The Luxury Market ended the first quarter of 2018 as if it were Summer already! Sales over 1 Million were up fifty two percent in March compared to February and year-to-date sales have tripled since 2014. In Q1 2014 there were 121 compared to an astonishing 381 homes sold so far this year. Months-Of-Inventory is down further with last month carrying 5 months of inventory. As discussed in last month’s issue, the shift to below 6 indicates a sellers’ market.
In the Signature Market ($750k-$999k), the big buzz has been all about the condos! With a nearly 80% increase in sales year-to-date, it seems March Madness extended itself to the signature condo market with both buyers AND sellers out in full force. These homes are closing an average of 98.6% of list price at an average of $317 per square foot. One would think the gains in appreciation are tremendous, right?
Not exactly. While sales have nearly doubled from 54 in Q1 last year to 97 in Q1 this year, we don’t see much of a change in the other metrics. The median sold price only increased 1% from $820,000 to $828,000, Days-On-Market is up to 42 and, yet, Close Price/List Price remains essentially unchanged. Though we are selling nearly twice the number of units, they are not gaining in value the way other categories are. Why would that be? I have a couple ideas… First of all, not all of these are your traditional “condos” but rather the townhouses you see going up on every metro block in Denver. Technically we are not comparing apples to apples, and the rapid pace at which these townhouses are built there is bound to be a jump in number of homes sold. Secondly, simply put, there has been both and increase in supply AND demand. Many sellers of these condos are either move-up buyers looking to purchase a house or investors looking to cash in on their units. For buyers, we are seeing a preference for the turn-key life style.