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2025 Denver Market Overview

[0:00] 2025 was one of Denver's most misunderstood years in real estate that we've ever had. I've been in the market for over 15 years and I've never seen headlines quite out there like this. And let's be real, like this stuff exists because it gets clicks on. I read it so I can kind of describe what's going on to my clients and the people in my life. But Denver's housing market is hit with an explosion of listings. How far could prices fall? Denver's housing market hit by unprecedented spike in homes for sale. you know, the most splendid housing bubbles in America, April 2025, of course, we make the list. And anytime you do a search for Denver real estate, you know, all these headlines come out, Reddit forums, you name it, and it does seem kind of wild and it's a little bit scary, but what's actually going on in the Denver market and what happened in 2025? It is the very beginning of 2026.

[0:52] And that's what we're going to break down in today's video. What actually happened versus the headlines and then of course where I think we might be heading in the next year, in the next 3 to 5 years. My name is Alex Alvani. I've been a local Denver agent since 2010. Uh, and I talk about real estate all day every day. So, if you want to talk about it, just feel free to give me a call. Um, shoot me a text message or you can scan this QR code, get on my weekly email list. So, let's break down the numbers on what actually happened. New listings, right? is a supply and demand market. Uh this is what drives all of the pricing. And we can see here new listings to hit the market in December of 2025 was down by 4%. Year-over-year.

New Listings & Inventory Data

[1:36] So less people listing their house in December than a year ago. Okay, that's going to mean there's going to be less supply, which means if demand stays the same, prices should start to go up. Okay, so active listings is the big one, right? So, even though less people are putting their house on the market, if a bunch of houses are sitting on the market, prices are going to go down. Well, what's interesting is we are up about 4% year-over-year in active listings, about 15,500, but this is down from 27,000 in July. That is a huge dip in active listings. Now, big piece of that is from people withdrawing their houses off the market or expiring them off the market. they didn't get what they wanted as their, you know, asking price. Uh, and so they decided to take it off. Now, we're going to cover this here in a few minutes because this is a huge part of why the 2025 market just felt so funky. Um, and it just has to do simply with so many people have so much equity. We're not in the same scenario we were where we were in 2008 and '09, uh, where, you know, we were seeing foreclosures at the wazoo. But I'll tackle that after we kind of go over all the numbers here. Uh, stick with me.

[2:45] Now, pending listings, how many are going under contract? Down one and a half% year-over-year. Nothing to write home about. Pretty much flat, right? Closed listings actually went up month over month, but still down 1.7% year-over-year. But you're talking the difference by like a couple hundred, right? 5200 versus 5100. 100 less went under contract or closed in December than it did last year. No notable difference there. Okay. days in MLS is definitely up, right? 14% uh year-over-year for the median average up 16%. So, it's taken over 70 days of your house being on the market, over 2 months for your property on average to go under contract, which does feel like an eternity considering what's been going on the last, you know, 10 15 years in our market. Uh month supply is a big number and that's up 3.8% year-over-year. Again, these are very nominal differences. um 2.7 months of inventory is still considered low. That four to six months is considered a balanced market. We'll also talk about that a little bit more because we did go well into the balanced market uh this year which we were at 4.6 months and there's a difference here. So, I'm going to break this down a little bit. So, there's old rules of thumb, right? 4 to 6 months of inventory is a balanced market. That's where buyers can actually compete a little bit. Sellers are still getting a great price. It's just kind of even. North of six months is an extreme buyer market. South of four months is an extreme sellers market. But I think that's different than it would have been 20 years ago. And here's why. Uh because people are staying in their homes for many many years longer than they used to. 20 years ago, every about uh 5 to 7 years, most people would upgrade their homes. They do a move up purchase, downsizing, stuff like that. Right?

Days on Market Analysis

[4:37] every 5 to 7 years people were moving essentially which seems crazy now where today people are staying in their homes upwards of 12 to 13 years on average it's almost doubled in the last 20 to 30 years. So is the old rule of thumb 4 to 6 months of balance of inventory a balanced number? It actually feels like 2 to 3 months is actually a balanced uh market, which if you kind of adjusted the numbers would kind of make sense.

Market Balance & Showings

[5:07] So, anything under two would be more of an extreme sellers market. Anything over three would be more of an extreme buyer market. And that's kind of it's kind of how it feels right now. If you've been on the buy side, you know stuff is sitting longer. If you're on the sell side, you know, it's getting more painful because your house is sitting longer and you just have to negotiate with low ball offers, right? It's just kind of the nature of things. So, I think this number is something to pay attention to uh as we go into 2026. Now, moving along here, how many showings uh to go pending? You know, we're looking at about 13 right now in December.

