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Spring Market Overview

[0:00] I have the most fascinating statistic to show you this month in May for our Denver market and it's going to blow you away. It kind of blew me away. But here we are in spring full season for the housing market here in Denver. It's the most active we are at any time of year, but tariffs are still being thrown out there. Uh interest rates are still high. So what's going on with your home value? And if you're looking in the Denver market, what in the world's going on? Is it a good time to buy? Is it a good time to sell? But we're going to break it all down and we're going to start with what we always start with, which is what's going on with supply and demand because that is the driving factor on prices.

Supply and Demand Analysis

[0:33] There's a lot of crazy headlines out there. Um, so let's just get right into it. And if you don't know who I am, my name is Alex Sana. I've been a local Denver agent since 2010, helping hundreds of buyers, sellers move, relocate across the Denver metro area. If you ever need anything, just feel free to reach out and I'll help you navigate what is maybe the weirdest market we've been in since the 70s or 80s. So this is the entire Denver metro area. The stat I'm going to show you, which you got to hang around for, uh, is going to pull from a smaller part of the Denver metro area, but it is wild. So, the new listings, right, in the, you know, form that this has put out to you as in the last 5 years, it's just kind of a heartbeat, right? We have less new listings in the winter, more new listings in the spring. Totally makes sense. What is a little odd, so usually the peak, last year was in May, year before was in June, year before was in June, year before was in June. We're seeing a trend, right? If I zoom this out to 15 years, we're here and we're already matching some of the highest peak times for new listings that we've had in the last 15 years. In the next two months, May and June will generally be higher. So, we might have a breakout of new listings coming to the market.

[1:41] And if we do, I'll keep you posted. Okay. Now, how is that translating to active listings? So, how much is getting absorbed into the market? Currently, we're about 21,000 for the entire Denver metro area, right? We're talking about Boulder all the way down to Castle Rock. Um, and everywhere in between. Last year, we had 12,400 units on the on the market. Now, we have 21,000. That's a 46% increase. It's a fairly good size increase. Okay. Last year, our peak active was in September. Okay. So inventory is building building building building until the late summer early fall months. And if we zoom this out to a 15-year time frame, we can see we've got these COVID years. They're crazy.

Inventory Trends

[2:28] Get rid of them completely cuz they were kind of bogus. But before that, we can see this trend of having maybe 15,000 units for sale, 16,000 units for sale. And then we match that in 2023, look normal. 2024 up to 21,000. So, and that peaked out in September. 2023 peaked out in September. Uh 2022 peaked out in September. There's a trend here. So, what's going to happen? We're going to keep growing in inventory until September. What that inventory number gets to is the real question. Uh based on this, if we want to try to put a percentage on it, which is near impossible, in April last year, we had 14,000 units. We went up to 21,000 units. So that's about a 50% increase from April until September. Well, if we do the same thing, that puts us north of 30,000 units. Okay. If we get into that territory, it's going to be a seller.

[3:21] It's going to be a buyer market, excuse me. Um, so it's just something to watch for, but a lot of sellers are stunted right now uh because they're not getting 50 grand over asking price. You have to price it competitively competitively. You have to negotiate with buyers. It's a pain in the butt. And so there's a lot of people who aren't going to be selling this summer. Uh, so maybe we see a little decrease here. A lot of buyers and sellers have been scared from the beginning of the year with all the tariffs talk. So maybe we see a more balanced summer, but I'll get on to my predictions in a little bit here. Now, on pending listings, how many are going under contract? Well, you can see in December we had 3,900 under contract. We went all the way up to 7,300. Then we ticked down a little bit in April. So more is coming on than is going under contract. And as far as closed listings, we spiked up pretty healthily in April, up to 6600 closed listings, which is up 5% year-over-year. Okay. Days in MLS. I like to look at the average here. And this is this is the reality is that the expectation right now is you're probably going to be on the market for 6 to 8 weeks depending on how aggressively you price it. Now, that's down from 67 days in January, but we can see last year around this time we were at 35, right?

