As we enter the summer of 2024, the front range real estate market is undergoing significant shifts. The latest data from the MLS summary for June paints a complex picture of rising inventory, cautious buyers, and fluctuating prices. Let's delve into the key trends and explore what they mean for buyers and sellers in the current market.
The Impact of the NAR Settlement
You might have heard about the recent National Association of Realtors (NAR) settlement. It's meant to make real estate transactions more transparent, but it has caused some confusion, especially with the way the media has reported it. Don't worry—I'm here to help. As your real estate agent, I stay on top of all market changes, new legislation, and best practices, so you get accurate, up-to-date information.
Increased Inventory and What It Means
Active Listings:
In June 2024, active listings reached 10,215, a significant 68% increase from 6,070 in June 2023, surpassing pre-COVID levels (June 2019: 9,520). Denver ranks 12th nationally for residents moving out of the state. This surge in inventory suggests a potential softening of prices in the fall, indicating a market where sellers might need to adjust their expectations and strategies due to the rapid build-up of available homes.
New Listings:
There was a slight increase in new listings from 5,650 in June 2023 to 5,825 in June 2024, marking a 3% rise. Year-to-date new listings have surged by 16% compared to 2023.
Pending Sales:
Pending sales saw a slight decrease from 4,085 in June 2023 to 4,055 in June 2024, down by 1%.
Closed Sales:
Closed sales experienced a significant drop from 4,420 in June 2023 to 3,680 in June 2024, down by 17%. The reduction in pending and closed sales highlights buyer hesitation and increasing contract terminations. Sellers may need to be more flexible and offer solutions to keep deals from falling through.
Home Prices:
The average home price increased slightly from $710k in June 2023 to $725k in June 2024, up by 2%. Despite this, buyers remain cautious, and sellers often overprice properties, leading to longer times on the market.
Days on Market (DOM):
The average days on market increased from 25 days in June 2023 to 30 days in June 2024, up by 17%. As inventory grows, buyers who previously struggled to compete have new opportunities. However, sellers must recognize the need for realistic pricing and robust marketing to attract these cautious buyers.
Strategic Considerations for Sellers
Given the current market conditions, this is not the ideal time for sellers to experiment with pricing or limit their marketing efforts. With showings and sales down, sellers must:
Price homes competitively to attract buyers. It is not a good time to “test” the market. Even the best marketing strategies will not sell an overpriced home. If you are not getting showings or offers, your home is overpriced.
Invest in comprehensive marketing strategies to stand out in a crowded market.
Be prepared to negotiate and offer concessions to close deals.
Don’t dig in your heels. Buyers have more choices now than they have had for a while. It is still a good time to sell, but sellers don’t have the leverage they had in the past.
Conclusion
The Denver real estate market is experiencing a period of adjustment with increased inventory, cautious buyers, and steady prices. Understanding the implications of the NAR settlement and staying informed about market trends will be essential for both buyers and sellers. As we move through the summer, flexibility, realistic pricing, and effective marketing will be key to navigating this evolving landscape successfully.
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