[5:42] Pretty much even year-over-year. Um, and then the amount of showings per listing is down sort of about under four showings per listing for the month of December year-over-year. Um, and we can see obviously the CO years were much much higher and we've just kind of settled into this little trend here. And then the big number, the closed price, we are down as far as the Denver metro area, which includes everywhere, Golden, Arvana, Centennial, Parker, Aurora, uh, we're down 1.8% yearover-year from a year ago. Now, there [clears throat] is a tale of many, many markets. Okay? As we break down this number, you can look at single family homes, you can look at condos, you can look at town homes, you can look at the million-doll plus market, you can look at firsttime purchases under 500,000, and they're each going to tell a little bit of a different story. So, the way that I look at this and determine, okay, are we in trouble? Where are we heading? Where do I think, you know, we have the potential uh for opportunity in 2026? Cuz there's always opportunity on one side of the transaction or another. It's very rarely balanced on both sides, right? It's usually better for sellers or better for buyers. So, I look at this and go, okay, we're down 1.8%. How many dollars is that? Right? So, compared to last year, we closed at 555,000 [snorts] in December of 2024.

[7:08] 545,000. So, we're down 10,000 yearover-year. Not a hugely significant number in my opinion considering the last 3 years we've pretty much been in a range from 570 down to 530, 580, down to 550, 580, down to 545. Right? We're just kind of in this range. And so when I open up this chart, we can see like this is like looking at a stock, right? If you own Tesla, if you own Apple, Apple, Amazon, um you're going to see it looks very very similar, right? We get these peaks and we get these valleys year after year after year. And on average, we are trending up. What is the anomaly is this April of 2022. Okay, that was the very peak of the market. It lasted about two weeks and then it felt like the the rug was just pulled out from all the sellers. Now, if we get rid of that intense spike, we've just kind of flattened off a little bit here, okay?

Price Trends & Neighborhoods

[8:06] We're just kind of sticking within this range of home prices. Uh we haven't broken out one way or another to the upside or to the downside. So, I would say honestly this down 1.8% 8% number, which the headlines will read, Denver metro is down 2% year-over-year. Uh, which sounds like a much bigger number considering a good market is up 6% year-over-year. Um, and so you're going to see those headlines out there, but next month depending on what closes, you know, we could be up 3% year-over-year.

[8:36] It changes month by month. We're just flat over the last 3 years since 2022 through 2025. We're just kind of flat. And every single neighborhood is different. So, we can come in here and I can look up Denver Proper and we can actually see Denver Proper is down 3% year-over-year. That's actually going to be the headline. Okay. Um, you know, we peaked out this year around 610 in June and we're down to 535. Like, that's a pretty significant $85,000 difference between the peak months and the winter months.

[9:09] Uh, so it's just something to pay attention to if you're on the sell side, if you're on the buy side. um you know, but that purely has to do with supply and demand. And so, let's go look at another city here. Let's go look at Centennial. They're showing down 6% year-over-year, down to 600,000 from the peak at $700,000. That's a $100,000 difference from July to December. Uh they actually peaked up quite a bit this year in July. They broke their highs from back in 2022. Um let's go look at another one here. Let's go look at Aurora. And we can see they're down 1.7%.

[9:46] Let's take a peek at Parker, they're up [snorts] 2.6%. Uh Lakewood, they're down 5.2%. Littleton, they're up.1%. Okay. And then we [snorts] could break down something like, let's say, condos, right? Condos have been getting a ton of attention in the media lately because we've had a massive explosion in listings in the Denver condo market. But then we look at the median close price year-over-year are up 8.3%.

