DENVER — New home listings increased from February to March and properties went under contract at a higher rate but increases in HOA dues and insurance rates priced out some first-time buyers looking to purchase a condo in the Denver real estate market.
The latest Denver Metro Association of Realtors (DMAR) Market Trends Report showed 4,932 new listings in March, which was a 16 percent increase from February but a decrease of just over 3 percent year-over-year.
“Spring is absolutely here and buyers are out looking at homes. In fact, they put properties under contract twice as quickly as they did last month,” said Libby Levinson-Katz, Chair of the DMAR Market Trends Committee, who is a Denver metro realtor.
Spring home inventory is starting to build in Denver according to DMAR, which said active listings at the end of March rose 6 percent from February and increased by nearly 30 percent from this time last year.
“Buyers are out there. And they're absolutely putting properties under contract,” Levinson-Katz told Denver7. “In fact, our pending sales were up by almost 32% month-over-month.”
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Pending March home sales in Denver were 4,317 representing a 7 percent increase year-over-year.
The median days a home stayed on the MLS dropped from 23 days in February to 11 days in March, said DMAR, which was similar to March 2023.
“Both the increase in median closed price and days in MLS showcase that buyers are out there and eager for the new inventory as they placed properties under contract twice as quickly as they did in February,” according to the report.
The median close price of a home in Denver rose by around $30,000 year-over year, which is nearly a 5 percent increase.
Digging deeper, In March 2024 the median home price rose to $595,000 from $567,250 in March 2023.
“Homes priced in that $500,000 to $750,000 price point is really the sweet spot of the market right now where we're seeing the most activity in terms of listings and close sales,” said Levinson-Katz. “And then the most active market segment of the market for condos is that sub $500K marketplace.”
She attributed the rise in condos on the Denver real estate market to increases in HOA dues “in direct correlation with insurance rates coupled with higher taxes and mortgage rates.”
“A lot of buyers are really being, you know, kind of pinched in that first-time homebuyer condo market, which is really unfortunate, because they're the ones that are really having trouble in this market.”
It’s a trend felt across the country, according to Levinson-Katz, who cited a National Association of Realtors (NAR) report stating 3,000 new HOAs were expected to form in 2024.
Currently, 30 percent of U.S. housing falls under a homeowners association, representing around 75.5 million Americans, said the NAR.
The NAR report referenced Rocket Mortgage data suggesting more than half of people with an HOA are not happy with the fees and 1 in 10 thought about selling their home because of an HOA.“Many HOA dues have risen, along with inflation, making some homeowners question if the value they’re getting is worth the cost,” the report added.
A quick search of the Denver metro condo market shows HOA fees can rise to several hundreds of dollars each month and the NAR said across the country, the average HOA fee is $259.
A check of the Denver-area rental market showed a 10 percent drop in active listings and a 3.4 percent increase in rent on a 1 bedroom home year-over-year.
