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How has COVID19 Affected the Denver Real Estate Market?

Nine months into the Covid-19 pandemic, we have collected some data and feel ready to talk about how this pandemic has impacted the Denver real estate market. Since staying home has become a new way of life, it is logical that the demand for housing has hit an all-time high.

Covid Deals

At the onset of the pandemic, there was a slight opportunity to find a good deal for three months. Those who were willing to purchase amid uncertainty were rewarded (see price decreases below in light blue April, May, and June).

On April 11th the Colorado Real Estate Division banned in-person home showings until May 1st. Offers were being made without seeing properties, inspectors went in and emailed reports and closing happened in parking lots.

Demand for Homes

Why would anyone buy under such conditions? Well, at this point everyone needed an extra 1000 sf. Not only were they working from home but they also had kids homeschooling, needed a place for their new Peloton bike, and no escape (aka vacation) insight. Only around 7% of U.S. employees regularly worked from home before the COVID-19. 62% of US employees are working from home now.

Remote Workers with Expendable Income

The demand for extra space has become a priority for many at the same time people actually experienced increased savings. In addition to receiving stimulus money, many saw their monthly bills decrease. Savings were achieved in many categories including commuting, travel, restaurant/bars, entertainment, fitness, personal services, etc. We actually saw personal saving rates increase in April 2020.

Boom in Refinancing

At the same time, most homeowners were able to refinance at a lower interest rate and decrease their monthly housing costs. With interest rates hovering at historic lows of around 3 percent for a 30-year fixed-rate loan, refinance mortgages originated in the second quarter of 2020 represented an estimated $513 billion in total dollar volume. That number was up 130 percent from a year ago, to the highest point in almost 17 years.

 

We expect total mortgage originations to reach $1.1 trillion in Q3 2020 and $3.6 trillion for the full year 2020. For Q3 2020, refinance originations to be $670 billion.

Lowest Interest Rates
in History

CPR says that 9 in 10 people in Colorado were employed in July 2020. Those people were working from home, had a boost in savings, and were looking to take advantage of low-interest rates. Lower interest rates counterbalance a higher list price and make their monthly payment manageable. I looked back at Mortgage Rates and home values from Zillow and did some quick monthly payment calculations assuming 20% down.

 

Oct 2016 / 3.42% / $377K = $1636/m

Oct 2017 / 3.85% / $409K = $1850/m

Oct 2018 / 4.9% / $446K = $2226/m

Oct 2019 / 3.65% / $449K = $1975/m

Oct 2020 / 2.88% / $469K = $1900/m

With the lower rates, home prices started to increase again in July. As prices started to soar buyers were unphased. The list price is irrelevant to buyers because they are focused on the cost of their monthly payment.

 

Competition Pushed
Up Prices

Demand has been strong and inventory has lagged behind. Active inventory between September 2019 to September 2020 is down 42.91% according to DMAR. The low inventory resulted in bidding wars. There aren’t widely available stats so we counted up the number of offers we received on each listing and the number of offers each buyer wrote to get their offer accepted based on Living Room’s transactions. As a whole, it took 2.5 offers per sale within our brokerage since Covid started. It was our experience that single-family homes were more competitive and required closer to 3.5 offers per sale while condo and townhomes were closer to 1.4 offers.

Double the Work

Naturally, it follows that real estate agents were busier than ever during Covid. We are writing 2.5 offers per client and that doesn’t take into effect the number of showings required. In addition, lenders were extremely busy with refinances in addition to new purchases. Lastly, the title companies doubled their workload – instead of one closing with the buyers and sellers, they had to do two separate closings – one for the buyers and one for the sellers. It was double the work all around and we did it in masks.

Low Inventory and
Off-Market Deals

In the graph below you can see the dotted blue line where we expected inventory to be this year before Covid changed the scenario. The solid blue shows our actual inventory. It is shocking to see more homes pending and closed than active inventory.

 

How is that possible? Answer – many homes sold without ever being listed on the market. The sales were recorded by brokers after the fact. Within our brokerage it happened – friends selling homes to friends, renters buying from their landlord, or buyers placing offers on off-market properties.

Prices Going Up

The high demand for homes in Denver and low inventory is pushing prices up. Since last year, prices in Denver are up 6.4% according to Zillow and predicted to keep going up. Costs are also increasing for building – lumber is a major factor but throughout the supply chain prices are increasing across the board.

