The Denver real estate market has made headlines for years as one of the top markets in the US, but the uncertainty with the coronavirus will be a test for Denver real estate. A recent report from the Denver Metro Association of Realtors (DMAR) revealed that an astounding 761 homes were taken off the market by home sellers in Denver and the metro area. Of the 761 homes taken off the market, DMAR reported that 625 were withdrawn from the market because of COVID-19. DMAR went on to share the comparison in the withdrawn home statistic of 761 homes in March 2020, the next highest was 477 homes in March 2003. It is clear the real estate market not only in Denver, but all over the country and the world is taking a pause.
The local MLS decided they would no longer allow Realtors to post their open houses on REcolorado.com or MLS. This has obviously cut down on showing traffic. Below is a graph of showing activity compared to last year, which is down over 66 percent. We are hearing more clients request video or virtual tours, Google Meet, Zoom or FaceTime calls.
March started off with a much needed increase in housing inventory with over 30% more new listings hitting the market. The number of homes under contract was up over 8 percent compared to last month. The number of home sales compared to last month was up over 12 percent. The average price for a Denver and metro area single-family home set a new record at $513,526. The average days on market was 29 days compared to last months 38 days on market.
A noteworthy stat from the DMAR Market Trends Committee, “Last March we closed the most single-family homes in the $300,000 to $399,000 range. This March, the highest number of sales were in the $500,000 to $749,000 range. This could demonstrate that this spring's market was shaping up to be a scorcher.”
The luxury market in Denver had 202 home sales over the $1 million dollar mark. This is up over 30 percent compared to February and over 13 percent compared to last year. The Denver luxury market had over $318 billion in home sales, which is up over 15 percent from last year. The highest luxury single-family home was in Cherry Hills Village and fetched $4.297 million. The luxury Denver condo that took home the prize for highest price in March home sale went for $2.775 million.
The number of days on market for a Denver luxury single-family home dropped from 61 days on the market to a median of 29 days on the market. One indicator to watch in the luxury segment is the close price to list price ratio, which dropped .61 percent, according to DMAR. This could mean more negotiating room for luxury buyers.
A few other new noteworthy changes in the real estate market are as follows:
- “The National Association of REALTORS® sent a letter to Congress urging lawmakers to include policy in coronavirus response legislation that would pave the way for remote notarizations nationally and make it easier to complete transactions virtually. The Securing and Enabling Commerce Using Remote and Electronic Notarization Act of 2020, also known as the SECURE Notarization Act, was introduced March 24, 2020 and has already garnered broad support across the real estate industry.”
- There are some title companies that are now doing drive-thru or curbside closing, as well as “virtual mail-out” options.
- There is a new contract that buyers and sellers have to sign called the COVID-19 Addendum. The addendum permits contract extension should a seller or homebuyer get exposed to the coronavirus or if either party must be quarantined.
- The COVID Stimulus Package offers homeowners forbearance options from 90 to 180 days. Please note this does not mean you do not have to pay or forgiveness, so please ask your lender or service provider for more information.