The Denver residential market continues to be an interesting study. The 10-year average for new listings in May is 7,044, but we had 7,491 new listings at the end of May. This increase indicates more sellers are willing to sell, providing buyers with an abundance of options. Meanwhile, the 10-year average for closings in May is 5,047, and we observed 4,126 closings. This shows buyer demand remains slightly softer than average. The average 30-year mortgage rate, according to Freddie Mac, is 6.84%, which continues to influence real estate purchasing trends. Let's dive into the key market data for the Denver residential real estate market to understand what is happening with supply, demand, sales prices, and months of inventory for May 2025.
Supply
The total number of active listings at the end of May was 14,905. This is a level of inventory we haven’t seen in years, with May's inventory up 38.5% compared to May 2024. The 10-year average for May is 7,603 active listings, so we are nearly double the norm. The Denver market is clearly experiencing a period of higher supply.
The most recent report for detached home construction starts is April 2025. The Denver Metropolitan Statistical Area (MSA) pulled permits on 874 homes. This is lower than the five-year average of 1,002 for April.
Overall, the market has a surplus of supply. This will stabilize pricing for buyers but limit appreciation for property owners.
Demand
Showings remain a strong leading indicator of demand in the residential real estate market. There were 58,796 showings booked through ShowingTime in the Denver Metro Area during May. This is up 7.9% compared to May 2024 but down (4.4%) compared to April 2025. The average number of showings for May over the last six years is 79,670, highlighting that demand is still weaker than historical averages.
Denver had 4,047 properties go under contract in May 2025, which is up 6.7% compared to May 2024 and up 3.6% compared to last month.
There were 4,126 closings in May 2025 compared to 4,303 in May 2024, reflecting a year-over-year decrease of (4.1%). Compared to April 2025, this represents an 4.3% increase, following the typical seasonal pattern of higher spring activity.
The median days on the market for May increased to 13 days from 9 days in May 2024. Therefore, the market is still moving relatively quickly despite higher inventory levels. The current list price-to-close price ratio remained steady at 100.00%, indicating that sellers are generally receiving their asking prices. When we look at the original list price-to-close price ratio, we find a ratio of 98.90%. This means sellers are reducing their asking prices by 1.1% before they receive an offer.
In summary, demand remains steady but continues to face pressure from higher interest rates and property prices. The trend for 2025 appears to follow what we saw in 2023 and 2024.
Sales
Long-term appreciation for Denver residential real estate averages around 6%, but current market conditions with higher prices and interest rates are moderating short-term gains. The larger inventory is also impacting appreciation by giving buyers more choices.
This May, the median sale price for attached and detached properties was $590,800. This is almost exactly where we were in May 2024 with $590,750. This stability in prices reflects a balanced response to the increase in supply.
Months of Inventory
The months of inventory metric is a great indicator to watch for market trends. A seller’s market typically has 0-3 months of inventory, a balanced market has 4-6 months, and 7+ months indicates a buyer’s market. With 14,905 listings on the market and 4,126 closings in May, we have 4.0 months of inventory. This places the market in a balanced position, which often leads to more stable pricing trends.
In summary, supply, demand, median sales price, and months of inventory are key metrics to watch for understanding market trends. Supply is higher than it has been in years, providing buyers with more choices. Demand, while steady, is slightly softer compared to historical norms due to high prices and interest rates. The median sales price shows stability, suggesting that the market remains resilient even with increased inventory. Lastly, months of inventory indicate a balanced market, setting the stage for moderate appreciation throughout 2025.
To view the full presentation, click here: Denver Metro Residential Market Update May 2025.pdf