People on the Move
During Covid

Covid created major change and the change resulted in many moves. According to the Postal Service’s Change of Address requests, over 15.9 million people have moved during the coronavirus. The national trend was a move from cities to the suburbs or smaller towns. Many Denver residents looking for more space left the city. At the same time, Denver has witnessed an influx of new residents from bigger cities. Working remotely has given people the ability to live anywhere and people want to live in Denver. Our city is more open than other cities and we’ve been lucky to not be the center of a major

 

It’s important to note that the net losses experienced by big cities eclipsed the net gains experienced by the smaller cities. Residents relocating from big cities spread out to smaller areas across the country. A Denver Post opinion piecesaid, “A new wave of urban migrants may be crashing into the suburban and rural West. You could even call them COVID migrants.” People living in Denver are moving to more affordable “Zoom towns” in rural areas. The rural real estate market nationwide has taken off much faster than in urban areas.

 

You can see in the graph above that Highlands Ranch, Broomfield, Thornton, Parker, and Evergreen are very in-demand areas while the city center is actually a buyer’s market. People need and want more space. Walkability and the length of commutes is less relevant.

What now?

Typically this time of year is when demand starts to decrease. However, the showings stats below demonstrate that showings have consistently increased month over month since the big dip in April 2020. Masks and other precautions are being taken, but buyers are on a mission to get into a home. The election and holiday will slow down buyers, but we expect a robust 2021.

Conclusion

It was hard to predict how the pandemic would affect the real estate market in Denver early on. Now that some time has passed, we see that stay-at-home orders, low-interest rates, and movement has created a huge boost in demand and therefore prices. Sellers are experiencing the tangible benefits of these price increases when they go to sell, while buyers are battling it out in multiple offer situations. Those lucky enough to win in a bidding war are saved by low-interest rates that make their monthly payment manageable. If Denver can weather the recession of the 2020 pandemic, I’m optimistic about the years to come.

Posted in: Blog, Housing Market Update

Congratulations / First time home buyer in Villa Park!

927 King Street, Denver
3 beds / 2 baths
Kassidy Benson, Buyer’s Agent

Alex started looking for a home last year. After considering many options, he identified Villa Park as his ideal location. This summer we looked at many homes and he made 9 offers. Alex persisted with energy. When we were both out of town, a great home came on the market and Lisa was able to go see the property and send videos. After many losses, he knew what he would have to do to win and got really aggressive and the seller took his offer early on Saturday. The inspection did not go well, but I negotiated a $35K price reduction for Alex. 

Learn more about this listing

Posted in: Blog, Our Clients

Coming soon in Uptown. 2 BED / 1BATH Condo

Coming soon: 325 E 18th Avenue Unit #302, Denver, CO 80203

2 BED / 1 BATH / 763 SF Uptown Condo.

https://livingroomdenver.com/wp-content/uploads/2020/11/325-e-18th.mp4

Posted in: Blog, Listings with Living Room

Investment Property in Centennial

5555 S Briarwood, Centennial, CO
2 Beds / 2.5 Baths / 1,528 SF
Purchased for $330,000.
Kassidy Benson, Buyer’s Agent

Fran and Mikey purchased this home completely remotely. As soon as a listing would pop up, I would go meet Mikey’s mom for a tour and send the guys videos. We lost out on three offers and we walked away from home due to a poor inspection. Finally, the perfect place was available and we got it under asking price! I handled the inspection and they finally saw the townhouse only a few days before closing. Luckily they liked it and we closed!

Learn more about this listing.

Posted in: Blog, Our Clients

Renovated Ranch SOLD in Skyland

 

3080 Monroe St, Denver, CO 80205
3 bedrooms / 2.5 bathrooms / 1637 SF
Sold for $630,000.
Kassidy Benson, Seller’s agent

After a four-month rehab, this beauty attracted a buyer the first weekend on the market. We received multiple offers but went with an all-cash offer, $5000 over the asking price, that closed in only two weeks.

Learn more about this listing

Posted in: Blog, Our Clients

Hoffman Heights 3 bed/2 bath brick ranch / Just Listed

880 Ursula Street, Aurora, CO 80011—-$395,000

3 Bedrooms / 2 Bathrooms / 1,621 SF with a one-car attached garage.

Character abounds in this respectfully updated Hoffman Heights 3 bed/2 bath brick ranch with one car garage 5 minutes from Anshutz medical campus and light rail.

https://livingroomdenver.com/wp-content/uploads/2020/10/880-ursula-1.mp4

Posted in: Blog, Listings with Living Room, Uncategorized

SOLD in Central Park

 

3581 Akron Street, Denver CO
3 beds / 3 baths / 1,666SF
Taylor Whitton, Seller’s agent
Learn more about this listing

Posted in: Uncategorized

SOLD in Thornton

11506 Monroe Way, Thornton, CO
3 bedrooms / 2.5 bathrooms / 2,002 SF –
Listed for $415,000 – Sold for $425,000
Kassidy Benson, Seller’s Agent

Tyler called me seeking some advice about renting his home. Covid was forcing his family to move. It didn’t seem feasible to make a profit after owning the home for only two years. However, I found that they had plenty of equity. We spiffed the place up with some beautiful staging and got $10K over asking the first weekend with multiple offers. With no major improvements, their value had gone up $60K in two short years. Tyler and his family were able to sell, cash out on their equity, and purchase a new home in Idaho – a market experiencing a big boom where he hopes the next two years will bring them the same good fortune. 

