June 2020: Most Pendings in Denver HISTORY (!?)

Metro Denver hit an all-time record in June: highest number of homes that went under-contract EVER, with 7,676 homes/townhomes/condos that went pending in June. That is 27% more than June 2019, and the most in any month in Denver HISTORY! I'm seeing this first-hand as I've been in constant bid-wars for buyers and receiving multiple competing offers for sellers, all $15,000 to $30,000 over asking-price! It's a ruthless shark-frenzy out there, but fortunately I've been able to make my buyers the winning offer, and get my sellers extremely high offers and excellent terms for their homes. One of my listings had 12 extremely strong offers in less than 30 hours! This is actually not a seller's market: it is a hyper-seller's market. 

What is causing this HUGE demand for housing
in an unstable economy?

I think one of the main reasons for this huge demand in housing is the experience of the quarantine. Families and roommates are much more aware of the need for the security of a home during things like a global pandemic, and the necessity and functionality of different spaces in a post-COVID world: spaces where kids can play or do school work, offices where adults can actually work in peace (which aren't the master bedroom...or bathroom lol!), basements which can provide a whole other recreational flex space, backyards to be able to get out of the house, garden, and enjoy sunsets and cooler evenings. The psychology of a home and our understanding of it is returning back to its original value and essentiality: it is so much more than a place to store your stuff and sleep, or be "tiny": it is your safe place where much of life actually happens.

A few other interesting stats:

• There were 57% more closings in June than May (COVID-induced lull for May)
• There is half a month of inventory from $200k to $500k which is about as scarce as it gets in real estate. There is 1 month of inventory from $500k to $750,000.  $750k-$1MM has 2 months of inventory (still a hot seller's market), and $1MM+ has 4.3 months of inventory, which actually represents a "balanced market."
• The averaged closed price was 2% higher than June 2019 at $509,736
• The average number of active listings from 1985 to 2019 was 16,376. There were 6,383 active listings at the end of June.
• 2,427 homes went pending in the last 7 days. There are currently 8,237 homes under contract. June's all-time record may be broken by July. 
• There are only 5,573 active homes for sale right now.
• Interest rates are at 3.125% today for a 30-year loan! 

Who is this market good for: renters to get in at lowest interest rates in history, and sellers to upgrade from small home to bigger home, realize serious equity, and have a similar monthly payment on the bigger home because of their equity and low interest rates. 

Some Economists Claiming this as Shortest Recession in History

Jobs Numbers and Unemployment rocked the news this week with numbers that defied the recession.  ADP Jobs Report came out first on Wednesday SIX million lower than expected pushing the Nasdaq just shy of a record high and recouping all of its losses for 2020.  

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Thursday's Jobless Claims released on Thursday on the other hand showed while initial claims dropped again, the continuing claims rose as some returned to work, but others are hanging onto their COVID unemployment pay.

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Friday's May Unemployment Rate took the prize though.  Surprising almost everyone by dropping from 14.7% in April to 13.3% in May.  Many economists were expecting the bottom to hit in May.  The report showed we hit the bottom in April instead.  We had a gain of 2.5 million jobs as restaurants, hotels, and yes.. even Universal Studios reopen.  Let's face it.. American's want to travel, we want to be entertained.  

Did the stock market know before the economists?  Seems so!  Watch out though.. Greed returns to Wall Street as the Fear-Greed Index just tipped over to Greed this week.  Are we in store for a correction? 

Regardless, the metro Denver housing market is still strong, with less than 2 months of inventory, and buyers and sellers coming back quickly, seen by multiple offers on many new listings.   

Denver Ranked Top 20 'Future-Proof' Markets in the World

According to HousingWire, recent research suggests that some of America’s most popular cities, including our own Denver, CO, are fully prepared to tackle long-term socio-economic and commercial real estate momentum, states Jones Lang LaSalle, the popular financial and professional services firm. 

JLL is the creator of the City Momentum Index, which covers 131 global major established and emerging markets and tracks factors that determine which cities have the strongest short-term socio-economic and commercial real estate momentum, and those that are more equipped for long-term success.

Short-term momentum is determined by both socio-economic and commercial real estate momentum. Economic output, population, investment transactions, transparency, construction, consumerism are factors in JLL's analysis.

According to JLL, future-proofed cities have higher education infrastructures, innovation capability, better environment quality, more technology firms and international patent applications.

The firm's analysis ranked the top 30 most future-proofed markets in the world, as well as those with short-term momentum. While Seattle was the only American city to appear on the short-term list, 12 American cities were among the top 30 most future-proofed markets globally.

San Francisco topped the list as the no. 1 city in the world to have the most sustainable long-term market with nearby Silicon Valley ranking second. Other major U.S. cities claiming spots on the list include New York, Boston, Los Angeles, San Diego, Chicago, Seattle, Austin, Denver(#10 in U.S. and #20 in the world), Washington D.C. and Philadelphia made an appearance on the list, which you can check out below: 

Denver Homes Sold Faster in April than anywhere in the U.S.

