Market Predictable … and Affordable?

Mike Cooke July 26, 2017 Buying Market Trends Selling

Market Predictable … and Affordable?

Market Predictable … and Affordable?

“Second verse … same as the first.”

That iconic line from a 1910 British theatrical song, famously reprised by Herman’s Hermits in the 1960s, summarizes the metro Denver residential real estate market. It is keeping the same pattern year after year.

  • The 12-month moving average for single family home prices is 8.5% now versus 9.5% a year ago.
  • Multi-family homes price increases have slowed a bit but are still pushing 10% on a 12-month moving average basis.
  • Inventory of homes available for purchase at the end of June stood at 6,227, a grand total of 42 fewer homes that were on the market at the end of June in 2016.

Will this pattern ever change? Sure. Experts speculate endlessly on possible causes, although most don’t see much of a shift until at least 2019.

In the meantime, news on housing affordability is good. Two studies just completed by CHR and soon to be released on the metro Denver residential market show:

  • Average payment for principal and interest stands at $1,816, which is very close to the inflation adjusted average of $1,744 over the last 43 years.
  • A house payment consumes a smaller percentage of income right now than it has in 32 out of the last 43 years.

Here is a summary of several market parameters for June 2017 compared to June of 2016:

Item June 2017 June 2016 Change
Single Family (SF) Average Sale Price $491,891 $458,125 UP 7.37%
Multi-Family (MF) Average Sale Price $329,380 $290,830 UP 13.26%
Number of Properties Closed 5,516 5,249 UP 5.09%
Number of Properties Going Under Contract 5,688 5,623 UP 1.16%
Number Properties Available at End of Month 6,277 6,269 DOWN 0.67%
SF + MF 12-Month Rolling Average Sale Price* $410,022 $376,576 UP 8.88%
SF + MF 12-Month Rolling Average Number of Properties Closed* 53,423 51,637 UP 3.46%

*12-month periods from July 1, 2016 ending June 30, 2017 and July 1, 2015 ending June 30, 2016, respectively.

Data analyzed by CHR and based in whole or in part on info from REColorado®, Inc. (RECI). RECI and CHR do not guarantee, and are not responsible for, its accuracy. RECI content may not reflect all real estate activity in the market. Not all properties were listed or sold by CHR. The stats above are for sales activity in Adams, Arapahoe, Broomfield, Denver, Douglas, Elbert and Jefferson counties. It includes home sales handled by real estate agents though Metrolist/REColorado®, Inc., the MLS system serving the metro Denver area.

The stats above are for sales activity in Adams, Arapahoe, Broomfield, Denver, Douglas, Elbert and Jefferson counties. It includes home sales handled by real estate agents though Metrolist/REColorado®, Inc., the MLS system serving the metro Denver area.

You can see a more extensive breakout between the single family and multi-family segments of the market by clicking on the links at the end of this post.

If you like the look of those reports, we can produce one for you that is specific to your zip code and property type. The market is not uniform. Your part of town may be doing better or worse than the metro-wide averages.

Single Family Homes June 2017

Multi-Family Homes June 2017

By Mike Cooke Principal/Employing Broker

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