Learn more about this lisitng

Posted in: Blog, Our Clients

Stunning renovated Ranch in Skyland – Just listed

2900 Monroe Street, Denver CO 80205

3 beds / 3 baths / 1,907 SF

Stunning remodel on an expansive 3 bedroom with 3 en suites one level brick range on a huge corner lot. Fully permitted rehab by Rog&Wilco includes all NEW: kitchen + bathrooms, doors, all plumbing, all electrical, wall + attic insulation, drywall + paint, siding, all flooring, garage door, sprinklers, sod, and fence.

https://livingroomdenver.com/wp-content/uploads/2020/10/2900.mp4

 

Posted in: Blog, Featured, Listings with Living Room Tagged: city park, Denver, for sale, new listing, real estate, skyland

HAPPY Buyer in Park Hill

Adam called me after walking into an open house in November 2020. Without ever meeting, I drafted an offer and we submitted right away. Unfortunately, we did not win the multiple offer situation. Adam didn’t give up, but as a sophisticated user of Zillow continued to identify homes that were listed low that ended up going way over asking price. We changed our approach and had luck with an overpriced listing that had been on the market for over 14 days. We got it under asking, he got $10K towards his down payment, and all of his closing costs covered. First one down, many more to come for this guy!

3328 Glencoe Street
Kassidy Benson, Buyer’s Agent

Posted in: Blog, Our Clients

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Featured Properties

2789 W College Avenue $419,900

2789 W College Avenue Denver, Colorado

3 Beds 2 Baths 1,425 Sq Ft 0.400 Acres

Sale Type: Active Listing courtesy of Megastar Realty

2730 W Mississippi Avenue 9 $419,900

2730 W Mississippi Avenue 9 Denver, Colorado

3 Beds 2 Baths 1,880 Sq Ft 0.080 Acres

Sale Type: Active Listing courtesy of HomeSmart Realty

4000 Fillmore Street $420,000

4000 Fillmore Street Denver, Colorado

3 Beds 2 Baths 1,043 Sq Ft 0.130 Acres

Sale Type: Active Listing courtesy of Keller Williams Executives

2010 S Irving Street $420,000

2010 S Irving Street Denver, Colorado

3 Beds 2 Baths 1,449 Sq Ft 0.160 Acres

Sale Type: Active Listing courtesy of inMotion Group Properties

4465 W Custer Place $425,000

4465 W Custer Place Denver, Colorado

5 Beds 2 Baths 1,448 Sq Ft 0.140 Acres

Sale Type: Active Listing courtesy of Compass - Denver

2865 W Mexico Avenue $440,000

2865 W Mexico Avenue Denver, Colorado

4 Beds 2 Baths 1,950 Sq Ft 0.150 Acres

Sale Type: Active Listing courtesy of HomeSmart

309 Reed Street $445,000

309 Reed Street Lakewood, Colorado

3 Beds 2 Baths 2,090 Sq Ft 0.340 Acres

Sale Type: Active Listing courtesy of Elevate Real Estate

2809 S Lincoln Street $450,000

2809 S Lincoln Street Englewood, Colorado

2 Beds 2 Baths 1,060 Sq Ft 0.100 Acres

Sale Type: Active Listing courtesy of Colorado Real Estate Sales and Property Management

