Yes, the Covid-19 pandemic hurt the real estate market in April, but it sure made a rebound in May! The 13-month chart below is for Adams, Arapahoe, Broomfield, Denver, Douglas and Jefferson counties.
Last week and this, you probably heard or read about how bad the real estate market was in April, and that was true here in the Denver Metro area, as it was throughout the country.
Pending sales of new and existing homes in April were roughly half the pending sales of April 2019. But pending sales in May surged to a number that was greater than the number for any month since before 2010, which is as far back as REcolorado’s statistics application goes.
The number of closings in May was somewhat low because of the low number of homes that went under contract in April. The number of closings in any given month is always within range of the number of pending transactions the previous month.
(Note: The number of pending and closed sales for May is from June 1st, It could go up as additional May contracts are reported on June 2nd & 3rd.)
It should be noted that, despite the lower number of pending and closed listings in April compared to 2019, the median sold price was much higher — $435,000 vs. $415,000 in April 2019. The median sold price for May was also higher than the median sold price that month in 2019.
It’s also worth noting how quickly listings went under contract in April and in May. April listings went under contract in 5 days (median figure), which was even faster than last year, while May listings went under contract in 8 days (median) vs. 7 days last year.
These statistics may come as a surprise to those who think that the real estate market is on a downturn because of Covid-19. I am as surprised as anyone at the resilience of our real estate market.
Driving the market is the fact that there is still a low supply of homes for sale and an over-supply of people needing or wanting to buy a home. That explains the low “Days in MLS” figure for April when the number of homes for sale was so low. Because so many sellers postponed putting their homes on the market during the lockdown, it became more of a seller’s market than before. That meant that the homes that were on the market had less competition for the large number of buyers.
Given what we’re seeing now, it’s hard to be pessimistic about the future of our real estate market, however pessimistic we might be about the country as a whole, given the rioting in multiple cities around the country, including Denver. We’ll see in June how much impact that may have.
Another wildcard is the possible resurgence of the coronavirus, given how our state, like others, has yielded to pressure to reopen earlier than CDC guidelines recommended. A resurgence could result in another stay-at-home order.