The Denver Real Estate Market results 2021 with Aleks Liubimyi and Tatiana Pevtsova Luxury Real Estate Agents is Colorado.
Much like the rest of the United States, the real estate market in Denver closed 2021 hotter than ever.
The demand for new homes remains sky high but the supply of new homes simply cannot keep up, leaving home prices high and prolonging the extreme seller’s market that we have seen since the start of the Coronavirus pandemic that took the nation and the world by storm.
The latest Market Trends Report has found that, in a region with over 1.4 million households, there are only 1,477 homes and condos available on the Denver market today. This contrasts to the end of 2020 when there were 2,541 homes available and at the end of 2019 when there were 5,037 homes on the market.
So what direction will the Denver real estate market go in 2022? Based on trends we are seeing today, the market will continue to be dominated by seller’s but there could be potential opportunities that make Denver a good place to purchase real estate in 2022.
Read on to find out more about the direction of the Denver real estate market and why now might be a surprisingly good time to buy in Denver.
Where the Denver Real Estate Market Came From, Aleks Liubimyi and Tatiana Pevtsova says:
In 2016, the average price for a home in the Denver metro area was $404,986 and the sales volume of all home purchases was $1.96 billion.
Denver has also struggled in the past decade with a lack of inventory since 2011, but now the tables have turned and the metro area is experiencing the opposite problem, driving home prices higher.
Denver has also enjoyed very low unemployment rates since 2010, seeing a 25% increase in employment earlier in the decade. The Coronavirus pandemic has thrown a wrench in things, as unemployment in the metro area jumped to 7.4% in 2020 up from 2.7% in 2019 but is starting to recover in recent years.
The Denver metro area is still seeing a steady growth in population, specifically young professionals continuing to move to the bustling area with a developing technology industry. The tech industry is also driving new companies and startups to the area, stirring up the local economy and generating the demand for corporate jobs.
Another bright spot in the Denver metro area real estate market is low interest rates. To provide perspective, the Denver area averaged a 5% interest rate in 2009 and is now seeing interest rates that closed 2020 at 3.1% on average.
Data on Today’s Market
The lack of supply in the Denver real estate market resulted in record price gains for the homes that were sold in 2021.
The Denver Post reports that the median price of single-family homes in Denver rose by almost 20% at the end of 2020 to $599,990.
Median prices of condos and townhomes are up as well, totaling a 15.6% increase year-over-year. Also, there were 63,684 residential properties that were closed last year which is only 183 fewer homes than 2020.
The increased sale price of homes has driven the volume of real estate transactions up to $39 billion from $33.3 billion in the year prior.
The amount of new listings has fallen 5.3% last year, which resulted in the fewest homes put on the market since 2016. To make matters worse, the homes that hit the market are selling on average in four days or less. In comparison, the year 2020 saw homes average seven days on the markets and 2019 homes were selling in 13 days on average.
The Bright Spots of the Denver Real Estate Market
There are some bright spots in the Denver real estate market that do present some opportunity for buyers with the resources to purchase property.
Many projections from experts predict that the Denver market will continue to see scarce supply in residential homes in the first half of 2022, but things could loosen up in the second half of the year.
With interest rates starting to creep up as the economy continues to navigate through the Covid variants, now is the time for potential Denver homeowners to purchase and lock in the low interest rates before they continue to rise back to pre-pandemic levels.
Refinance activity is starting to slow in the Denver area among homeowners, however refinancing numbers are still up from pre-pandemic levels.
Market Predictions in 2022
Denver has many factors that are driving up real estate values but that are helping the local economy.
The major factors that the Denver market will see affect real estate moving forward are:
- Real estate development
- Low interest rates
- Rise in employment
- Technology sector and millennial migration
The new construction and real estate development in Denver is expected to increase significantly in 2022.
In fact, the Downtown Denver Partnership CEO Tami Door says that the Denver economy is going to make a significantly quicker recovery than many other cities in the country. The continued increase in population is a very encouraging sign that a recovering economy is on the rise.
The Bottom Line
Although many things that the Denver real estate market is experiencing right now are similar to the trends of the entire country, there are some bright spots on the horizon that could make 2022 an ideal time to purchase a home in the area.
Experts predict that the prices of homes will start to decrease as the development of new homes increases and the population growth continues to rise.
The technology and startup scene is a very promising sign that will continue to attract new homebuyers into the area which will encourage economic recovery.
Be sure to check out all of the resources that we have on our website here and find out why 2022 is going to be the best time to buy a home in the Denver metro area.
Contact us directly and we will make sure you got your dream house. Cheers!