1360 S Osceola Street $459,900

1360 S Osceola Street Denver, Colorado

4 Beds 2 Baths 1,335 Sq Ft 0.170 Acres

Sale Type: Active Listing courtesy of Metrowest Real Estate Solutions

1800 W Jewell Avenue $473,000

1800 W Jewell Avenue Denver, Colorado

3 Beds 2 Baths 2,056 Sq Ft 0.140 Acres

Sale Type: Active Listing courtesy of Opendoor Brokerage LLC

7135 W Ellsworth Avenue $480,000

7135 W Ellsworth Avenue Lakewood, Colorado

4 Beds 2 Baths 2,392 Sq Ft 0.310 Acres

Sale Type: Active Listing courtesy of RE/MAX MOMENTUM

1004 S Quitman Street $485,000

1004 S Quitman Street Denver, Colorado

3 Beds 2 Baths 1,140 Sq Ft 0.150 Acres

Sale Type: Active Listing courtesy of The Devonshire Company

416 S Leyden Street $489,000

416 S Leyden Street Denver, Colorado

3 Beds 2 Baths 1,634 Sq Ft 0.150 Acres

Sale Type: Active Listing courtesy of Your Castle Real Estate Inc

1290 S Tennyson Street $497,000

1290 S Tennyson Street Denver, Colorado

3 Beds 2 Baths 1,512 Sq Ft 0.170 Acres

Sale Type: Active Listing courtesy of HomeSmart Realty

93 Yates Street $499,000

93 Yates Street Denver, Colorado

4 Beds 2 Baths 1,606 Sq Ft 0.140 Acres

Sale Type: Active Listing courtesy of John Hernandez Realty

5343 Julian Street $499,000

5343 Julian Street Denver, Colorado

4 Beds 2 Baths 1,540 Sq Ft 0.290 Acres

Sale Type: Active Listing courtesy of RE/MAX Professionals

1255 Fairfax Street $500,000

1255 Fairfax Street Denver, Colorado

3 Beds 2 Baths 1,546 Sq Ft 0.140 Acres

Sale Type: Active Listing courtesy of West and Main Homes Inc

2258 S Zurich Court $500,000

2258 S Zurich Court Denver, Colorado

6 Beds 2 Baths 2,140 Sq Ft 0.180 Acres

Sale Type: Active Listing courtesy of Keller Williams Realty Downtown LLC

2467 Depew Street $520,000

2467 Depew Street Edgewater, Colorado

2 Beds 2 Baths 1,284 Sq Ft 0.150 Acres

Sale Type: Active Listing courtesy of Kentwood Real Estate City Properties

4800 Quivas Street $525,000

4800 Quivas Street Denver, Colorado

3 Beds 2 Baths 1,064 Sq Ft 0.130 Acres

Sale Type: Active Listing courtesy of Brokers Guild Homes

2443 S Williams Street $529,000

2443 S Williams Street Denver, Colorado

3 Beds 2 Baths 1,326 Sq Ft 0.060 Acres

Sale Type: Active Listing courtesy of Feder Commercial Realty Advisors LLC

6001 W 35th Avenue $535,000

6001 W 35th Avenue Wheat Ridge, Colorado

5 Beds 2 Baths 2,224 Sq Ft 0.260 Acres

Sale Type: Active Listing courtesy of Brokers Guild Real Estate

3146 N Milwaukee Street $550,000

3146 N Milwaukee Street Denver, Colorado

4 Beds 2 Baths 1,612 Sq Ft 0.160 Acres

Sale Type: Active Listing courtesy of Keller Williams DTC

2350 W Moffat Place $550,000

2350 W Moffat Place Denver, Colorado

3 Beds 2 Baths 1,812 Sq Ft 0.240 Acres

Sale Type: Active Listing courtesy of Keller Williams Realty Success

2100 N Monaco Parkway $550,000

2100 N Monaco Parkway Denver, Colorado

3 Beds 3 Baths 2,674 Sq Ft 0.220 Acres

Sale Type: Active Listing courtesy of Compass - Denver

3978 Harlan Street $575,000

3978 Harlan Street Wheat Ridge, Colorado

3 Beds 2 Baths 2,119 Sq Ft 0.210 Acres

Sale Type: Active Listing courtesy of ENLIGHTEN REAL ESTATE GROUP

3140 W 8th Avenue $575,000

3140 W 8th Avenue Denver, Colorado

4 Beds 2 Baths 1,924 Sq Ft 0.130 Acres

Sale Type: Active Listing courtesy of Sterling Realty Group

3501 W 53rd Avenue $579,000

3501 W 53rd Avenue Denver, Colorado

4 Beds 2 Baths 2,599 Sq Ft 0.170 Acres

Sale Type: Active Listing courtesy of Coldwell Banker Mountain Properties

1891 S Julian Street $585,000

1891 S Julian Street Denver, Colorado

5 Beds 3 Baths 2,167 Sq Ft 0.170 Acres

Sale Type: Active Listing courtesy of Re/Max Urban Properties

