Your October Housing Market Update for the Denver Area
Here’s what you need to know about the latest news from our market.
It's hard to believe that October is already upon us, but that means it's time to delve into the real estate market. We now have the September data that covers the 11 counties comprising the Denver metro area. Let’s get into the data and see what it has to say about our market.
Interestingly, the median closed price increased from $582,000 to $585,000. This uptick in prices is intriguing because it coincides with a growing strain in the market, unlike anything we've seen in many years. The primary culprit behind this strain is the continuous rise in mortgage rates. Over the past few weeks, we've witnessed rates climbing from the mid-7% range to 8% or even higher. It's a challenge to grapple with, considering we haven't encountered 8% mortgage rates in a substantial amount of time. Moreover, the equation to make monthly payments work is becoming more complex, making it increasingly difficult for buyers to secure pre-approvals for property purchases.
Taking a closer look at these market metrics, we can see the strain becoming evident. Between August and September, there was a nearly 21% decline in the number of closed home transactions. While some of this drop might be attributed to seasonality, a significant portion is due to the escalating mortgage rates.
"We’ll keep you updated on any new developments in our market."
Examining the number of active listings at the end of September, we observed an 11% increase, which is quite notable. Interestingly, even though the number of new listings entering the market in September decreased by approximately 6%, the number of active listings continued to rise. Lastly, there was a notable 9% decrease in the number of pending listings between August and September.
Although fewer properties are entering the market and fewer are pending, these statistics are indicative of the significant impact of rising mortgage rates. We're hopeful that this challenging phase will subside, and mortgage rates will ease sooner rather than later. Most importantly, we're closely monitoring the actions of the Federal Reserve, inflation trends, the economic landscape, and GDP developments.
If you have questions about this topic or anything else, please call or email me. I look forward to speaking with you.