Days on Market Metrics

[4:39] So, it's a 15% increase. This still isn't bad. Like, having your house on the market for 6 weeks is no big deal. But again, the trend continues in that with more inventory, there's more competition. Buyers can be pickier, and so it's going to take you a little bit longer to be on the market. month supply of inventory. This is the number on what is a balanced market on the buyer side, the seller side or is it an extreme buyers or sellers market?

[5:06] Four to 6 months is considered a balanced market. Okay? And that means, you know, buyers have an opportunity. They can actually shop. They can actually sleep on something overnight, not make a decision on it. Um, when it's more than six months, it's a pretty extreme buyer market. um where you could take advantage of things and prices are dropping heavily. We're at 3.6 months right now. So, we're not quite in the balance zone. Still considered a sellers market. Doesn't always feel like that.

[5:34] Uh you know, at the time of recording this, but last year we peaked at about 3.8 in September. So, where does this get to? This actually might get into four months of inventory, which the last time we were there was 2012. 13 years ago was the last time we were in an official balanced market. I keep using the bunny ears, but the reason why I do that is because um I don't know if I buy into it. I think where we're at now is actually more of a balanced market just based on how many closings are happening. I think 3 to four months is more of a balanced market. I think more than four months starts to get more into the buyer's advantage.

[6:15] Okay. All right. Percentage of closed price to list price. Uh 100% doesn't give us any data. I hate this number as you guys know. Um doesn't really give us the feedback we need. Every neighborhood is different. Uh every year properties built are different. Every price point is different. All right. Showings. What kind of showing activity are you going to get if you put your house on the market? We're going to look at the averages here.

[6:40] In December of 2024, we were getting 17 showings before going under contract. That's a lot of showings. Now, we're down to about 12.6, right? People are out now are a little bit more serious uh of buyers, but it's still 12 and a half showings on average to get a contract for your property and go under contract. And then the showings per listing per month is down to around 5.3. So, if it takes you 12 showings to get under contract and there's five showings a month, going to take a little over two months, okay, to go under contract on average with using these numbers. Uh, but one of my favorite quotes, Mark Twain, figures can't lie, but liars can figure. These are just statistics. If you price appropriately, appropriately based on the current competition on the market, you will go under contract quickly. If you price based purely on what has sold over the last 6 to 12 months, you might have an uphill battle, right? And here's why is we can do a good job in figuring out what your home could appraise for. Okay? I was trained by appraiser many years ago. Um I'm pretty confident that when I have a price on a home and you set the price as a home seller. I don't. I'm not one of those realtors. It's your house. It's your decisions. I can make a decision on whether or not we're going to work together. And if that falls within my line, sure, I'd love to help you get there. Um, but I'm not going to tell you something, you know, is worth 800,000 when it's worth 700, um, just to get you to sign. But that happens out there in this industry a lot. Um, likewise, if you want to list your house at 800 and it's really worth 700, we're probably not a good fit to work together, right?

Pricing Strategy Guide

[8:18] Because I know it's going to be an uphill battle. Um, but if we're in a, you know, range of reality, uh, it's your decision to price that home. And what we do is we looked at closed prices, right? in the last six to 12 months. And that makes perfect sense on how to figure out what your house might be worth. But then if you're not also looking at what your neighbor listed for, maybe we think it's worth 650 all day long, right? And we have numbers to back it up if we get the offer and it will appraise there. Well, what happens if your neighbor goes up at 625? Which one's going to sell first? If it's the same house, the one at 625, right? What if the one around the corner doesn't happen to be on a culde-sac? Prices at 600,000. Right? those are going to sell before you are. And then if you just want to wait it out to get your price, well, what if other neighbors keep putting their houses on the market at more attractive prices? So, you can look at closed properties as a good idea of what it's going to sell for, but right now in our current market, active properties and ones going under contract are the ones driving our prices. Some neighborhoods are down, some neighborhoods are up. Uh very micro markets here in the Denver area. Uh, and again, if you want help navigating, you know, what you're looking at, uh, just reach out, let me know. I'd be happy to walk you through it. Now, getting back here to what everybody wants to know, close price. I was a little surprised at this.

