared to Apr 2023 and up 1.3% compared to Mar 2024. The average amount of showings for April, over the last four years, is 81,507.
Denver had 4,290 properties go under contract in April 2024. This is up 4.5% compared to April 2023 and up 7.7% from Mar 2024.
There were 3,812 closings in Apr 2024 compared to 3,570 in Mar 2024. This is a 6.8% increase from last month. A year ago, we had 3,786 closings in April so the volume of closings is up 0.7% YOY.
The median days on the market for April decreased from 11 days to 8 days, in comparison to last month. The list price-to-close price ratio held steady at 100%, so sellers are generally getting what they are asking. With that said, I have seen overpriced homes sit on the market for a long time.
All in all, demand for housing is softer than during the pandemic due to the higher interest rates. Let’s look at the median sales price.
Sales Prices
The median sales price has slowly risen during but is just below April 2022. The median price in April was $600,000, which is up from $590,000 in March. This metric includes detached and attached properties. The median price has increased $25k from April 2023.
The long-term average appreciation for residential real estate is 6%. Higher prices and higher interest rates will continue to limit appreciation in the short run. Low inventory is helping to prop up the market. If we wake up tomorrow to 35,000 listings on the market, this would be a buyer's market and prices would likely be going down.
This month, prices were up 4.3% from last year! Compared to last month, April is up 1.7% from March.
Let’s look at months of inventory now.
Months of Inventory
The months of inventory is a great indicator to watch for market trends. Typically, a seller’s market has 0-3 months of inventory. A balanced market has 4-6 months of inventory, and 7+ months of inventory is a buyer’s market. In a seller’s market prices go up. In a buyer’s market prices go down.
With 8,158 listings on the market and 3,812 closings in April, the months of inventory is at 2 months or 9.17 weeks. Therefore, the inventory is still low, but is continuing to pick up. We are expecting it to slowly increase.
All in all, months of inventory is a great metric to watch.
Final Thoughts
In conclusion, supply, demand, median sales price, and months of inventory are ideal key performance indicators to watch for market trends. Supply is higher than the record lows of 2022 and 2023 but is still lower than the long-term average. Overall demand is steady even with higher prices and higher interest rates. We believe there is a tremendous amount of pent-up demand happening right now and as soon as rates come down, more buyers will enter the market. Lastly, 2 months of inventory is still quite low.
Link to the full presentation: Denver Metro Residential Market Update April 2024.pdf