The Colorado housing market has been in a state of flux over the past few years due to the surge in demand for homes. This has led to an increase in home prices across most regions of the state, making it difficult for buyers to find their dream homes. Currently, the Colorado housing market is favoring sellers, as indicated by a low Months Supply of 2.0 months and a Percent of List Price Received of 98.2%.
These metrics suggest that there is high demand for properties relative to the available inventory, giving sellers more leverage in negotiations. Buyers may encounter stiff competition and potentially higher prices in such a market environment. While it's natural to be wary of market downturns, there is currently no indication of an imminent housing market crash in Colorado.
How is the Colorado housing market doing currently?
- In January 2024, the median price in the Colorado housing market (statewide) was $548,950, up 5.6% year-over-year.
- The Average Sales Price in Colorado was $713,001, up 6.8% year-over-year.
- Percent of List Price Received has increased to 98.2%.
- Average Days on Market Until Sale = 65, up 4.8% year-over-year.
- Closed sales were down by almost 4.4% from last year.
- Pending sales were up by 8.3% from last year.
- Months supply was up by 5.3% to 2.0 months, which is a sign that Colorado is a seller's real estate market.
- New Listings increased by 12.8% year-over-year, which shows a decrease in seller optimism.
Median Price and Average Sales Price
In January 2024, the median price in the Colorado housing market (statewide) stood at $548,950, marking a 5.6% increase compared to the previous year. Similarly, the Average Sales Price in Colorado reached $713,001, reflecting a 6.8% year-over-year uptick. These figures indicate a positive trajectory in terms of property values, suggesting a healthy market.
Percent of List Price Received and Days on Market
One notable metric showcasing the competitiveness of the Colorado housing market is the Percent of List Price Received, which has risen to 98.2%. This signifies that sellers are achieving close to their asking prices, highlighting the demand for residential properties. However, it's essential to consider the Average Days on Market Until Sale, which currently stands at 65 days, reflecting a 4.8% increase compared to the previous year. While homes are fetching favorable prices, they are staying on the market slightly longer, indicating a shift in buyer behavior or market conditions.
Closed and Pending Sales
While Closed sales have experienced a 4.4% decline from the previous year, Pending sales have seen a noteworthy 8.3% increase. This suggests that while finalized transactions have dipped slightly, there is a healthy pipeline of potential sales in the works. It's essential to monitor this trend closely to gauge market sentiment and activity levels.
Months Supply and New Listings
A crucial indicator of market dynamics is the Months Supply, which has risen by 5.3% to 2.0 months. This uptick signifies that Colorado is currently experiencing a seller's real estate market, with limited inventory relative to demand. Additionally, New Listings have increased by 12.8% year-over-year. While this may seem like a positive development, it actually indicates a decrease in seller optimism, as more properties enter the market amidst lingering inventory shortages.
Is Now a Good Time to Buy a House?
Whether now is a good time to buy a house depends on individual circumstances and goals. While the market favors sellers, buyers can still find opportunities, especially with low-interest rates and a healthy pipeline of pending sales. Those considering a purchase should carefully assess their financial situation, long-term plans, and housing needs before making a decision. Working with a knowledgeable real estate agent can also provide valuable insights and guidance in navigating the current market conditions.
Colorado Housing Market Predictions for 2024 and 2025
According to Zillow, the average home value in Colorado stands at $539,151, reflecting a modest 0.8% increase over the past year. This metric is pivotal in assessing the overall health of the housing market, offering insights into trends and patterns.
Days on Market
Homes in Colorado typically go pending in around 27 days, indicating a balanced pace of transactions within the market. This metric is crucial for both buyers and sellers as it influences decision-making and strategy.
Inventory Levels
As of February 29, 2024, Colorado boasts a for-sale inventory of 17,958 properties. This figure encompasses available homes on the market, providing an overview of supply dynamics.
New Listings
4,947 new listings were added to the market as of February 29, 2024, indicating ongoing activity and fresh opportunities for prospective buyers. This metric reflects the influx of properties entering the market within a specified timeframe.
