We've all be anxiously awaiting the Denver real estate statistics to see how sales went after the tax rebate was over. The results are in and frankly we are a little surprised. The numbers are better than we expected.
July 8, 2010
- The average sales price jumped 10% in June over the month of May, and 6% over June 2009. Best reason why: an increase in non-tax credit supported contracts written in May. The months of May and June are traditionally the spring transferring months for the corporate buyer, and that seems to holding true in 2010. By advancing the first time buyer market to March and April, the average sale price increased because the transferring buyer is in the $400,000 price range this year, and there were simply less low price buyers in play in June.
- 2. Average prices up, total sales down, but not out. The decrease in total closed sales was only 319 from May and 140 less than June of 2009. Important consideration: The first half year to date sales totaled 20,990 compared to 19,363 units sold YTD 2009, an increase of 8%.
- The Total Available Inventory is creeping up. (an increase of 8.8% over June of 2009) This is a concern. It is reasonable to assume that homes owners buoyed by the good sales numbers of April are trying to take advantage of the market and sell their present home. While we are some ways away from a flood of inventory, it will take very little excess inventory to drive the prices down below the last two years low levels in the latter half of 2010. While the much discussed “shadow inventory” seems to be barely visible in the Denver area market, the overall economy is still very fragile. (Positive sign: RTD letting contract to build the commuter rail to DIA, etc. will pump 2 billion plus $$ into the local economy and add 3000 jobs.)
- Postscript to the above note: it is all about employment!!
- 5. The Average Days on Market (DOM) for May was the lowest in a long time. That number increased to 82 days in June, a factor of increased inventory and less total sales. 82 average days on market is still very good.
- 6. 3885 = the total number of contracts written in June, 2010. 5,664 = the total number of contracts written in May of 2010. That is 1779 less units of inventory contracted for sale, which negatively affects the work load of REALTORs, Title Companies and their Escrow departments, mortgage lenders, home inspectors, appraisers, etc.
- Freddie and Fannie national mortgage rates are 4.57% today. Those low rates are providing some boost to the housing market, at least for those that can take advantage of the moment.
Pretty graphs to follow tomorrow!