A couple of months ago, I had a conversation with a local real estate broker who really goes deep into measuring the real estate market statistics. He told me then that, adjusted for the overall size of the market, we were seeing the lowest inventory ever.
After he told me that, the inventory continued to shrink.
I just checked the final statistics for February, and — you know where this is going — inventory has shrunk again. In the entire Denver metro area, there are now fewer than 7,000 homes and condominiums available for sale. We are used to seeing somewhere around 25,000 active properties.
Let me say it again: this real estate market is crazy!
I specialize in just a part of the Denver real estate market, so let’s look at those statistics. In “my” real estate market in Highlands Ranch, Littleton, Englewood and Centennial, there are currently only 700 active house and condominium listings, in all price ranges combined. Seven hundred! That’s it. That’s all.
Another way to analyze real estate market statistics is with something called the absorption rate. That’s just a funny way of saying how long it will take for the real estate market to absorb all the current listings, given the current rate of sales. The calculation makes a couple of basically unreasonable assumptions (selling all the listings without adding any new ones), but as long as we use the same calculation all the time, we can see real estate market conditions in almost real time.
So what is the absorption rate telling us right now? Mostly that the real estate market is crazy right now.
Based on the most recent calculations, it will take well less than two months to completely wipe up — to absorb — all the current listings. In Highlands Ranch and Lone Tree, where there are fewer than 200 active listings, it will take just over a month to sop everything up.
Of course, if you’re active in the market as either a buyer or seller, you already know all this. Listings are getting sold in a matter of days if they are properly priced. Multiple offers are not uncommon. With low inventory, high demand and rapid sales, we find ourselves in the midst of a very strong seller’s market. Don’t believe anyone who tells you this is a bad market. In fact, if you’ve even been warming a notion that you might want to sell, now is the time to git ‘er done.
You need to call me. Goodness knows we need more homes on the market.
Let me know what you need from me.
With warmest regards,
Randall Brennan, REALTOR
So what’s next? Take your pick.
Yeah. You should probably do at least one of those things right now.