Statistics, Oddly, Seem Not to Support the Idea That the Real Estate Market Is Slowing Down  

We all know that the real estate market has slowed down since the dramatic April increase in mortgage rates — right?

Seeking to document and measure that slowdown, I checked the statistics available to me as a member of REcolorado, Denver’s MLS. Below is a chart of the statistics I gathered for the period Jan. 2021 to present. Analyzing that chart, you can see that while there are fewer active listings this May than a year ago, there are roughly the same number of sold listings — and they went under contract just as quickly, with a median days on the MLS (DOM) of just 4. And, more significantly, the median sold price this May was nearly $100,000 higher than May 2021, with a slightly higher ratio of sold price to listing price. April’s statistics year-over-year were even more impressive.

The smaller chart is a 7-day residential “Market Watch” widget that I copied and pasted from the MLS on Tuesday morning. Although I don’t know how to replicate what that chart would have looked like a year ago, it’s safe to say that it’s much different — and does not paint the same picture as the larger chart above. It definitely shows a vibrant market with lots of new, pending and closed listings, but the number of price reductions must be significantly higher than they were a year ago — and 10 times the number of price increases.

So, what does all this data mean for the average homeowner thinking of listing his or her home for sale?

The number of price decreases suggests to me that too many sellers are starting out with a listing price that might have worked in the past, but that is too aggressive for the current market. While the median days-on-MLS is still only 4, you can be sure that those listings lowered their prices a week or more into their time on the MLS.  At the same time, that low days-on-MLS number tells you that the sellers who price their home correctly outnumber those who do not. Good for them. That’s the group you want to be in!

Another obvious conclusion is that while the dramatic increase in mortgage interest rates has impacted many buyers, there are enough buyers who are paying cash or are not deterred by the higher rates, which are still historically low. (When I bought my first home in 1983, I benefited from a subsidized interest rate of “only” 13%!)

Bottom line: Sellers should price their homes less aggressively. Buyers should focus on homes with a DOM over 10 days. That’s where the best deals can be found.

The Current Surge in Sold Prices of Homes Will Cause a Jump in 2023-2024 Property Taxes  

In Colorado, property taxes are based on a calculation of what each property might have sold for on June 30th of the prior even-numbered year.

That means the property taxes for 2023 and 2024 will be based on what your home could have sold for on June 30, 2022. Given the crazy surge in home prices, you could see a 30% or higher jump in your property’s assessed valuation and therefore a 30% or higher jump in your property taxes for the next two years. 

The chart below shows the likely impact of the current run-up in median prices compared to the median prices in prior Junes of even-numbered years, based on data from REcolorado. Although your home’s valuation will be based on the sales of comparable homes near yours leading up to June 30, 2022, the fact that the median sold price of residential properties metro-wide will have increased by over 30% from June 30, 2020, suggests that your home’s valuation and therefore your taxes could rise by 30 percent or more.

I’ve estimated (conservatively) that the median sold price in June will be $570,000 because the median sold price was already $540,000 in February. That is already a 27.7% increase over June 2020.

That, however, is an average for the entire Denver metro area, defined for these purposes as within 25 miles of the state capitol.  There are locales within the metro area where the increase in values over the last two years have approached 35% or more. Here is how that metro-wide 27.7% average increase of Feb. 2022 over June 2020 breaks down by county:

Denver County—19.5%

Jefferson County—30.1%

Douglas County—31.9%

Adams County—28.6%

Arapahoe County—27.1%

Boulder County—40.7%

Gilpin County—42.4%

The appreciation also varies greatly by city addresses:

Golden addresses—15.9%

Littleton addresses—26.0%

Arvada addresses—33.0%

Broomfield—27.2%

Centennial—36.9%

Aurora—30.5%

Highlands Ranch—31.8%

Castle Rock—36.5%

So, keep an eye on what homes like yours are selling for this April, May and June of this year to get a sense of what the county assessor’s valuation of your home will look like when you get that notification in May 2023.

