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Jennifer Steck (Rocky Mountain Homescapes, Keller Williams Denver Central): Real Estate Agent in Denver, Denver County, Colorado


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First Quarter 2008 Denver Area Residential Absorption Rates

House in CartThere are no areas during the first quarter of 2008 that we would consider to be Seller’s Markets. We’ve moved into a neutral market in most residential areas, but this will change as the year moves on. Buyers will be aggressively negotiating in those areas that have increased supply on the market.

I have seen a marked increase in showings on my listings just in the last few weeks, so the spring and summer buyers are out and looking. This will change our report for next quarter possibly into more of a seller’s market in a few areas.

Considering Absorption Rate is one way to measure the health of our real estate market. Absorption Rate designates the number of months of housing supply on hand. The larger the supply, the more competition there is for sellers and the higher likelihood that prices will drop or concessions will be offered. The market has definitely slowed in the last quarter.

More Months of Supply = Buyer’s Market = Possible Reduced Pricing and/or Concessions

Fewer Months of Supply = Seller’s Market = Possible Price Increases and/or Bidding Wars

The commonly accepted separation between markets is:

Seller’s Market          1-4 months of supply
Neutral Market          5-6 months of supply
Buyer’s Market          7 months and above
 
Single Family Homes
 

Area

Jan 

AR

Feb

AR

Mar

AR

Avg.

AR

Market

Condition

Aurora North

 6.99

6.51

5.73

6.41

Neutral 

Aurora South

 6.12

6.36

5.23

5.90

Neutral

Broomfield

 9.54

 9.61

8.14

9.10

Buyers

Douglas Cnty West

 10.21

14.18

10.12

11.50

Buyers

Douglas/Elbert/Parker

 10.94

 9.73

8.57

9.75

Buyers

Highland Ranch/Lone Tree

 5.11

 5.17

5.37

5.22

Neutral

Denver Northeast

 7.25

 7.38

5.73

6.79

Neutral

Denver Northwest

 6.22

 6.58

6.28

6.36

Neutral

Denver Southeast

 9.99

10.64

9.03

9.89

Buyers

Denver Southwest

 6.49

6.85

5.91

6.42

Neutral

Jeffco Central

 6.86

8.56

5.12

6.85

Neutral

Jeffco North

 5.00

5.89

4.59

5.16

Neutral

Jeffco South

 5.23

6.86

5.60

5.90

Neutral

Jeffco West/Golden

 7.73

7.11

6.83

7.22

Buyers

Jeffco North Central

 6.54

6.74

4.42

5.90

Neutral

Jeffco South Central

 5.45

6.75

5.63

5.94

Neutral
 
 
 
Check out the average absorption rate in Northwest Denver. At 17.52 months of supply for the first quarter, it is tough to get your home sold. It may, however, be a great place to get a wonderful deal if you are looking to buy.
 
Condominiums/Townhomes

Area

Jan 

AR

Feb

AR

Mar

AR

Avg.

AR

Market

Condition

Aurora North

 5.57

5.71

5.89

5.72

Neutral 

Aurora South

 7.87

6.57

5.69

6.71

Neutral

Broomfield

16.0

 29.0

7.00

17.33

Buyers

Douglas Cnty West

 6.79

 9.83

 7.25

7.96

Neutral

Douglas/Elbert/Parker

 8.07

 5.36

 6.68

6.70

Neutral

Highland Ranch/Lone Tree

 6.09

 9.33

 8.61

8.01

Neutral

Denver Northeast

20.89

11.85

19.85

17.53

Buyers

Denver Northwest

10.08

8.44

16.44

11.65

Buyers

Denver Southeast

 9.76

10.30 

11.07

10.38

Buyers

Denver Southwest

 9.04

9.48

7.43

8.65

Buyers

Jeffco Central

 7.00

6.69

6.92

6.87

Neutral

Jeffco North

 3.36

8.00

7.33

6.23

Neutral

Jeffco South

 8.31

7.66

7.42

7.80

Buyers

Jeffco West/Golden

 6.89

4.82

6.67

6.13

Neutral

Jeffco North Central

 8.47

8.47

4.41

7.12

Neutral

Jeffco South Central

 6.88

7.86

5.95

6.90

Neutral
 
There are fewer homes on the market compared to prior years. It appears many prospective sellers are planning to wait this market out. Are we recovering? We are all keeping our fingers crossed and that may be the best we can do right now.
 
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This entry was posted on Wednesday, May 7th, 2008 at 4:29 am and is filed under Buyers and Sellers, Market Activity, Real Estate News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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  1. Keahi Pelayo May 9th, 2008 at 12:19 pm

    Very complete.
    Aloha,
    Keahi
    RE/MAX 808 Realty

  2. Jennifer May 10th, 2008 at 6:58 am

    Keahi- Looking at the actual numbers instead of just the stories in the media give a much more complete picture. I hope the market in Hawaii is doing much better. Thanks for visiting.

  3. Susan Hilton - Texas Aggie Realtor May 11th, 2008 at 8:42 pm

    Glad to see you guys are beginning to see a change. It is sad that the media won’t report this but if you see a blip the other way they will be all over it!

    Susan Hilton - Realtor & Sales Trainer for Century 21 Beal, Inc. #1 in Real Estate in Bryan and College Station Home Sales - Bryan College Station Real Estate & Community Blog

  4. Jennifer May 13th, 2008 at 4:21 am

    Susan- The market has definitely been slow here, but we are actually in pretty good shape compared to other areas of the country. The buyers have come out in the last month and houses are selling so next quarter we will see a much improved picture.

  5. Donte - Charlotte Real Estate June 9th, 2008 at 8:06 am

    This might be a good time for me to come an invest in Denver. A buyers market is the best market to get bargain properties that will appreciate once the market starts to correct itself.

    Donte from NC

  6. Sean O'Hara June 29th, 2008 at 10:43 pm

    Always good to see the positive data reported. I think we’re well positioned, just have to wait for confidence to creep up and banks to start lending.

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