Median Sale to List Ratio
The median sale to list ratio in Colorado, as of January 31, 2024, stands at 0.991. This ratio gauges the relationship between the listing price and the eventual sale price, providing insights into negotiation dynamics and market competitiveness.
Median Sale Price
Colorado's median sale price was $497,267 as of January 31, 2024. This figure represents the middle point of all recorded sale prices, offering a benchmark for assessing property values within the state.
Median List Price
As of February 29, 2024, the median list price in Colorado stands at $552,300. This metric reflects the midpoint of all current listing prices, providing valuable insights for both buyers and sellers regarding market expectations.
Percent of Sales Over and Under List Price
In January 2024, 20.8% of sales in Colorado were over list price, while 55.7% were under list price. These figures shed light on market dynamics, indicating the prevalence of competitive bidding scenarios alongside opportunities for negotiation.
Are Home Prices Dropping in Colorado?
As of the latest data available, home prices in Colorado are not dropping. In fact, the average home value has seen a modest increase over the past year. While there may be fluctuations in specific regions or neighborhoods, overall, the trend is towards appreciation rather than depreciation. However, it's essential to monitor market conditions closely for any changes.
Colorado's housing market currently leans towards being a seller's market. This means that there is more demand from buyers than there is supply of homes for sale. In a seller's market, sellers have the advantage as they can often command higher prices and receive multiple offers on their properties. However, this can make it more challenging for buyers to find affordable homes and negotiate favorable terms.
Regional Colorado Housing Market Forecast
The Colorado housing market forecast varies across different regions within the state, each exhibiting unique trends and projections.
Denver, CO
- Base Date (31-01-2024): The Denver metropolitan statistical area (MSA) started with a modest growth projection of 0.1%.
- 29-02-2024: By the end of February 2024, the forecast showed a slight increase to 1.3%, indicating growing momentum in the market.
- 30-04-2024: Moving forward to April 2024, the growth projection is expected to accelerate to 3.6%, reflecting robust activity and demand.
- 31-01-2025: Looking further ahead to January 2025, the forecast maintains an optimistic trajectory with a projected growth rate of 3.6%.
Denver's housing market appears to be on a solid growth path, driven by factors such as population influx, economic development, and housing demand.
Colorado Springs, CO
- Base Date (31-01-2024): The Colorado Springs MSA also started with a growth projection of 0.1%, similar to Denver.
- 29-02-2024: By the end of February 2024, the growth projection slightly increased to 1%, indicating steady market expansion.
- 30-04-2024: Moving into April 2024, the growth rate is expected to maintain its upward trajectory, reaching 3.9%.
- 31-01-2025: Looking ahead to January 2025, Colorado Springs continues its growth trend with a projected rate of 3.9%.
The Colorado Springs housing market demonstrates resilience and stability, supported by factors such as military presence, job growth, and affordability compared to other metro areas.
Fort Collins, Boulder, Greeley, and Pueblo, CO
- Fort Collins: This region began with a growth projection of 0% on the base date, but is expected to see an uptick to 0.6% by April 2024, indicating modest but steady growth.
- Boulder: Similar to Fort Collins, Boulder started with no growth on the base date but is forecasted to experience a rise to 0.9% by April 2024, reflecting a slightly stronger growth trajectory.
- Greeley: Greeley saw a marginal increase from 0% to 0.5% by February 2024, suggesting gradual market improvement.
- Pueblo: Pueblo experienced a slight decrease in the initial forecast with a -0.2% growth rate, but is projected to rebound significantly to 4.2% by January 2025, indicating a notable surge in market activity.
Grand Junction, Glenwood Springs, Edwards, Durango, Cañon City, and Montrose, CO
- Grand Junction: Starting with a growth projection of 0.2% on the base date, Grand Junction's forecast anticipates a steady increase to 1.1% by April 2024, and further to 4.7% by January 2025, indicating significant market growth and potential opportunities.
- Glenwood Springs: Similar to Grand Junction, Glenwood Springs began with a 0.2% growth projection and is expected to experience robust growth, reaching 1.3% by April 2024 and 6.1% by January 2025, reflecting strong demand and market activity.
