“Insane” housing market: More metro Denver buyers willing to pay whatever it takes to get a contract

Metro Denver’s housing market has run hot for nearly a decade now, so nobody would blame it for taking a breather, especially a year into a pandemic. Instead, the frenzied pace has only sped up, shattering all kinds of records, including how much buyers are willing to pay above a seller’s asking price.

Gina Roth, an agent with the New Era Group at Your Castle Real Estate in Denver, experienced just how heated things are getting earlier this month on a listing for a Lakewood home. The property generated 74 showings in under four days and snagged 15 serious offers from buyers, all above the list price of $590,000.

How desperate were buyers? The winning bid came in at $687,000, a premium of $97,000 or 16% above a carefully considered offering price.

“$30,000 over the list price used to be fantastic,” Roth said. “Now it won’t get it done.”

Normally, it is not a given that sellers will even get the asking price. A more typical pattern is that sellers do the best they can to get the initial price right and then come down a bit in price to close a deal, said Steve Danyliw, a member of the Denver Metro Association of Realtors Market Trends Committee and local real estate agent.

“If the market is on the uptick, we can see that number in the 98% and 99% range. If things are going good, we will see 100% or just above it,” he said.

But in March, sellers in metro Denver received, on average, 104.1% of the list price, a new record.

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And unlike 2017, during another heated period of activity, it isn’t just homes in the lower price ranges that are getting bid up. Now it is the entire spectrum, including $1 million-plus properties, where sellers hold the upper hand.

“This is as insane a market as we have ever had,” said Lon Welsh, founder of Your Castle Real Estate in Denver. To help agents understand what is going on, his firm compiled a heat map of metro Denver showing what share of sales in the first quarter went for above the asking price.

Of the 13,807 sales in the first quarter examined, 56% sold for above the list price and another 18% at list price. Of the 935 neighborhoods tracked, 158 or 17% had every listing go for above the asking price. Another 150 had between 75% to 99% of homes sell above the initial price.

RELATED: See Metro Denver housing market activity by ZIP code and neighborhood

Granted, many of those areas only had a listing or two come onto the market. But in the Seven Hills neighborhood in Aurora, all 17 listings went for above the list price, selling for an average of $401,000. And in Lakewood’s Friendly Hills West neighborhood, all 13 listings that closed went for above the initial asking price. The average closing price there was $475,000.

In Thornton’s Northhaven neighborhood, which had 53 sales in the first quarter, nearly nine out of 10 sales closed above the list price. Other locations …read more

Source:: The Denver Post – Business

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