Increasing housing inventory wasn’t enough to slow down the pace of home price appreciations in Denver last month, according to the latest market data report from a realtors’ group.
Overall, Denver had more than 3,200 active listings at the end of April, representing a 44% increase from the previous month and a greater-than 23% increase year-over-year, according to the Denver Metro Association of Realtors’ (DMAR) data. Even so, the average price for all residential homes topped $724,000 last month, a 3% climb from March and a 17% increase from last year.
One of the biggest contributing factors to the continued rise of home prices is interest rates, according to DMAR. As of May 9, the personal finance website NerdWallet measured the average 30-year mortgage rate at approximately 5.4%, which is nearly twice as high as the website measured at this time last year.
“While buyers may be thinking they overpaid if they bought two months ago, this is not the case,” Andrew Abrams, a metro Denver realtor and chair of the DMAR’s Market Trends Committee, said in a statement. “They likely got a slightly lower interest rate and the market is continuing to rise, just not as fast.”
Single-unit homes, which DMAR refers to as “detached,” outpaced the total market in terms of price appreciation and inventory growth last month, according to the report. Detached homes saw their average price climb to more than $825,000 despite inventory climbing up to 2,445 by the end of the month, a nearly 50% year-over-year increase.
The average price of $825,000 for detached homes also represents a more than 18% climb from last year, the report said.
The number of homes sold during April also increased by more than 4% up to 3,425, according to DMAR. However, this total is more than 12% below the rate measured in April 2021, which has some realtors worried that the market may be topping out.
“There will still be bidding wars, appraisal gaps and limited inspection items on future properties, but the frequency of those will be less,” Abrams said.
On the other hand, the number of townhomes and condos – which are referred to as “attached” properties – received less attention than detached homes last month.
Denver’s active listings for attached properties grew by 27% month-over-month up to 759 by the end of April, but that total is more than 20% below the activity levels measured at this time last year.
The average sale price for attached homes dipped slightly to just over $495,000, though it is still more than 12% above the average price from April 2021.
“In the chaos of the recent market, buyers had been waiving their inspections, doing full appraisal gaps and even offering to make their earnest money non-refundable before getting an inspection,” Abrams said. “Now, we are shifting to a more responsible market.”
This article was originally posted on Denver housing inventory gains in April can’t slow price appreciation