Outside of California’s biggest cities, no other housing market is cooling as quickly this year as is metro Denver’s, according to an analysis from Zillow.
“It is no surprise that the markets which pushed the bounds of affordability over the housing recovery are now experiencing significant cooling,” Skylar Olsen, Zillow’s director of economic research, said in the report.
As prices rose, mortgage payments and down payments outstripped incomes, causing buyer demand to exhaust itself, Olsen said. Buyers who didn’t get priced out can now afford to take more time to decide what to do, as more inventory comes into play and listings take longer to move.
Zillow determines how quickly a given market is cooling down or heating up by looking at the share of listings that adjust lower, the final sales price as a share of the listing price, and the change in the average number of days a home spends on the market.
In metro Denver, it found that 18 percent of listings took a price cut in January, compared with 11 percent in January 2018. Homes sold for 97 percent of list price in January, compared to 99 percent a year earlier. And homes are taking a week longer to sell: 65 days versus 58 days.
RELATED: Denver home sellers’ “magic window” for listing properties is early May
A monthly update from the Denver Metro Association of Realtors also reported that the median price of both homes and condos sold in metro Denver in February turned negative for the first time in seven years.
None of those shifts are extreme, but they show a change is underway. Combine the three Zillow measures and metro Denver’s housing market ranks fifth overall for how fast it is cooling down, behind the California metros of San Jose, San Francisco, San Diego and Los Angeles.
Behind Denver on the cooling scale are Dallas, Seattle, Sacramento and Portland, Ore.
As some markets cool, others are actually heating up. They stretch across the country, but with the exception of New York City, what they seem to share in common is a lower median home value than the markets that are cooling down. Buyers are still willing to buy — when they can afford it.
Related Articles
-
The Yelp for renters: Denver-based Renting Right seeks to give tenants the inside scoop
-
Metro Denver home prices drop in February for first time in 7 years
-
Denver home sellers’ “magic window” for listing properties is early May
-
Denver-area residents house hop faster than most of the U.S.
-
Home prices actually fall in Boulder, Denver and Douglas counties. Is it a blip, or a trend?
Leading Zillow’s “heating up” list this year are Miami and Fort Lauderdale; Houston; Pittsburgh; Philadelphia and St. Louis. In metro Denver, the median home value as estimated by Zillow is $405,300. In Miami, it is $283,800. In Houston, it is $205,500 and in Pittsburgh, it is $143,400.
But buyers shouldn’t yank the lid off the Instant Pot just yet. Things are still under pressure, and metro Denver remains among the most favorable markets for sellers even as it cools down from super-heated levels.
