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Denver home inventory increasing, but prices remain high

The May report from the Denver Metro Association of Realtors shows more homes for sale -- and that the median sale price of a detached home was $684,550 in April.

DENVER — Demand for homes in Denver remains high, but experts are noticing a few trends in the local housing market that might signal a future shift.

In its May report, the Denver Metro Association of Realtors said inventory has increased, the number of showings has decreased, and in some cases, bidding wars have cooled off from the extremes seen in recent months.

But prices remain high. The median price of a detached home in the Denver metro reached $684,550 in April. That’s up from $660,000 in March, and an increase of $100,000 from this time last year.

“So while prices are going up, we’re seeing the amount of buyer demand start to diminish just a little bit,” said Andrew Abrams, Chair of the DMAR Market Trends Committee.

“We’re starting to see a little more of a normalization of the market, and where we’re seeing that is month-end active listing number -- basically how much houses are actually on the market at the end of the month. That went up by almost 1,000 properties, which is 40% month over month, which is dramatically higher than historically.”

The month-end active listing number for April was about 3,200 properties, Abrams said. That's better, but still far lower than the average for April (around 14,500 properties, he said). Buyer demand is still higher than supply.

“Even if the amount of buyer demand goes down, we had such a surplus of it, it doesn’t mean we’re going to start going backwards. It just means we're going forward at a slower pace,” he said.

Abrams said rising mortgage interest rates will be the most important factor influencing supply and demand in the market in the coming months.

“At the start of the pandemic, there was all this chaos," he said. "Rates were low, the housing market was hot. Now interest rates are going up and buyer demand is starting to go down."

"We're definitely racing a clock," said Diana Sigida. She and her husband are shopping for their first home right now.

"Just trying to get in a good mortgage interest rate before it gets too high that it's just out of the question anymore," she said.

They're looking for a starter home, ideally three bedrooms, with a budget of around $450,000. At that price point, Sigida said, they're finding very little in the metro area.

"One bedroom, one bathroom, 500 square foot homes," she said. "And we don't even have time to put in an offer – they get bought up so fast."

The couple recently moved to Denver from Texas. They knew finding a home would be difficult, but they hoped still possible.

"If there's a small chance – that's all we want," she said. "A small chance to be able to get a house."

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