About 50 readers are receiving “neighborhood alerts” from me.  These are email alerts regarding all MLS listings within your particular neighborhood. Usually, the alerts cover a certain subdivision or ZIP code, but they could be structured to include only listings which are comparable to your own home. For example, if you have a 1970s ranch home, I could set up an alert that only includes ranch-style homes built between 1960 and 1990 within a half mile or mile of your home. This will give you the best indication of how the value of your own home may be calculated by your county assessor. Feel free to email me at my address below to request such an alert or to modify the alert I am already sending you.

MLS Statistics Document the Return of Last Year’s Out-of-Control Seller’s Market  

One of the most dependable indicators of a strong “seller’s market” is the number of listings which sell above their listing price, and by how much. Another is the number of days that a listing is on the MLS (“DOM”) before going under contract.

As shown in the chart below, drawn from REcolorado’s data for the period of January 2021 through last month, the seller’s market peaked in May and June of last year but has now surged again. All indications are that the surge will continue through the spring.

Average DOM is always higher than median DOM because there are many homes that languish on the market unsold because they are overpriced, or for another reason. What’s remarkable about this sellers market was how low the average DOM went as even those hard-to-sell homes attracted buyers.     

As with the previous surge, the average DOM has sunk below 20 while the median DOM has revisited its all-time low of 4 days on the MLS.

(Note: These statistics are for residential listings in the metro Denver area, which I’ve defined here as within a 25-mile radius of the State Capitol.)

The rising cost of money — that is, the increase in mortgage rates projected for this year — will lure many buyers “off the fence” hoping a buy a home before interest rates rise further.

I foresee a stronger than usual seasonal jump in the number of new listings as spring arrives.

Many people believe, erroneously, that the best time to list a home is in the spring, so those people will be putting their homes up for sale in the coming weeks. In addition, as I wrote last week, many homeowners who weren’t thinking of selling before are likely to decide it’s a good time to “cash out.” But I don’t foresee that increase in supply going far to meet the needs of today’s home buyers, and I don’t see prices leveling off, much less declining.

It surprises many of us that homes are appraising at the high prices they are selling for, but when a winning bidder waives appraisal objection to win a bidding war — which is almost common nowadays — that sale becomes a comp that supports future appraisals at the same price or higher. (On the appraisal form, there’s a place to indicate a rising, falling or stable market, and when an appraiser checks the box that it’s a rising market, that gives him or her more leeway to appraise a home higher than recent comparable sales might otherwise justify, further fueling the frenzy.)

The real estate market is becoming less and less predictable, along with other elements of our economy and society. War could be imminent or a new Covid variant might come. God only knows!

The Year in Review: 2021 Saw Unprecedented Real Estate Changes  

I don’t think anyone in real estate foresaw the amazing year which is now coming to an end, any more than they foresaw the pandemic’s arrival in March 2020 and its effect on that year’s real estate market.

Even though the pandemic spanned both years, the two years display notably different patterns when it comes to home sales.

Below are four charts derived from REcolorado statistics, the first three of which span the time from Jan 1, 2020 through Dec. 27, 2021, when I researched this article. Final figures for December 2021 are not yet in but shouldn’t greatly affect that month’s stats. Because REcolorado is a statewide MLS, I limited the analysis to listings within 20 miles of downtown Denver, which includes the metro area except for the city of Boulder.

The most spectacular effect of the pandemic is shown in the top left chart, as homes started going under contract in a week or less (median), down from 26 median days in MLS in January 2020. Despite that, you can see that the active inventory of listings shot up from about 5,000 before the pandemic to a high of nearly 8,000 in May 2020. Inventory only started dropping at the end of that first summer, but  it’s apparent that the decline in active listings was not for lack of new listings but rather because most listings which came on the MLS went under contract within a week, causing the number of unsold listings to decrease.