[9:42] Okay, this is not the shocking stat, by the way. I'm going to show you that in a minute. Um, this is our close price. We were up one and a half% month over month. March, we were at 570 median close price. In April, we were 578 basically. So, we're getting close to breaking out to the 2022 pricing. We'll see what happens over the next month. Now, this has been our range over the last 3 years. This is this is what's got a lot of people frustrated is that in 2022, we had this huge spike all the way up to 590,000 for the median home price.

Price Trends by Month

[10:15] And we can break this down by different cities. I'll go look at just Denver proper, okay? And we were all the way up to 630. We went from 516 in January to 550 in February to 590 in March to 630 in April. Oh my gosh. 4 months we went from 516 to 630. $100,000 20% in four months. That was bonkers. And then we boom instantly dropped down. So if we got rid of this spike, right? What would this look like? If we just got rid of this stupid spike, we'd actually see a slow trend up in Denver. In all of Denver, if we got rid of this spike, we'd actually see a slow trend up, too.

[11:01] But in the last 3 years, it feels like we're flat. Okay, we're in this range and we don't know which direction we're going to go. Are we going to go down? Are we going to go up? And I think a lot of it has to do with what the government's doing. Okay. Um, don't have a crystal ball. Uh but if I had to guess, you know, we're going to we're going to be balanced here for a little bit. Um so that's what the close price is doing. The close price ticked up well. Has not broken last year. Our peak was 580 in June. So as long as we can get another $2,000 out of this May, we'll be set, you know, to to compete with 2022 pricing. But it may not feel like that. And here is why. First of all, interest rates suck, right? Uh, we all got spoiled with 2% 3% interest rates and now we're climbing up to 6.8, right? We thought we were going to have relief over the last two years, this chart, right? We peaked out at 7.8. Woo doggy. And now we're at 6.8. And it's just painful. It's cheaper to rent than it is to buy in Denver for the most part. Um, you know, there's a lot of advantages, of course, to coming with owning that don't come with renting, but especially for first-time home buyer homes right now. Um, if you can buy something at 350,000 with an HOA, two-bedroom, two bath condo, uh, you might be paying close to $3,000 a month.

[12:20] Well, when you rent that place, it might cost you two grand a month, right? So, that's been a challenge in the first-time home buyer market out there. But the crazy stat that I just saw the other day, yesterday in fact, was this. the active housing inventory for sale by April in the top 50 largest metro area housing markets from preandemic levels. Okay, Denver. I did not expect to see this. Denver, Aurora, Centennial, so kind of taking the three big cities in the metro area. In April of 2018, we had 4,800 for sale. Then we had 6,500. Then we had 4,900. We had 22, 23, 4, 6,200. We're over 10,000 now.

National Market Comparison

[13:10] Compared to that time, we were up nearly 60% in active inventory from preandemic levels, right? And you can go through this and and all the usual suspects, right? The people who uh had home values just go through the roof. Austin, Texas, Memphis, Tennessee, Orlando, Florida, San Antonio, Tampa, like San Francisco, Dallas, um Jacksonville, like all these areas that we heard about like, oh, prices are going bonkers. I just didn't think we'd have the most amount of active active inventory from then until now. And then on the other side of the spectrum, my gosh, my old hometown, right? I'm I'm going to get rid of Hartford, Connecticut. I mean, they've only got 961 units on the market. Providence, Rhode Island, you know, a little bit more, 1,600 units. Chicago, Neapville, and Elgen used to have 31,000 units for sale pre- pandemic, and now they got 12,900. I mean, that's down 62%. What in the world is going on in Chicago? Like, people are moving back there this much that the active inventory is that down? Um, New York, same story, from 56,000 active down to 31,000 active. Like I don't know those markets nearly as well as I know Denver, but that is just kind of a crazy statistic at how much less inventory there is on the market there than there is at other places. Like so just interesting stats like this that I see that you know just kind of blow me away and I love to fill you in on what's going on. All right, crystal ball time, right? It's May 2025. What do we see?

