DENVER (CBS4) – The housing market remains one of the toughest in the history of the Denver metro area for buyers. New data released in October shows low inventory of homes for sale while the median price increased for detached homes to $510,000. The number of listings is down compared to the previous month and is less than half what it was this time last year.
“It is incredibly difficult for buyers today, they’re just having to work like crazy,” said Jill Schafer of Kentwood Real Estate. “People are having to put all their cards on the table.”
Schafer is on the market trends committee for the Denver Metro Association of REALTORS, which puts out the monthly real estate report. She says one of the biggest challenges is that the low inventory and increasing prices are pushing some people out, they’re unable to afford any homes in Denver and its immediate suburbs.
“Some people are being priced out of the market, and we’ll see some of the buyers who are having to push their budget higher in order to continue to try and compete,” she told CBS4 on Wednesday. “I have a lot of people who will say what if I move up in price, will I find more choices, and the answer is no. There’s just not choices out there.”
Buyers who want to shop above the median price still face low inventory for homes reaching $2 million, according to Schafer. She says only when you get to homes listed at $3.5 million or above do you find enough inventory.
“Buyers are getting frustrated and they are having to be really patient and persevere through it I guess, in order to get a house,” she said. “We have no choices for them, there are so few options and there are so many more buyers than there are homes to sell that they’re all competing for the same ones.”
New construction is helping the overall market in the state but its focused outside of Denver, farther away from the city center on the north and south ends of the I-25 corridor. So it cannot address this shortage and it often forces buyers to wait until their homes are complete. Another challenge is the limited movement among families, most choose to buy and sell in the same county. So even sellers are up against the same issues when they look for their next home.
“They’re ready to sell but I think there’s hesitancy because they don’t know where they’re going to go,” Schafer said.
If interest rates remain low, it will keep the market competitive as it lacks available homes in the Denver metro area. This suggests the same climate for buyers and sellers for the rest of the year and into 2021. But the upcoming election remains an unknown factor which Schafer says everyone should watch closely.
“I tell my buyers that they’re going to be having to put everything on the table right from the get-go,” she said.