The third chart has what looks to be an uninteresting top line, but that’s only because of the compressed scale. It actually reveals a dramatic change which only occurred in the second year of the pandemic. The ratio of closed price to listing price was only 99.3% in January 2020, but it rose to 100% in February and stayed there through January 2021. It surged to almost 105% in June 2021 and was still at 100.6% in November.

What has happened in the luxury market is even more pronounced. The fourth chart, going back six years, shows how the number of closings over $1 million has surged from well below 100 in early 2016 to a high of 547 in June 2021, with the two pandemic years showing the most outstanding growth. On the same chart you can see that the change in price per finished square foot was up and down showing a gradual increase month-to-month from 2016 to 2019, but then took on a sharper and steadier increase during the pandemic.

There does seem to be a cause-and-effect relationship between the pandemic and the real estate market. In the beginning, we could conclude that the lockdown was causing people to seek bigger homes to accommodate working from home (and schooling at home). Also, it seems that some couples broke up under the strain of being together 24/7, further increasing the demand side of the real estate market.

Although the government is reluctant to reimpose a lockdown for pretty obvious reasons, the pandemic is still a factor and can be expected to drive further real estate activity for months to come, even as interest rates rise gradually.

(Actually, rising interest rates can stimulate buying activity, because once buyers see rates rising and realize they’ll continue to rise, they want to buy before rates rise much further.)

Happy Thanksgiving! Here Are Some Things That We’re Grateful for This Year  

2021 has been a difficult year for everyone, but it has also been a year of growth for Golden Real Estate and for me personally. Fortunately, Rita and I have escaped infection by Covid-19. We are all fully vaccinated, and Rita and I plus a couple broker associates have received our booster shots.

We’ll be closing out 2021 with over $50 million in closed sales volume, compared to less than $32 million in 2020.

So we have a lot to be thankful for at Golden Real Estate, most especially the patronage of buyers and sellers who chose us to serve their real estate needs.    I know for a fact that many of this year’s clients chose us not only because of the real estate reputation we have built through this weekly column but also because of the political stands I have taken regarding our former president and his followers. We gained far more clients than we lost because of my political writing.

And we are not alone politically. While fellow agents and brokerages have not spoken out as we have for fear of losing clients, the National Association of Realtors (NAR) has taken some courageous stands demonstrating alignment with our own values. For example, last fall the incoming president of NAR apologized for the past policies of the association which reinforced systemic racism, such as redlining and steering buyers to minority areas instead of showing them all listings they were financially qualified to buy. I’m grateful for the attention paid by NAR to social justice issues, but also for its effort, albeit unsuccessful so far, to eliminate the practice of off-MLS (“pocket”) listings.

I’m also grateful for the progress being made by REcolorado, Denver’s MLS. I have seen this progress from the inside as a member of the Rules & Regulations Committee as well as from being a user of REcolorado’s services. I appreciate REcolorado for adopting some of my suggestions, such as creating a field for closing notes.

At the top of my gratitude list is the fact that we were able to rent a storefront in downtown Golden. In early December, Golden Real Estate will be moving to 1214 Washington Avenue, the former location of Laurel Property Services. We look forward to benefiting from the pedestrian traffic of that prime location. We have ordered a WindoVision unit from TouchPoint Systems to capitalize on that traffic. Below is an artist’s rendering of it installed in our storefront. It allows passersby to search the MLS live using a through-the-window touch screen.

What’s really exciting about our move to downtown Golden is what it allows us to do with our current building on South Golden Road. As you know by now, we are a showplace of “net zero energy,” so I am partnering with broker associate Ty Scrable, who is super-committed and knowledgeable about sustainability, to create a new business we are calling The Net Zero Store. Our goal is to bring under one roof and into one showroom the various products and services that allow homeowners and businesses to “go net zero.”

Ty and I will be presenting our plans for this new venture at the Nov. 30th, 7pm, meeting of the Colorado Renewable Energy Society at the Jefferson Unitarian Church, 14350 W. 32nd AveHere’s a link if you’d like to attend.

