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Buyers demand more concessions, but Denver housing prices hold steady

Although the Denver metro’s median close price held steady at $585,000 in October, the close-price-to-list-price ratio dropped slightly to 98.9% as more homebuyers demanded concessions from sellers.

According to the monthly report from the Denver Metro Association of Realtors, in October, 57.9% percent of closed transactions included an average seller concession of $9,390.

That’s up from September, which recorded 56.4% of closings with an average seller concession of $9,214. In October 2022, 50.7% of closed transactions required sellers to pay an average concession of $7,553.

With interest rates hovering above 8%, most buyers used those concessions to buy down their interest rates or cover closing costs.

“Concessions — no matter what market one is in — seem to be the name of the game. I recently closed on several properties at the $1.3 million price point,” said Andrew Abrams with Abrams Momentum Group, who’s also a DMAR Market Trends Committee member. “One of the properties had $75,000 in concessions, and the other had $25,000 in concessions.”

October statistics

According to the monthly report:

  • The number of closed properties dropped 12% from September to 2,986.
  • Months of inventory increased by 4% to 2.5 despite the fact the number of active listings dropped 2% from September to 7,482.
  • The average number of listings for October is 14,755, according to a historical average from 1985 to 2022. The record high number of listings came in October 2006 with 29,722 available homes. The record low fell in 2021 with 3,376.
  • The median number of days in MLS increased 14% to 16.

“Despite a shifting market and general uncertainty, people are still buying and selling homes,” said Libby Levinson-Katz, market trends committee chairwoman.

Moving toward balance?

As the market becomes more balanced, it also resembles the pre-COVID market of 2019, Levinson-Katz said.

“Ultimately, sellers need to get the pandemic years out of their minds. Sellers must focus on value and put themselves in the buyer’s shoes. Buyers are no longer willing to overpay and, as such, pricing is the No. 1 key in this market to sell a home,” she said in comments included with the report.

Buyers have more options, and those who chose not to hibernate this winter will face less competition and sellers who are motivated to sell before the end of the year, she said.

Michelle Schwinghammer with Re/Max Alliance, who’s also a marketing committee member, said buyers have seasonal opportunities.

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“A window of opportunity exists right now, and prepared buyers are seizing it, often with generous seller assistance for rate buydowns and other incentives to close by year’s end,” she said.

She cautions sellers to be realistic.

“Your pool of prospects is smaller and more tentative than it was before. Meet and welcome buyers on realistic and attractive terms for your best chance to sell in a time frame that serves your long-term goals.”

The news and editorial staffs of The Denver Post had no role in this post’s preparation.

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