Homes in Denver sold faster in April than anywhere else in the country.

According to a new report by online real estate company Redfin, Denver was the fastest market in the country last month, with half of all homes pending sale in just six days. That was faster than Seattle (seven days), and San Jose, Grand Rapids, Michigan, and Tacoma, Washington (nine days).

Over the past year, Redfin estimated that the median home sale price has risen 9.2 percent in Denver to $415,000.

That's higher than the rest of the country, which saw the national median home sale price increasing 7.6 percent in April from a year ago, to a median of $302,200, according to Redfin's report released Thursday.

And Denver's near the top nationally in some other housing categories as well.

The metro areas with the lowest days on market were San Francisco at 19, Seattle at 21, and Denver at 23, according to Re/Max's National Housing Report, released Wednesday.

Denver is tied for markets with the lowest Months Supply of Inventory with Boise, Idaho, San Francisco, and Seattle, at 1.0. A six-months supply historically indicates a market that's balanced equally between buyers and sellers, according to the Re/Max report.

With the extremely low supply, sellers are still having a hay-day in the Denver Metro area.

-Denver Business Journal

Denver Ranked #2 BEST City to Live

For the 2nd year in a row Denver was named either #1 or #2 BEST city to live in the country. This year it was #2 - perhaps it would have been a bit embarrassing should it have gotten #1 both years in a row!

The key factors were demanding for any city:
1) Value of homes.
2) Quality of life.
3) Job market health.
4) Desire to live here.
5) Number of people moving here.

Check out what US News & World Report had to say: 

"Founded in the mid-1800s as a mining hub during the gold rush, Denver has come a long way since its Wild West days. Over time, its residents have evolved from gun-slinging gamblers into an easygoing crowd of ambitious, progressive-minded fitness fanatics and nature lovers who are eager to push the envelope on everything from civil rights to drug laws. Nicknamed the Mile High City for its 5,280-foot elevation (although officially reported as 5,279 feet), Denver's location at the base of the Rocky Mountains provides a gateway to a slew of outdoor pursuits, although it is probably best known for its devout ski and snowboard enthusiasts.
To clarify a common misconception, Denver is not a mountain town. It actually takes at least an hour to drive to the Rockies. But there are some great places for recreating within a 30-minute drive of downtown, such as Red Rocks Park and Cherry Creek State Park.  
Some might say that Denver is experiencing a gold rush of a different color: green. After Colorado residents voted to legalize recreational marijuana in 2012, Denver has seen a surge in cannabis-related commerce, from dispensaries to magazines to high-tech paraphernalia like vaporizers, rolling papers, lotions and storage containers – and the industry is just gaining speed."

Mortgage Rates Slightly Up,

Buyers are Still Coming

   

Mortgage rates may have inched up slightly but that didn't seem to deter home buyers from shopping for a loan last week. Mortgage application volume rose 2.3 percent week-over-week on a seasonally adjusted basis, driven by an uptick in home purchase applications, the Mortgage Bankers Association reports. Mortgage applications are nearly 24 percent higher than they were a year ago.

After a short dip, mortgage applications for home purchases reversed course last week and rose 5 percent. Purchase applications are 17 percent higher than a year ago.

"Purchase applications got back on track last week, resuming the level of activity observed throughout most of April and May," says Lynn Fisher, MBA vice president of research and economics. MBA also reported that the average loan size for purchase applications rose to a survey high last week, reaching $307,700.

Meanwhile, applications for refinancing mostly held flat last week, budging just 0.4 percent during the week. MBA reports the average on a 30-year fixed-rate mortgage rose to 3.85 percent last week, up from 3.82 percent the prior week.

 

Source: RealtorMag

Denver Post: Denver-area Home Sales Climb in April

Denver Post: Metro-Denver home sales climbed in April as the spring home-selling season kicked off.

Buyers placed 5,681 homes under contract in April, up 7 percent from March and up 20 percent from April 2011, said independent real estate consultant Gary Bauer.

"It is pretty amazing. Everything is up. Denver is one of the strongest markets out there," he said.

Bauer's comments were based on an analysis of data supplied by Metrolist Inc . The Denver-area housing market has recently heated up in certain price ranges due largely to extremely low inventory prompting bidding wars for some properties.

In April, 10,254 homes were listed for sale, down from roughly 18,000 a year ago.

"With low inventory of homes for sale, homes are selling on average close to the listing price," Bauer said.

The average price for a single-family home was $298,712, up 5 percent from March, and up 10 percent from April 2011.

The average condo price was $178,231 in April, up 10 percent from March and 12 percent from April 2011.

Bauer said he was not ready to describe it as a sellers' market.

"I contend that we are not totally in a sellers' market," he said. "There are certain neighborhoods and price ranges where there is still a lot of inventory."