Interviewing a Listing Agent? Ask Him or Her to Bring Their MLS Production Print-out  

The MLS printout for Golden Real Estate below shows the information that can be gleaned about individual agents and their brokerages. I’m showing our company report, but I could have shown my personal report. This print-out shows our production since Jan. 1st of this year.

The Production Section at top summarizes the report, showing that we had 46 listings since Jan. 1st, three of which we sold ourselves.  We had 21 buyer-side closings. The right-hand column shows the average of closed price (CP) to listing price (LP) — 102.47% for all MLS sold listings but much better for Golden Real Estate’s sold listings — 104.73%.

In the Production Detail section, the right-hand column shows how many days each sold listing was on the MLS before going under contract. Notice there are no zero days in MLS (“DIM”) because every listing was exposed to the full market so it would attract the most buyers, and yet there are few listings that took over a week to sell.

The “City” column lets you know where the agent (or company) does most of its business. The “List Price” and “Close Price” columns are also instructive. I’ve circled the two most recent sales as examples of how much above the listing price we sold those listings, thanks to our “auction style” of handling multiple offers, as opposed to the “highest and best” approach of most listing agents. It takes more work, but yields better results (a higher price) for our sellers.

This is not to suggest that an agent’s production is the sole criterion you should consider in choosing your listing agent.  However, we learn from experience, which comes from actual transactions, not from years in the business. An agent with only five years’ of licensure but who does a dozen-plus transactions a year can be more “experienced” than an agent who has done a couple transactions a year over a 20-year career.

And let’s not forget about testimonials. Ask for them, and look for online reviews, too. We like www.RatedAgent.com, because it only displays reviews solicited from actual clients following a closing, so the reviews can’t be phonied up or altered in any way.

Now That the Summer Months Are Behind Us, How’s the Market Shaping Up for Fall?

It has been a wild ride so far in 2021 — and the ride may be slowing, but it is definitely not over.

Below is a chart with some key statistics that I garnered from our MLS, REcolorado.com, for the 13 months ending August 2021, a timespan that allows us to compare this August with last August as well as the months since.

In creating the chart, I limited myself to listings within 15 miles of downtown Denver. That includes the entire metro area except for the city of Boulder.

The headings are pretty self-explanatory except for the last three columns. “Ratio” is the ratio of closed price to listing price at the time of sale, which might, in the case of older listings, be less than the original listing price. “Med. DOM” stands for median days that the listing was “active” on the MLS.  Half the listings went under contract in that number of days or less, and half of them went under contract in that number of days or more. “Ave. DOM” stands for average days that listings were active on the MLS, and it’s always higher than median days on the MLS because many listings are overpriced and linger on the market before the price is lowered and the home goes under contract.

There are some numbers that are worth noting, but there are some numbers that are downright remarkable.  We all know, for example, that the inventory of active listings is very low, but it’s notable that it is more than 40% lower this August than it was in August 2020. The number of sold listings is also lower by over 4% and the number of new listings is lower by 13%.

However, it’s also notable that the number of listings that expired without selling has plunged by over 43% from a year ago. More hard-to-sell and overpriced homes are selling before expiring.

Lastly, it is notable that the median days before a listing goes under contract has barely risen, and that figure has been under 7 days now for over a year.

Those statistics are notable, but there are two statistics that are remarkable. The first one is the ratio of sold price to listing price, which remains above 100% at 101.4%, although down from June’s high of 104.6%. This is remarkable because it was only this February that the number rose above 100% for the first time, signaling the height of the bidding wars. The August figure indicates that many bidding wars are still happening — due in part, of course, to the limited inventory of active listings — but they are not as numerous or extreme overall.

I emphasize “overall” because bidding wars are still getting extreme in isolated instances where the home is outstanding in some way or is in a highly desirable area with little or no competing listings. We are still seeing some homes sell for 40 to even 50% over their asking prices here and there. That includes in my home town of Golden.

So what, you may be asking, is the outlook for the fall and winter months?

