The Denver Metro Association of Realtors …
released news this week that put a new perspective on the home-buying experience in the Mile High City. If you want to buy a home in the metro area, the average price of a single family home just surpassed the $500,000 mark for the first time on record.
“The prices are being driven by the lack of inventory so you know we have more buyers in the market then we have houses,” said Athena Wilson-Flierl, long-time broker with The Peak Properties Group.
DMAR along with The Voice of Real Estate ® in the Denver metro area, released its March Denver Metro Real Estate Market Trends Report Monday. While it could be disheartening to buyers, it does show an uptick in inventory.
According to the report, active listings for the residential market finished 5.56 percent higher than last month and 5.31 percent higher year over year.
“This is good news as we normally see a small seasonal decrease this time of year,” said Steve Danyliw, Chairman of the DMAR Market Trends Committee and Denver REALTOR ®.
The report goes on to say that the metro-Denver housing market saw an additional 4,638 new listings in February, an increase of 10.88 percent from January. Despite the uptick in inventory, buyers and brokers alike face steep competition at a time when the market is in its slow season.
“I believe that buyers are getting an early start on the market to beat the rise in interest rates so that they can get more house for their money and that’s what’s causing this early market,” said Wilson-Flier.
New home buyer Dresden Dorazewski, 28, has viewed 20 homes over the past five weeks with her fiancé Anthony, 29. The couple increased their budget by almost 30 percent, put strong offers on three homes and have lost on all three attempts.
“Even where we’re at right now, we’re still finding that we need to go 10s of thousands of dollars over asking price,” said Dorazewski.
The last home the couple put an offer on, they thought they had. It was a duplex on Osceola and they offered significantly more than the asking price.
“Someone came in with an even stronger offer than ours, $50,000 over asking price and a $10,000 appraisal gap so I mean, it’s comical,” said Dorazewski.
Comical, but stressful. Dorazewski says her fiancé has seriously considered moving to Boise where she says home prices are what Denver’s were 20 years ago.
As a broker, Wilson-Flierl understands the pain.
“You can look at a house that was sold last month in that neighborhood, a new listing comes and boom and it’s already $10,500 more and then we have people over bidding, paying over appraisal so it’s just increasing the prices even more,” Wilson-Flierl said. “It’s heartbreaking. When you hear the clients voice when they lost, you see their face, it’s terrible.”
Wilson-Flierl experienced a rare loss in a bidding war over the weekend and described it like a battle.
“I was wounded this weekend, my clients were wounded this weekend,” she said. “You know, you don’t go into battle without the right armor, without the right tools. We’re doing the same thing with the strategy, with the creativity.”
The big problem Wilson-Flierl says is there are still too many buyers and not enough inventory. When something does list below the average home price, people are paying over appraisal driving the price up.
“You can look at a house that was sold last month in that neighborhood, a new listing comes and boom and it’s already $10,000, $5,000 more and then we have people over bidding, paying over appraisal so it’s just increasing the prices even more,” said Wilson-Flier.
These days it’s not uncommon for Wilson-Flier to go up against 20 other buyers, but she looks at it as a good problem and says, “it’s a tough market, but it’s doable.”