- Edwards: With a slightly higher initial growth projection of 0.4%, Edwards is forecasted to see substantial growth, rising to 1.9% by April 2024 and 8.1% by January 2025, highlighting the region's attractiveness and potential for investment.
- Durango: Durango started with no growth on the base date but is expected to see gradual improvement, reaching 0.5% by April 2024 and 4.4% by January 2025, indicating a steady increase in market activity and demand.
- Cañon City: Cañon City began with a growth projection of 0.2% and is forecasted to experience steady growth, reaching 1% by April 2024 and 4.9% by January 2025, signaling positive momentum and market expansion.
- Montrose: Montrose saw a modest increase from 0% to 0.8% by February 2024, indicating gradual market improvement, with further growth expected to 5.1% by January 2025, demonstrating increasing demand and activity in the region.
These regions showcase diverse growth patterns, influenced by factors such as local economic development, population trends, and regional amenities.
Breckenridge, Fort Morgan, Steamboat Springs, Sterling, and Craig, CO
- Breckenridge: Starting with a slightly negative growth projection of -0.3% on the base date, Breckenridge's forecast indicates a gradual turnaround, with growth expected to reach -0.5% by April 2024 and 2.3% by January 2025, suggesting stabilization and potential recovery in the market.
- Fort Morgan: With an initial growth projection of 0.2%, Fort Morgan is expected to see moderate growth, rising to 0.8% by April 2024 and 3.3% by January 2025, reflecting steady market activity and demand.
- Steamboat Springs: Steamboat Springs started with a relatively high growth projection of 0.5% and is forecasted to experience significant growth, reaching 1.7% by April 2024 and 8.7% by January 2025, indicating strong demand and market attractiveness.
- Sterling: Sterling began with a slightly negative growth projection of -0.1% but is expected to see improvement, reaching 0.4% by April 2024 and 3.4% by January 2025, suggesting resilience and potential for market recovery.
- Craig: Craig started with no growth on the base date but is expected to see significant growth, reaching 1.2% by April 2024 and 5.8% by January 2025, indicating positive momentum and increasing market activity.
These regions demonstrate a mix of challenges and opportunities, influenced by factors such as local economic conditions, tourism, and infrastructure development.
Will the Colorado Housing Market Crash?
The Colorado housing market has experienced a significant surge in demand and price appreciation during the past two years, making it a challenging environment for buyers to find affordable homes. While no one can predict the future with certainty, there is currently no indication of a housing market crash in Colorado. The market has shown resilience and stability, with steady growth in home values and demand.
The forecast for the next year predicts a continued slowdown in price appreciation and sales volume, but it is still expected to remain a seller's market. One significant factor that could impact the Colorado housing market's future is the state's economy. Colorado's economy has been robust, with low unemployment rates and a thriving tech industry, attracting a large number of people to the state. However, if the economy were to take a downturn, it could lead to a decrease in demand for homes and a subsequent drop in prices. Additionally, rising interest rates could also affect the housing market, making it more expensive for buyers to obtain mortgages and leading to a decrease in demand.
While there is always a risk of a market crash, it is unlikely to happen in the current scenario. The Colorado housing market has shown resilience to economic fluctuations in the past, and its diverse economy and job growth make it less vulnerable to sudden changes. Furthermore, the state's population growth is expected to continue, which will keep the demand for homes high.
In conclusion, the Colorado housing market has been a challenging environment for buyers in recent years, with high prices and limited inventory. While the market may be slowing down, it is still a seller's market, and prices are expected to continue appreciating, albeit at a slower pace.
Factors such as the state's robust economy and population growth suggest that the housing market is unlikely to crash in the current scenario, but rising interest rates could lead to a decrease in demand and a subsequent drop in prices. Therefore, it is essential to keep an eye on economic indicators and market trends while making any real estate decisions in Colorado.
References:
- https://www.zillow.com/co/home-values/
- https://www.recolorado.com/buy-sell/market-trends/
- https://fred.stlouisfed.org/series/ACTLISCOUCO#
- https://coloradorealtors.com/market-trends/regional-and-statewide-statistics/