Future Forecast Predictions

[14:45] Where do we go? Well, I think we're purely in an inventory uh situation here. We are not in a people are in trouble situation here. I can tell you that. I was just looking at loan to value numbers across the entire US this morning and no one's only.3% of all homes in the US are underwater. Okay, that's nothing. Uh that was like 20% back in 2008. Loan to value on properties is low low. It's all what all the bears out there want to talk about is how we're about to crash. we're about to tip and crash and burn and blah blah blah. But there's just not enough loans out there to squeeze people to being underwater. So even if someone loses their job, you still have $150,000 worth of equity in your house to be able to sell it. So you can still put it on the market, accept a reasonable offer, and get off of it without having to go into foreclosure. And that's a story across the entire US despite what anybody says about this shadow inventory out there and how there's a million new foreclosures to come on the market, blah blah blah. We've been hearing that stuff since 2015. No one knows exactly what's going to happen. Everybody who's shouting from the rooftops that we're going to crash, they do that consistently every single day of their lives and they're called perma bears, right? And every 10 years they're right.

[16:01] And then they tout how right they are. But we don't often talk about how wrong they are the other nine times, right? We'll take Michael Bur for example, the most famous bear in the world who called the 2008 crash. It was very wrong for a long time and almost went out of business and how long he he held his short position in the market. Nearly crushed him, right? Nearly lost billions of dollars. And then he was right.

[16:25] Right. And there were markers out there and he read them. He called it right. But he'd been wrong ever since. Like so he's been calling for crashes and for years now again and it just hasn't happened. So, we we give credit maybe where it's not due all the time, right? It's like being the goalie in hockey, right? You get all the credit when uh you lose and you don't get any credit when you win, right? That's just how it goes. Um it's a crappy position to be in. Um but it's arguably one of the most important. Um so, just just do what's right for you, right? Um, I think we are going to see a 7 to 10% decline in pricing houses from the next 30 to 60 days until the end of the year. That's pretty normal in Denver. Uh, maybe a little bit more aggressive than normal.

[17:15] Normal is maybe 5 to 7%. We might be in that 7 to 10% range. Like that just might be the reality, but that's on the median number. Um, which is just what it is. It's a median number. Um, but I think that's what we're going to see overall. Uh, nationwide. I think we're going to have some strong cities. I think we're going to have some weak cities and I think these interest rates are hurting. But I think that pulls in for an opportunity because if interest rates were to drop a full point tomorrow, a point and a half, we'd be on like gang busters again. All the inventory in Denver would be gone in a month, right? Uh that's how much pent up demand there is on the back end. And that's what does excite me for the next upswing is that there's so many people have outgrown their house. There's so many people who want to move. There are so many people who want to buy but feel trapped because interest rates are just bad right now. Like I know cyclally and historically, you know, 7% is about the average. But dude, when you're buying a $600,000 house and you're putting down 20% and you're going to be paying, you know, north of three grand a month for that mortgage, like that's painful. I don't care who you are, that's painful, right? Um, and so until that alleviates a little bit, like I think we're going to be in this limbo. But if prices did, you know, or interest rates did come down that much in a short period of time, there's just too much pent-up demand, right? There's all the move up buyers who have been stuck for years.

[18:40] There's all the downsizing buyers, right? Our parents generation that have been stuck for years. Uh there's people who want to move across country that just feel stuck because they've got a $1,500 a month mortgage and they don't want to pay $35, $3500 a month for what they actually want. Um and so I think we would see all of that move up and shake up rather rapidly. In the meantime, do what's right for you and your family. Uh protect yourself, you know, hold on your pocketbook a little bit tighter like most of us are doing until we kind of get into the clear. But I do think this next upswing is going to be great. But I don't think we're going to see any 30% plus downturn. I just don't just don't see where it's going to come from. I'm wrong all the time. So, it's very possible, but that's just my take and I don't see where it's, you know, going to come from. But, if you are looking for a deal out there, um, and you've been toying with buying a foreclosure because it got really popular last time we had any sort of market correction, you need to watch this video because I'm an expert in foreclosures and how they happen. And there's just some realities that everyone's not telling you out there. So, enjoy that video. And again, if you have any questions, feel free reach out, call, text me.