If there is any seasonality left in the real estate business, it is that there are fewer new listings in the winter. You can see that was true last winter, with the low point being December. This makes sense, because few people want to put their home on the market during the holidays. That, however, only serves to keep the inventory of active listings even lower than during the summer time, yet the buying of homes continues year-round, with roughly as many closings happening in December as in November. Notice, in fact, that December was the only month in the last 13 where the number of sold listings exceeded both the number of active listings and new listings.

We should stop thinking of spring and summer as the selling season, but rather as the listing season. Most sellers believe it’s the selling season, when in fact homes sell year round. In fact, winter could be the best time to put your home on the market because there are just as many buyers getting those MLS alerts that I wrote about last week, but there are fewer homes for them to look at. 

If you want to sell your home before next spring, you should not wait until next spring to put it on the market — but do take some nice exterior photos of your home now that can be used in the marketing of your home over the winter.

Mortgage rates could start to ease upward in the coming months, but that will only increase the market frenzy as buyers try to get ahead of further increases in interest rates. No one in the industry, however, is projecting a major increase in interest rates over the next 12 months.

Email Alerts of New Listings Provide a Good Reason for Listing Your Home on the MLS

Yes, it’s a seller’s market, and maybe you think you don’t need to hire an agent to put your home on the MLS, but the opposite is true. Take, for example, the listing which was featured in this space last week. For 7 days it was listed as “Coming Soon” on our MLS, REcolorado, during which time it was not visible to non-mem-bers of the MLS (i.e., buyers). But that listing was emailed to over 250 buyers who had email alerts set up by their agents. One of those buyers tagged the listing as a “favorite” and another six tagged it as a “possibility.”

Those numbers, however, only reflect buyers who had included “coming soon” among the criteria that would trigger an alert. After the listing changed from “coming soon” to “active” on the MLS, the number of buyers who were alerted jumped to 720 and two more buyers tagged it as a “favorite.”  When a buyer tags a listing as either a “favorite” or a “possibility,” the buyer’s agent gets an email letting him or her know which client liked the listing and may want to see it when it’s “active” and showings are allowed.

These numbers don’t include the buyers who set up their own alerts on Zillow or other consumer-facing sites, including Redfin. Also, those websites don’t display “coming soon” listings until they have been changed to “active.” Thus, buyers who had agents include “coming soon” as a criterion benefited from a 1-week earlier notice of that listing than did any of those buyers who were setting up alerts on their own.

For buyers wanting the earliest alerts of new listings matching their search criteria, please make this a reason to have an agent set up alerts for you instead of setting up alerts on your own.

Knowing the power of MLS alerts should cause any seller to have second thoughts about selling without an agent. It used to be that sellers could hire a “limited service” agent who would put their home on the MLS for a flat fee (say, $300) without performing any other service, but that is now illegal. The Colorado Real Estate Commission has ruled that there are certain minimum services which must be performed by all listing agents. Those services include exercising “reasonable skill and care,” receiving and presenting all offers, disclosing any known material facts about the buyer (such as their ability to close), referring their client to legal and other specialists on topics about which the agent is not qualified, accounting for the receipt of earnest money, and keeping the seller fully informed throughout the transaction. 

Failure to perform those minimum services could subject the agent to discipline up to and including loss of license, which has caused “limited service” listings to disappear. If an agent offers such service to you, you should report them to the Division of Real Estate.

By the way, the Colorado Real Estate Commission has also ruled that it is the duty of all licensees to report known wrong-doing by other licensees, which their competitors are happy to do. We can be disciplined for not performing that duty.

Studies have shown that homes which are listed “for sale by owner” (FSBO) sell for less than ones which are listed by an agent on the MLS, and you can see why, because the more exposure your home has to prospective buyers, the more showings and offers you are likely to receive. And that difference in bottom line proceeds can far exceed the commission you are likely to pay.