2711 S Sherman Street $595,000

2711 S Sherman Street Englewood, Colorado

3 Beds 2 Baths 1,956 Sq Ft 0.150 Acres

Sale Type: Active Listing courtesy of MB Rick Watkins Inc

2290 S Vallejo Street $595,900

2290 S Vallejo Street Englewood, Colorado

4 Beds 3 Baths 2,400 Sq Ft 0.110 Acres

Sale Type: Active Listing courtesy of Equity Colorado Real Estate

935 S Sheridan Boulevard $599,900

935 S Sheridan Boulevard Lakewood, Colorado

4 Beds 2 Baths 1,855 Sq Ft 0.600 Acres

Sale Type: Active Listing courtesy of Colorado Home Realty

1670 S Columbine Street $600,000

1670 S Columbine Street Denver, Colorado

3 Beds 2 Baths 1,259 Sq Ft 0.030 Acres

Sale Type: Active Listing courtesy of Keller Williams DTC

5110 Osceola Street $605,000

5110 Osceola Street Denver, Colorado

3 Beds 2 Baths 1,339 Sq Ft 0.230 Acres

Sale Type: Active Listing courtesy of Rocky Mountain R.E. Advisors

1581 S Flamingo Way $615,000

1581 S Flamingo Way Denver, Colorado

5 Beds 3 Baths 2,789 Sq Ft 0.160 Acres

Sale Type: Active Listing courtesy of Brokers Guild Homes

5130 Tennyson Street $622,000

5130 Tennyson Street Denver, Colorado

2 Beds 3 Baths 1,214 Sq Ft 0.140 Acres

Sale Type: Active Listing courtesy of West and Main Homes Inc

1195 S Cook Street $625,000

1195 S Cook Street Denver, Colorado

2 Beds 2 Baths 1,742 Sq Ft 0.140 Acres

Sale Type: Active Listing courtesy of The Cutting Edge

737 Kalamath Street $625,000

737 Kalamath Street Denver, Colorado

3 Beds 2 Baths 1,826 Sq Ft 0.090 Acres

Sale Type: Active Listing courtesy of TRELORA Colorado

1632 S Steele Street $625,000

1632 S Steele Street Denver, Colorado

4 Beds 2 Baths 1,880 Sq Ft 0.150 Acres

Sale Type: Active Listing courtesy of HomeSmart

2995 Birch Street $625,000

2995 Birch Street Denver, Colorado

3 Beds 2 Baths 2,121 Sq Ft 0.150 Acres

Sale Type: Active Listing courtesy of Slate Real Estate Advisors LLC

2837 W 36th Avenue $635,000

2837 W 36th Avenue Denver, Colorado

2 Beds 3 Baths 1,568 Sq Ft 0.070 Acres

Sale Type: Active Listing courtesy of eXp Realty, LLC

3197 S Emerson Street $649,000

3197 S Emerson Street Englewood, Colorado

3 Beds 2 Baths 2,251 Sq Ft 0.150 Acres

Sale Type: Active Listing courtesy of Redfin Corporation

6585 E Nevada Place $649,900

6585 E Nevada Place Denver, Colorado

4 Beds 3 Baths 3,195 Sq Ft 0.210 Acres

Sale Type: Active Listing courtesy of West and Main Homes Inc

3857 Eliot Street $650,000

3857 Eliot Street Denver, Colorado

3 Beds 2 Baths 1,959 Sq Ft 0.140 Acres

Sale Type: Active Listing courtesy of HomeSmart

3051 S Ogden Street $650,000

3051 S Ogden Street Englewood, Colorado

3 Beds 2 Baths 1,627 Sq Ft 0.150 Acres

Sale Type: Active Listing courtesy of Hart Realty Group

2026 S Lafayette Street $650,000

2026 S Lafayette Street Denver, Colorado

3 Beds 2 Baths 2,176 Sq Ft 0.140 Acres

Sale Type: Active Listing courtesy of eXp Realty, LLC

5112 Tennyson Street $650,000

5112 Tennyson Street Denver, Colorado

4 Beds 3 Baths 2,667 Sq Ft 0.140 Acres

Sale Type: Active Listing courtesy of West and Main Homes Inc

1600 S Dahlia Street $650,000

1600 S Dahlia Street Denver, Colorado

4 Beds 2 Baths 2,208 Sq Ft 0.280 Acres

Sale Type: Active Listing courtesy of LIVE URBAN REAL ESTATE

5301 E 23rd Avenue $675,000

5301 E 23rd Avenue Denver, Colorado

3 Beds 2 Baths 2,470 Sq Ft 0.110 Acres

Sale Type: Active Listing courtesy of Brokers Guild Real Estate

3065 Clermont Street $679,500

3065 Clermont Street Denver, Colorado

4 Beds 2 Baths 2,068 Sq Ft 0.140 Acres

Sale Type: Active Listing courtesy of Apex Real Estate Solutions Llc

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