Home prices remain stable despite rate, inventory increases

DENVER — Despite rising interest rates and seasonally increasing inventories, home prices remained mostly flat — and still elevated well above past years — in May across the seven-county Denver metropolitan area, which includes Broomfield and Boulder counties.

“Median pricing for all property types in the Denver-metro area dipped slightly (-1.5%) in May but maintain double digit percentage increases over the same time last year — up 13.5% for single family and 12.6% for townhome/condos,” according to a May trends report from the Colorado Association of Realtors. 

In Boulder County, the median sales price in May was $920,000, up nearly 10% year over year. 

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Broomfield saw its median sales price increase nearly 8% year over year to $687,500, according to CAR.

Regarding the Broomfield and Boulder county markets, the CAR report notes: “The hot seller’s market with bidding wars reaching more than 20% over list price and buyers waiving all conditions was no doubt unsustainable for both the market and the buyers who were in it. Still, stats continue to show a strong, steady market with a handful of new listings and a healthy 13% appreciation in the median sales price. Townhomes and condos are taking it one notch further and have shown appreciation of 20% as compared to last year. Increased activity in this part of the market is likely due to the relative affordability compared to their single-family counterparts.”

Moves by the government to raise interest rates, combined with “fears of continued inflation have put many buyers on pause,” Fort Collins-area Realtor Chris Hardy said in a prepared statement. “Buying a home at an already escalated price is just that much farther out of reach. More homes are coming on the market as evidenced by the 2.5% bump from last May but it’s a mixed bowl of nuts. Also, homes that are not in the best shape are coming to market and the shifting dynamic is proving that homes in the best shape with the best amenities command the best prices and quickest sales. Homes in average or below average shape will linger now that many buyers are on pause or taking time to go on vacation and those buyers active in the market can be a bit pickier.”

Despite the continued price elevation, some experts see the slight decrease in May prices across the Denver metro area as a sign that the market could finally be leveling off.

“With the real estate market this year feeling like a long, seemingly never-ending climb of a rollercoaster, the month of May began feeling as if we are now reaching the peak of that vertical climb,” Douglas County-area Realtor Cooper Thayer said in a statement. “A slight decline in median sales prices is the first sign of a leveling-off in the track. With consumer confidence in the economy decreasing and high mortgage rates pricing out many prospective buyers in the Denver-metro area, I wouldn’t be surprised if we look back at May 2022 as the turning point away from one of the strongest sellers’ markets in recent history. While it has been a struggle for many to buy a home this year, I’d remain optimistic as the market cools and the steep climb of our rollercoaster begins to flatten out.”

Still, buyers should not expect to see bargains anytime soon.

“Make no mistake, the market has not shifted to a buyer’s market and there is not a bubble that burst,”  Boulder/Broomfield-area Realtor Kelly Moye said in a statement. “The interest rate hike did exactly what it was designed to do — cool a frenzied market that needed a correction. Our real estate market is still steady, appreciating, and healthy. It’s just moved from red-hot to a warm, orange glow.”

This article was first published by BizWest, an independent news organization, and is published under a license agreement. © 2022 BizWest Media LLC.