Consider this: whether or not you hire a listing agent, you’re still likely to pay the “co-op” commission to the buyer’s agent, which is typically 2.8%. The  average listing commission (which includes that co-op commission) is now around 5.5%, not the 6% everyone tells you. As a result, the savings you might experience from not hiring a listing agent could be about 2.7%, and that is likely less than the increased selling price you might get from listing your home on the MLS with a true “full-service” agent such as my broker associates and myself.

Note: Some brokerages mislead you by promoting a 1% listing commission, but when they get into your home to sign you up, they disclose that the 1% is in addition to the 2.8% that they recommend as the  co-op commission and is increased further if they don’t earn a co-op commission on the purchase of your replacement home. It is also increased if they double-end the sale of your home, meaning that they don’t have to pay that 2.8% co-op commission to the buyer’s agent.

Such deceptive advertising, to me, is reason enough not to hire such a brokerage, but it may be hard for some people to say “no” to an agent they invited into their home with contract in hand.

Unlike such a brokerage, Golden Real Estate tells you upfront that we reduce our listing commission when we double-end the transaction, and we discount it further when you allow us to earn a commission on the purchase of your replacement home.

That said, our final commission might be only 1% or so higher than what you might pay to a discount brokerage, and our version of “full service” is much more complete than theirs.  For starters, we produce narrated videos tours on every listing. Our video tours are not just slideshows with music or un-narrated interactive tours which can be dizzying and annoying. Our narrated tours resemble an actual showing, where the listing agent is walking you through the house, talking all the time, pointing out this or that feature which may not be obvious otherwise. Are those quartz countertops? Are there slide-outs in those base cabinets?  Is that a wood-burning or gas fireplace? We have sold listings to out-of-towners who only “toured” the home on video, not seeing it in person until they flew into town for the inspection. That’s the power of narrated video tours.

Sellers Who Value Their Privacy & Security Can Make Their Home Visible Only to Agents

A recent email newsletter from our Denver MLS, REcolorado, to us members explained how sellers, through their listing agents, can literally sell their homes without their neighbors knowing about it — although your neighbors may ask why so many people are visiting your home, one after another!

To quote that newsletter article, “Whether they are a celebrity, in witness protection, or simply concerned for their safety, protecting the seller’s privacy is the primary concern.”

Although not mentioned in that article, it starts with the yard sign. There’s no requirement that you have a real estate sign in your front yard.

As you probably know, Realtor.com, Zillow, Trulia, Redfin, NextDoor and virtually every real estate website downloads its listings from the MLS, but your listing agent can opt out of such syndication, which also keeps it off REcolorado.com except for its logged-in members. However, the listing will still be emailed to buyers who have alerts set up by their agent.

There are lesser degrees of privacy available.  For example, a seller may be okay with displaying their home on public-facing websites, but only allow logged-in agents to see their address. That’s another option available to agents when they enter a listing on REcolorado.

Sellers also, of course, can dictate what interior pictures are shown of their home — or ask their agent to have no interior pictures at all.

As you probably know, it is recommended that sellers leave their home during showings and inspections, but I’ve had sellers who insisted on staying home during showings.

Recently, I had a husband and wife who insisted on being present for my open house. That’s okay, although unusual. The husband worked from home and insisted on keeping his home office locked to all visitors. We had a picture of his office on the MLS, and it was included in my video tour, but during showings a picture of the room’s interior was posted on the locked door to his office.

If you have video cameras installed inside and outside your home, that’s okay, too. To comply with privacy laws, you only need to post a warning sign visible to all visitors that video and audio surveillance is in use at this property. Adding that warning to the “broker remarks” on the MLS provides proof that you did notify all visitors, through their agent, of the video and audio monitoring present in your home. (The MLS system keeps a record of each and every change to the MLS listing, allowing you to prove that the warning was there from the beginning and not added later.)

If you don’t want your agent to install a lockbox containing the key to your home, that can be arranged. Just have the showing instructions say, “Seller will let you in and then step outside during the showing.”

Speaking of lockboxes, I recommend against the kind of lockboxes with dials, because anyone can look at the lockbox while it is open and see what the code is. That’s why we only use lockboxes with push buttons.

