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Colorado Home Prices Up 12 Percent But Inventory Up Too
Buying a home in metro Denver got 12 percent more expensive on average in October, but the supply of homes increased year-over-year, welcome news in a market that has had an inventory shortage for most of the year.
The average price of a home, including both detached single-family houses and condominiums, was $363,718 in October, 12.4 percent higher than in October 2014 when the average price was $323,714.
But active home listings increased by 6 percent year-over-year, according to the latest data from the Denver Metro Association of Realtors. October saw 7,156 active listings in 2015, compared with 6,748 last year.
Months of inventory — or weeks, in this case — is a metric used by real estate professionals to describe the amount of time it would take to sell every home currently on the market at the current rate of sale. A balanced market is considered to have six months of inventory.
Homes were on the market 16 percent fewer days on average, according to DMAR's data. Home stayed on the market 31 days in October, compared with 37 days last year.
From September to October, average home prices increased 2.6 percent as the seasonal slowdown that occurs during winter months continued.
"The seasonal changes we're seeing now and for the next few months will likely be short-lived and buyers will want to take advantage of continued low mortgage interest rates and prices that have settled down after an unprecedented summer," said Anthony Rael, chairman of DMAR's Market Trends Committee.
The CoreLogic (NYSE: CLGX) Home Price Index for metro Denver in September increased 12.2 percent, while the HPI for Colorado went up 10.4 percent, well above the national average of 6.4 percent.
CoreLogic's Home Price Index is a metric meant to provide an indication of home price trends among single-family attached and detached homes. The index is compiled using public record and real estate databases.
"The continued growth in home prices is welcome news for many homeowners but more markets are becoming overvalued. In the near term, this trend is likely to continue and pose evaluated risks to the housing economy," said Anand Nallathambi, president and CEO of CoreLogic. "More has to be done to expand inventories if we are going to address the emerging affordability crisis, especially in hot markets like California and Colorado."
ReporterDenver Business Journal
Marc Blitstein has been a licensed Real Estate Agent since 2004. Real estate experience has been in employee relocation, residential property, short sales, investment property, and bank owned property....
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