Last week the Denver Post reported that the “number of homes on the market surged” in August compared to August of 2017, and the Denver Business Journal reported that the “Denver housing inventory hit [a] four year high.” Both of these articles are based on the recently released Denver Metro Association of Realtors’ market trends report. The report shows that the number of available single family homes in the 11 county Denver metro area is up 8.64% year over year.
We found that a bit surprising, so we ran the same report for Central Denver (26th to Hampden and Quebec to Broadway), and found very different results. 463 homes were on the market August of 2017 and only 431 last month, a 6.91% deficit year over year.
We hypothesized that new construction homes were partly to blame for the gap. Densely constructed Central Denver does not offer the opportunity to build like the outskirts of town. In fact, currently in Central Denver 9% of our homes on the market are new build compared to 17% new build outside of Central Denver, an 8% gap.
The new construction gap accounts for slightly more than half of the difference between the two markets’ inventory swing (+8.64% overall market and -6.9% Central Denver market). The remainder may be proof that our market is finally slowing down after six years of stellar growth. We have always counseled our clients that homes farther from downtown and Cherry Creek will feel the market change first. This may be a sign of what’s come for Central Denver.