Electronic lockboxes are becoming more common in our market. The most common brand is SentriLock. Electronic lockboxes record the time when each agent enters and leaves the home, and showing agents can only use their access code for the approved date, not come back a second time without asking for a second showing.

Normally, we don’t tell the seller the code to the lockbox, because we don’t want the seller to give that code to a friend or cleaning person without our knowledge. However, I have on occasion given that code to a seller who wants to remove the key overnight.

I don’t want readers to get the impression that security is a big problem in our market. In two decades of listing homes, I have never had an incident where a visitor (including at open houses) stole something from one of my listings. Every licensed real estate agent has been fingerprinted and had a criminal background check done on them when they were licensed. They could lose their license and livelihood if they were later convicted of a felony. They would also put their license in jeopardy if they were to give a lockbox code to a buyer.

It should be noted that our showing service, ShowingTime, makes sure that no unlicensed person is able to get showing instructions for our listings. When an agent calls to set a showing using their own phone, ShowingTime knows from Caller ID which agent it is so they don’t have to check if they’re licensed. (They greet me by name when answering my calls.)

ShowingTime offers several options for allowing showings of your home. You can specify what hours you want to block showings, and these rule can vary by date or day of the week. 

You can also specify lead time for showing requests. One hour is a common lead time requirement, but some listings require prior day notice. In other words, your listing agent can pretty much set any rule you want regarding showings, and that rule is computer enforced, meaning the rules will not be violated due to human error.

Do you have other concerns?

Is the Real Estate Market Slowing, or Isn’t It? Here Are Some Useful Statistics.

Last week I did my regular update on the state of the bidding wars, but it left me unsatisfied because I knew that the market was slowing, yet the bidding wars seemed just as real, especially in the under-$500,000 price range.

The problem with my analysis was that I only looked at the homes which sold in 1 to 6 days because those are the listings which likely had bidding wars.

This week, I looked at the bigger picture but still limiting my analysis to residential listings on REcolorado that are within 15 miles of downtown Denver.

A chart containing some key statistics over the last 11 months is shown below. Here are my observations, which you can follow by looking at the chart’s columns from left to right.

First, it’s clear that the bidding wars started in earnest in February, when the ratio of closing price to listing price went above 100% for the first time. That ratio peaked in June and fell significantly in July, but is still far above 100%.

The number of active listings is still unseasonably low, but higher than it has been since last November. The number of listings under contract (pending) is lower than it was in May and June, but still higher than any of the other months on the chart.

The number of July closings is probably a bit higher than shown in the chart since I did this analysis on August 1st, and not all July closings had been reported, but it is clearly lower than June’s number, while higher than any other month since last October.

The number of new listings in July was higher than any other month except June, which reinforces what I’ve said for months, namely that the lack of inventory is not due to sellers keeping their homes off the market. Rather, homes sell so quickly that the number of active listings remains low.

The median days active in the MLS (DIM) has not risen, but the drop in average days in the MLS is very telling. The drop to 10 days is stunning and shows that even the homes that don’t sell immediately are selling faster than ever. Last July the number was 21 and in July 2019 the number was 23. In the past five years the average days in the MLS never fell below 16 until this April.

The last column shows that the inventory (in months) of homes for sale hasn’t been above one month since January, although it is the highest it has been since February.

The bottom line, then, is that, yes, the market is slowing but is still crazy hot. The trend, if there is one, is toward a gradual easing of the seller’s market in the Denver metro area, but it is well short of becoming a “balanced” market.

Will the end of the eviction moratorium have a big effect on the market?  My guess is that it may increase the number of new listings as landlords, especially small landlords, decide to sell rather than replace their evicted tenants. The opportunity to cash in on their properties’ increased value may be too much for some to resist, and the risk of continued lost income too great for some landlords.

There will not, I believe, be an increase in foreclosures or short sales, because very few property owners are likely to owe more than their property is worth. Because of that, they will simply sell.