November 2023 Market Report
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With the holidays upon us, we are focusing on the gift of homeownership this season, says the Denver Metro Association of Realtors’ Market Trends Committee.
Owning a home provides stability and security for many families. It is also the single largest investment most people make in their lifetime, which serves as the single best vehicle to attain individual and generational wealth.
For buyers, the gift this season is growing inventory. Active listings at month's end increased 6.89 percent year-over-year to 6,684, new listings rose slightly by 1.04 percent to 2,717 and closed sales dropped 13.98 percent. During this time of year, I prefer to look at the month-over-month data as this holds more weight. If we look at the month-over-month data, active listings dropped 10.67 percent and new listings dropped 28.93 percent. However, that doesn't paint a true picture of our market as the Denver Metro Area is seasonally based, which means that we typically see a decline in inventory this time of year. As such, the increase in homes for sale provides the gift of choice.
Speaking of gifts, this is my absolute favorite time for buyers to get out and shop for homes. Sellers whose properties are on the market typically need to sell and are more willing to negotiate than in March or April when the market is at its peak. Additionally, the competition from other buyers drops considerably. As such, buyers who can see the beauty of buying a home right now have their choice of home and can negotiate their way into their dream home.
The opportunity for buyers continues as we look at the close-price-to-list-price ratio-which can be a bit deceiving. This number continues to hold strong at 98.56 percent; however, we do not track concessions in this report. What we know in the in-dustry, but don't publish here, is that sellers are currently negotiating significant amounts towards lender buy-downs to help buyers ride the wave of high interest rates while keeping the sales price fairly static. I received a marketing piece recently showcasing that a seller of a higher-priced property was willing to offer $100,000 in incentives.
Sellers aren't left in the cold this season as they have some gifts coming their way as well. They have time to prepare their homes and mindset for the marketplace as homes are taking longer to sell. The median days in the MLS has grown to 22 days, which is up an astounding 37.50 percent month-over-month. While December is typically overrun by the holidays, this is actually a great time to get some of the deferred maintenance items completed while vendors are slower. They can also set a new frame of reference for life once their home hits the market. If your home sells in one week, great. But if it takes three months, that's okay, because it's normal activity and can help alleviate concern.
Additionally, interest rates are starting a downward trend, and we as Realtors® know that if rates continue to drop then demand will increase. In fact, many agents saw a flurry of activity last month when rates dropped buoying end-of-year activity. Depending on where rates trend, we may see bidding wars back before we know it.
The gift I'm most excited about is the ability to slow down and find balance. The shifting market this year has thrown all of us off kilter but the 2023 data aligns similarly in many ways with the pre-pandemic real estate landscape of 2019. The market is finally finding a sense of equilibrium after three years of record-breaking stats. While we don't know what the New Year has in store for us, it's helpful to take a moment and appreciate the gifts available in our marketplace.
