Life, you might say, is a composite of highs and lows. There are good times and there are not-so-good times. Metro Denver real estate sales follow similar seasons. "Where are we today?" - It's a good question.
Today, it appears, we're in a period of regeneration. The Denver real estate market is settling out; it's regrouping.
Of course, real estate is "location, location, location" and we'll examine the locational differences in this blog during the next few days. But we can extrapolate important facts in the process of studying metro-wide statistics.
In 2006, 5,091 single family homes were sold in Metro Denver. In 2007, that number declined slightly to 4,813 sales; in 2008 there were 4,934.
Today, real estate analysts anticipate 3,900 single family home sales in 2009. That's a steep 23.50% decline in home sales since 2006.
Yet there's a silver lining: Outpacing the decline in Denver home sales has been the decline in inventory. And that's why Denver isn't experiencing a textbook buyer's market. The inventory of available single family homes has decreased nearly 29% since 2006. Stated most succinctly, today's buyers have fewer choices than Denver homebuyers in 2006.
In a traditional buyer's market, the pool of sellers exceeds the pool of buyers. And the sellers have equity in their real estate investment; they can adjust their price according to market demand. Today, however, sellers are not in the equity position needed to lower their price. And many sellers are multinational financial institutions - banks - who establish home prices not on market trends, but upon internal loss mitigation guidelines.
Are we in a distinctly low real estate market period? It's certainly lower, metro-wide, than 2006. However, neighborhood analysis will point to some different trend lines. Tomorrow we'll look at Wash Park.
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