Denver March 2010 Real Estate Report

Megan Aller with Land Title

This special post created by Megan Aller (more on her later).

The extension of the First Time Home Buyer Tax Credit is having a measurable effect on the number of sales reported by Metrolist in March 2010. The Denver Metro Area has seen an 8.1% increase in the number of reported residential sales. Similar to what Metrolist reported prior to the extension of the First Time Home buyer Tax Credit at the end of November we can hope to see significant positive differentials to be reported once the April statistics are reported and posted here at the beginning of May. Ideally with positive differentials we would like to see another increase in number of sales and sales price reported with a decrease in days on market.

What is interesting is the number of active listings are slightly lower in March of 2010 vs. March of 2009. With the increase in sales and decrease in active inventory the absorption rate is decreasing. This decrease is shifting from the balanced/seller’s market to a more stable balanced market between supply and demand of residential property. The absorption rate may drop again if similar market conditions occur as we saw in the reporting of November 2009 sales at the end of the previous First Time Home buyer Tax Credit.

First time home buyers are generally more likely to purchase a condo property type than a detached residential dwelling. The numbers shown by Metrolist this month echo that statement. Similar to what was reported in the November 2009 stats for condo there was a very significant increase of 30% in reported sales. Again, similar to the residential market with inventory slightly decreasing and sales significantly increasing pushed the absorption rate down from a buyers market into a more balanced market.

When this positive shift in both residential and condo are coupled with a decrease in days on market and an increase in sales price will hopefully help to boost seller’s confidence in the Denver Real Estate Market. This comes at a critical point in the seasonality trend for our market since there is a natural tendency for active listing count to rise in the Spring months.