Illustration: Sarah Grillo/Axios
No doubt Denver is experiencing a housing frenzy. The question is: Will the boom bust?
What they’re saying: “I don’t think there’s any chance of a bubble here. … We have people with a lot of equity,” said real estate broker John Danyliw, who has worked in the local market for 50 years.
- “We’re going to be in this marketplace for quite a while. And hopefully we will not become California,” he tells Axios.
State of play: House hunters in Denver are battling bidding wars, soaring prices and the pressure to make fast, rash decisions — including waiving their right to a property inspection — before their home of choice gets snapped up by another buyer.
- High demand continues to outstrip inventory across metro Denver, with the number of houses for sale dipping to historic lows, thanks in part to low mortgage rates that currently hover around 3%.
- Home value appreciation continues to increase into the high double-digits.
- Meanwhile, local realtors are undergoing the painstaking process of navigating an unprecedented market.
Of note: Denver’s housing woes reflect a national trend, with the country’s available homes hitting record lows.
Data: National Association of Realtors; Chart: Axios Visuals
The big picture: Industry leaders predict the market won’t slow down any time soon — meaning waiting to buy could be more costly in the long run.
- For example, holding off just one month to buy a $500,000 property from the end of February to the end of March would have cost an extra $35,000, according to the latest Denver Metro Association of Realtors data.
Between the lines: Most buyers in Denver aren’t profit-chasing investors, housing experts tell Axios, even though that’s taking place elsewhere.
- “The investors I’ve talked to in this market don’t see any value here. … They’d be buying at the high side, which is not typically investors’ mantra,” said Andrew Schiff, the owner and managing broker of Scout Real Estate Group.
By the numbers: The median sales price for a metro Denver home in March was $500K, up by about 12% from last year, according to DMAR.
- Single-family homes are selling this year nearly 37% faster than in 2020.
Flashback: There were more than 25,500 properties for sale in March 2008 compared to less than 2,000 today, DMAR reports.
The bottom line: “If rates remain low, demand picks up with new jobs, there’s no increase in supply, and the only thing that moves is home prices, until people get priced out. … That would mean we are creating a divided society of haves and have-nots,” National Association of Realtors chief economist Lawrence Yun tells Axios’ Felix Salmon.