The Lack of New Listings is NOT the Problem

Here is the April Stats Report for our 7-county Denver Metro area courtesy of REColorado and SMDRA. And remember last April the numbers were much lower as we were in COVID lockdown so, we need to focus more on the numbers from 2 years ago for a much better comparison.
· 5,203 properties sold last month, up 40.7% from last year and up 6.6% from April 2019.
· Attached home sales last month totaled 1,554, an increase of 50% from last year when no one wanted to buy an attached home. Sales are still up 3.1% from 2 years ago.
· There were 3,649 detached home sales last month up 37.1% from last April and up 8.2% from 2 years ago.
· Homeowners provided 6,335 new listings last month, an increase of 41.2% from last April and a drop of 8.5% from April 2019.
· We saw 1,964 attached homes as new listings last month, up 46.7% from last year and a small increase of 1.5% from April 2019.
· 4,371 detached homeowners listed their homes for sale in April, an increase of 38.9% from last year and a DROP of 12.4% from 2 years ago.
· Buyers placed 5,639 properties under contract last month, up 94% from last year’s Covid-induced shutdowns and this was a tiny 1% increase from 2 years ago.

· The average closed to original list price ratio hit 104.5% in April, up from 99.5% last April.
· Even attached homes sold for 102.4% of original list price.
· Detached homes sold for 105.4% of original list price or about $37k above list price!
· From 2015 to 2018 properties sold for an average of 100.4% of original list price and now we are at 104.5%. This is a great indicator of how much stronger or crazier our RE market is.
· This is why I have been saying the list price is NOT THE HOME’S VALUE! The list price is the first bid in the auction.
· Average days in market dropped from 20 to 12 days this April.
· Median days in market dropped from 5 to 4 days this April.
· Median days in market was below 10 days for all price ranges under $1 million. In the $1 to $2 million price range median days in market is 13.
· Have clients looking for a deal? The $2 to $3 million price range has the highest median days in market at 32 days.
· We ended April with only 1,857 properties for sale, down an astounding 69% from last year!
· This puts “months” of inventory at 0.36 months or 10.7 days. This is an increase of 1 day from March. Woohoo!

· The average closed price last month was an astonishing $615,510, an increase of 24.1% from last year and a 26.4% increase from 2 years ago.
· The attached home average sold price last month was $440,268, an increase of 16.7% and a 21.2% increase from 2 years ago.
· The detached home average sold price last month was $690,140, a 27.3% increase from last year and 2019 as average detached home prices didn’t rise from April 2019 to April 2020.
· The median closed price last month was $524,500, an increase of 20.3% from 12 months ago and an increase of 25.9% from 2 years ago.
· The attached home median sold price last month was $374,500, up 17% from a year ago and an increase of 24.8% from 2 years ago.
· The detached home median sold price last month was $578k, up 22.5% from 12 months ago and prices were up 27% from 2 years ago.

To all the “Experts” like CoreLogic who predicted that metro Denver home prices would drop by 11% by now last year, please SHUT UP!
· The average sold price for all properties increased by $120k in the last 12 months.
· The average sold price for detached homes rose by $148k and attached homes saw their average sold prices increase by $63k.
· The median sold price for all properties increased by $89k.
· Even the median sold price for attached homes increased by $54k and the median sold price for detached homes rose by an amazing $106k.
I remember talking with several prospective home buyers last spring who decided they would wait to buy as they thought prices would drop and I told them then that would NOT happen. One of them was a former tenant and I saw her paper file in my cabinet and I shredded it this past weekend as she could barely buy something last year price-wise and cash-wise, now she has no chance of buying a home on the Front Range.

Here are 3 facts I want to point out that I saw in a Denver Post story from DMAR’s April report—
· Luxury homes, those selling for > $1 million, are selling in one-third the time and at double the pace from recent years.
· In the first 4 months of 2018, 2019, and 2020 the number of $1 million plus homes that sold in metro Denver ran from 649-661 sales, a very tight range.
· This year through April we have seen 1,353 homes sell for more than $1 million!

This is amazing! Of course I am sure some of these homes were listed for less than $1 million, but sold for above $1 million after the bidding war was completed. This fact is also increasing both average and median sold prices by a substantial margin.

Analysis and Observations

· New listings in April from 2014-2019 averaged 6,445, so new listings are only down by 1.7% from those years.
· We have had 20,352 new listings year to date this year and from 2014-2019 we averaged 20,330 new listings year to date.

Thus, it’s hard to say we don’t have enough new listings. So, what’s causing the problem? DEMAND is the problem.
· Pendings so far this year are up 6% from our best year ever (2019).
· Pendings year to date from 2014-2019 averaged 17,857 and this year we have seen 19,543 properties go under contract, an increase of 9.4% from our 6-year average.
· Closings this April are up 6.6% from 2019 our second-best year ever.
· From 2014-2019 we saw an average of 4,590 closings in April. This year we had 5,203 closings, an increase of 13.4%.
· Closings year to date from 2014-2019 averaged 14,674. This year we have seen 17,005 properties sell, an increase of 15.9%.

Why is there so much demand?
· COVID has caused people to look for homes with more SPACE, both inside their home and outside their home.
· The Fed’s Quantitative Easing has made homeownership much more affordable with record low mortgage rates.
· Congress has given many consumers thousands of dollars of “free” money and only about 1/3 of that money has been spent shopping or entertainment. Instead, hundreds of billions of dollars have flowed into the stock market and the stock market has doubled in value and people are withdrawing their stock holdings and buying real estate now.
· People with white-collar jobs have been seeing large income increases of over 5% year over year and this is allowing them to buy homes.
· Finally, over 4 million people will turn 33 years old this year, which is the average age of a FTHB and the American Dream of Homeownership is alive and well.