While Market Activity Shows Signs of Slowing, Prices Are Actually Rising

Real_Estate_Today_bylineLast week I documented how our real estate market is showing signs of slowing. In that column I noted an increase in the number of price reductions for metro area listings and compared statistics from this summer with those from last summer, showing how the ratio of sold price to original listing price and the median days on market suggest a slowing in our real estate market.

One reader asked whether prices were also leveling off or falling, so this week I am presenting that data. As documented in the chart below, the answer is pretty obvious — prices have increased from 6.8% to 9.8% year-over-year this summer, and price per square foot has increased from 5.4% to 9.4% year-over-year. That’s comparable to or greater than the increases experienced in previous summers.

Metro_price_trend_vs_psf

That presents an interesting dichotomy. We are not seeing as many quick sales and multiple offers, and we are seeing more price reductions than last year, yet the median sales price is increasing. It’s hard to come up with a reasonable explanation of what’s going on, but I’ll keep working on it!

I’ll be curious to see how market activity and price changes look this coming winter compared to last winter.  In the past I have pointed out (more than once!) that winter can be the best time to sell a home. That’s because there are fewer listings yet lots of buyers are still getting email alerts from the MLS whenever a new listing matches their search criteria. I myself have 60 different clients receiving email alerts based on their different search criteria. You can be sure that when these would-be buyers get an email describing a house they want to see, they will call me to see it — even on Christmas eve or in a snow storm!

That’s the nature of our changed real estate business. Buyers and not their agents are doing their searching and finding online, then asking their agents to set a showing.

Remember: Summer may be the “listing season” in real estate, but there is no one “selling season.”

 

Author: Golden Real Estate, Inc.

Golden Real Estate is a prominent member of the Denver/Jefferson County real estate scene. Based in Golden, we service both Denver and Jeffco, representing both buyers and sellers. We're well known for Broker Jim Smith's weekly "Real Estate Today" column published in the Denver and Jeffco editions of the Denver Post's YourHub section each Thursday. The column also appears in several weekly newspapers and is archived at www.JimSmithColumns.com. We have nine agents, all of whom are Realtors and EcoBrokers. Our office is solar powered and several of us drive electrics cars. Known for our sustainable practices, we accept polystyrene (aka "Styrofoam") for recycling, keeping 200 cubic yards per year out of area landfills.

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