The latest predictions for the Denver, Colorado real estate market suggest that home prices could rise more slowly in 2018 than they did during 2017. But don’t let that outlook fool you. It’s still a highly competitive market with limited inventory.
Here are the latest trends and predictions for the Denver housing market in 2018.
Denver Housing Market Predictions and Trends, 2018
Thinking about buying a home in Denver in 2018? If so, you might want to start your search early to allow plenty of time. Housing inventory is very tight right now. This is true across the entire metro area, but particularly within the city itself. And recent predictions from real estate analysts suggest that the Denver housing market will remain tight throughout 2018.
Consider the latest numbers. A healthy and “balanced” real estate market has a five- to six-month supply of homes, according to economists. As of December 2017, Denver had just under a one-month supply. That’s a tight housing market, and it’s making things competitive for home buyers who are seeking a property. Competition is highest at the lower end of the pricing spectrum, including “starter homes” favored by first-time buyers.
In January 2018, Zillow published a report detailing the tight inventory conditions across the country. According to that report, the number of homes for sale in Denver, Colorado has declined by nearly 26% over the last year or so. By comparison, housing inventory nationwide dropped by 10% during that same 12-month period.
Are Home Prices Cooling?
You would think that home prices would still be skyrocketing in Denver, due to very tight supply situation. That’s usually what happens when demand far exceeds the available supply. But recent insight and predictions from analysts suggest that the Denver housing market might be cooling down a bit — from a pricing perspective anyway.
According to Zillow, the median home value for the city rose by 6.7% over the past year (as reported in January 2018). But their prediction for the next 12 months called for a gain of only 2.9%.
Patty Silverstein, chief economist with Development Research Partners in Littleton, Colorado, recently stated: “Our expectation is that 2018 may indeed be the year that home prices in metro Denver increase at about the same 5 percentish rate as the nation.”
So while the inventory situation is still abnormal within the local housing market, annual price growth might be slowing to a more normal pace.
Higher Loan Limits in 2018
Some good news for buyers is that loan limits have been increased in Denver, in response to the home-price gains that have occurred over the last year.
We blogged about the new FHA limits just yesterday. Maximum loan sizes were also increased for VA and conforming conventional mortgages. These changes will give Denver-area home buyers more financing “room” to work with.
Note: Borrowers with sufficient income and good credit can obtain financing above these limits, as long as their income supports it. This is what’s referred to as a jumbo mortgage loan.
Disclaimer: This article includes predictions for the Denver housing market in 2018. These projections were offered by third parties not associated with our company. We have presented them here as an educational service to our readers.