Most real estate agents you know have something called an “Elevator Speech,” the pitch they’ve come up with to quickly and succinctly synthesize their skillset, expertise, and market knowledge; the best agents have this ready to go and know exactly when and where to insert it into conversation if they’re not simply asked to spout it on demand. I don’t have one, which is terrible. But I heard a great one this morning courtesy of one of our fantastic agents, Jason Sirois. When he was asked to provide his elevator pitch concerning the state of our current market, he said this:
“Our market does not have an inventory issue, it has a speed issue.”
I’m probably paraphrasing a tad…sorry, Jason. But his quote was at least that good, if not better. Most importantly though, it is a spot-on analysis of the challenges buyers and sellers are dealing with in our real estate market.
You’ll see plenty of headlines in the coming days that tout a second straight month of all-time record-low inventory. Those headlines are accurate. We had 2,316 homes for sale in the entire 11-county Metro Area Real Estate Market. For context, the 30 year average for listings at the end of January is 13,022. Again, those headlines about record lows are correct. But, they’re not going to paint the whole picture.
Driven by low interest rates, demand for homes in Denver is insatiable. Buyers, it’s of paramount importance that you understand this as you embark on your home searches. Be prepared to write aggressive offers to win negotiations in multiple-offer scenarios, and be prepared to be disappointed more than once.
Although we have low inventory, it’s not because we have no listings. People are putting their homes on the market at a rate that’s basically commensurate with what we’re used to seeing. Inventory is coming to the market. What we’re not used to seeing is a median Days on Market number of six (6). What that means is you list your home for sale on a Wednesday. You entertain showings through the weekend. You review offers on Sunday night, and go under contract by Monday. That’s what buyers are dealing with, and need to be prepared for.
The extreme demand coupled with interest rates that remain historically low also continue to drive up final purchase prices. Multiple offer scenarios with aggressive terms and purchase prices well above the original asking price have driven the average closed prices of detached and attached single family homes to $629,159, and $397,792 respectively. Both record highs.
So, indeed. We don’t have an inventory issue. We have so many active and well-qualified buyers that our normal inventory is being devoured as close to instantly as we’ve ever seen in Colorado. It’s a speed issue.
Is it a good time to buy? Yes. It’s such a good time to buy that more people than ever before are trying to do so. If you’re considering entering this market, please let us know so that we can prepare you adequately. As always, don’t hesitate to reach out if you’d like to dive a little deeper into our market. We’re always here to answer questions, and help however we can.
We hope everyone stays happy, healthy, and safe through February, and we look forward to seeing you soon!