Colorado’s Real Estate Market Staying Strong Despite Covid-19

Colorado’s real estate market has been sizzling this summer despite the coronavirus pandemic and flailing economy. Best of all, the real estate market doesn’t appear to be slowing down either as we head into the fall. While the Denver market definitely slowed down during lockdown March and April, the latest reports all point to a real estate market that is remaining strong despiite Covid-19.

Nationwide, pending home sales increased by 44.3% in May, according to the National Association of Realtors (NAR), which was the highest month to month gain in this index since NAR began tracking the metric in January 2001.

When to Buy

Typically Denver’s real estate market is at its most frenetic in May and June when buyer activity peaks. July is usually the start of the cooling period, which runs from August to October. But in June 2020, Denver made up for lost time during quarantine to quickly double the number of units under contract in a typical June, according to data collected by Megan Aller, an account executive at First American Title. 

“In 2020 Denver still measures as an Extreme Seller’s Market,” Aller said. “This metric (see above photo) shows signs of another compressed cycle. This metric is one of the most important metrics in measuring shit. A balanced market would report a value of 6.0 months.” 

Home price reductions in June were down by only 1% when compared to the previous years at the same time with approximately 22.8% of greater metro Denver homes closing with at least one price reduction, according to the First American Title Report.

That said, with home prices continuing to climb, buyers are becoming more picky about their home purchase. Properties that are pushing the limit price-wise are predicted to be more likely to make larger and more frequent reductions in 2020. 

If you are looking to buy the largest price reductions will most likely be between October and December. 

Odds of Selling

Odds of selling also remained very high in June 2020, which may be due to many homes going under contract pre-Covid-19 before Denver’s quarantine at the end of March. Overall it is expected that 2020’s odds of selling will continue to soar despite Covid-19, due to low interest rates and minimal inventory. 

The time homes spent on the market before sale also remained on par with previous years in Denver. In June the average number of days on market was 22. In the coming months, however, so long as Covid-19 remains an extended event, it is expected that the number of days on the market will eventually increase. 

To Sum It Up

Buyers are most likely to have negotiating power in the mid-summer and fall. Sellers late to the market in the summer months can expect their homes to spend longer on the market and to have to sell at lower prices than spring sellers, according to the First American Title report.