Condo Market Performance

[10:16] Up to 325 where last year we closed at 300 at the year end. So this would make for an incredible headline, right? Denver condos up 8% year-over-year. They break the trend. They're breaking the mold of all the other inventory that's on the Denver market. And Denver condos are up 8.3%. Does it feel like that? Heck no. There is a ton of opportunity in the condo market right now. That's why it's super important to have that feedback from boots on the ground that actually understand the market that work with a lot of sellers that work with a lot of buyers because what these numbers say is very different than what's happening out there in reality. For all the buyers that I've helped this year, the 20 some odd buyers uh that I worked with this year, um all but maybe two or three uh got their price significantly under asking price. We're talking anywhere from five up to 25% below the ask price. All negotiating with, you know, seller concessions or inspection items uh throughout every single transactions. The sellers that I've worked with this year, um several of them did get their asking price. The other 10, 15 of them, uh you know, they had to kind of let the market teach them what was going on with inventory out there and what buyers were doing. and you've been on the market for two or three months and then finally you get an offer in and you realize you have to play ball because it might be another two or three months before you get another offer in and you might have to do another $25,000 reduction, $50,000 reduction because there is competition out there right now in your neighborhood. If you're a buyer and there's eight other properties that actually would work for what you want, uh, you know, you're going to shop around and one of those people will kind of rise to the surface as being more of a motivated seller and you might want to attack as a buyer. That's just the reality. So, where do I think we go from here? Well, I think 2026 is again a tale of mortgage rates. Right now, we're sitting at about 6.15% on a conforming loan. I do think we're going to get into the fives. I think we're going to continue to have some downward pressure on mortgage rates, which will help on the sell side of things, but the bigger picture here is I think we're just going to hang out in this flatish zone. And I think we might have another year or two of this honestly before wages catch up a little bit more or some other big event happens that forces interest rates to go down which will then probably have a turmoil point in real estate for a handful of months or even a year before prices then continue to go up. You know, people always ask me, "Well, God, how much worse can it get? Like things are already way too expensive." Well, go to San Francisco where a 3000 ft² 4bedroom 3 bath house built in the '90s costs over $2 million. Where here you can get that same exact thing in Parker for 600 700,000. Right. We are an extremely desirable city to live in. Our lifestyle is topnotch compared to most places in the country. Our weather here is incredible. The outdoor lifestyle, I mean, just look behind me. I mean, one of the most beautiful places in the world. And this is in our backyard here in Denver. And you know, so we are always going to have people get attracted here from other parts of the country. Logistically wise, if you're a big company, shipping from here makes more sense than it does from the east coast to the west coast cuz we're in the middle of the country. We control a good chunk of the West Coast's water supply.

Price Negotiations & Inventory

2026 Outlook & Market Stability

[13:46] You know, we have all four seasons. We check a lot of boxes for a lot of people. And so we will always have this draw here. Incredible schools. uh just to again get incredible lifestyle all around. And so where I think the opportunity lies is still going to be in the buy side for a bit, right? That firsttime home buyer price range sub 500,000 prices are getting beat up pretty heftily right now. Why? Because it is actually cheaper to rent than it is to buy in sub500 unless you're putting down well north of 20%. And most people buying a $400,000 place don't have 80 to $100,000 to put down. They just don't. they're putting down 3 to 5%. Uh, and so when you have to make the decision on a three-bedroom place costing $2,200 a month to rent, $2,400 a month to rent, but only having 5% to put down, which would then make your monthly mortgage north of three grand a month to rent, right? That's a really tough decision. So, I do think there is opportunity in that if you can suck up the higher payments for, you know, the next year or two until the market kind of rebounds and goes on the way up. If indeed that's what happens on the sell side, I think you're still going to be facing some headwinds here, right? There are a lot of people who want to sell, but part of this entire picture of what makes this market so goofy is that you see days on market increasing. You see more houses for sale in your neighborhood that are not selling. But at the same time, if you watch a lot of these houses, you're going to see houses that have been on the market for four or five months don't have a single price drop. Why? Because the seller's not actually in trouble. Okay? Back in 2008, uh people were massively in trouble.

[15:29] There were a ton of short sales that came on the market. There were a ton of properties that went into foreclosures, became bank-owned properties, then the bank was selling them off. And you know, to date in Denver, there's just nothing. I mean, I think there's a handful of short sales in the entire Denver metro market where back in 2008, man, there were 2, three, 4,000 bankowned foreclosures on the market in any given time. That's not even a thing here.

[15:54] There's a couple of dozen right now. So, what this means is that sellers aren't in trouble. They still have a lot of equity and they can sell when they have to if they do fall behind on payments and, you know, are facing foreclosure. And that foreclosure process, most people don't know, takes anywhere from 12 to 36 months on average. It can be done a lot quicker. But most banks, they really don't want to own your home because they are going to be losing money. So, you get behind on your payments and then, you know, the time comes where you're finally like, my only option is to sell the place. You still might have 200 grand in equity, 300 grand in equity, uh, because you bought it more than 6, seven, eight years ago.

[16:32] And so, we're just not in that same financial situation where people are in trouble. lenders since 2008 have had much more stringent uh uh lending guidelines. And so the majority of houses have, you know, north of 10% as a down payment, which then makes it a less risky market. Uh and people can just hold on through market adjustments like what is happening now. So you're seeing a massive amount of properties coming off the market, being withdrawn, being expired, and then turned into rentals because you can still get a good rental rate, right? or being handed off to family members to live in. And so you just don't have the same effect that we had back in 2008. Now again, I talk about this stuff all day every day. And I know it could be a really confusing market. So just feel free, like I said, call me, text me, whatever questions you have. I love talking about this market because it can be rather tricky to navigate or just get on my weekly email here uh by scanning this QR code. Now, if you are thinking of moving to Denver, there might be a few places that you kind of heard about and you might want to avoid, which is why I put together this video on some of the top places that you should kind of steer clear from in the Denver [ __ ] it.