2020 may be a stronger year than we originally expected for Central Denver home appreciation. The number of available homes for sale started plummeting last October back to 2018 levels. As you can see from the 2020 dot on the graph below, we’re right in line with 2018, and down 44% from last January.
The 2018 low inventory forced prices up 8.7% that same year. Then inventory started rising through most of 2019, and prices ended flat. The short term increase in 2019 inventory may have been the result of rising interest rates, a slumping stock market, and the threat of a full government shut down.
In addition to the return to low inventory, interest rates are sitting about half a percent lower this January compared to January 2018 and almost an entire point lower compared to 2019. Low inventory and low interest rates sound like a recipe for appreciation. Now we’ll have to see if buyers are willing to swallow escalating prices.