List Price Just the Starting Point in Housing Markets Frenzied Madness of March
ENGLEWOOD, CO – April 12, 2021 – Approximately 60% of Colorado homes sold during the month of March received more than the original asking price as the frenzied buying market continues statewide, according to the latest research from the Colorado Association of REALTORS® (CAR) and the National Association of REALTORS®. Together with California, Colorado topped the madness of March list of just a handful of states where sale prices exceeded asking price by more than 50 percent.
Throughout the state, demand remains so strong that, despite a slight bump in new seasonal listings, buyers are simply viewing list price as the starting point for a bidding war that often includes waiving contingencies centered around appraisals and inspections and making sight unseen, cash offers well above the seller’s asking price. “In short…the challenge for homebuyers is like playing a game of musical chairs. Except in this game, there are 132 players, only 2 chairs, and one of the chairs was just sold before the music stopped playing,” said Fort Collins-area REALTOR® Chris Hardy.
The market trends, which began in the typically slow winter months, have now reached a fourth straight month of unprecedented buyer behavior as we enter the early spring housing season and watch record after record be shattered. “It is a market that we have never seen,” said Colorado Springs REALTOR® Patrick Muldoon. “…real estate is HOT, sellers are happy, buyers remain sad.”
In some local markets, increases in median sales prices typically seen over the course of a decade have been matched in just the past year. In the seven-county Denver-metro area, the inventory of active listings is down 78% from a year ago while the median price of a single-family home has risen 11% since the beginning of the year and 15.6% since last March to a record $540,000. Looking statewide, active listings are down more than 70% year-over-year, while single-family median pricing rose nearly 9% since January and is up 14.4% from March 2020 to a record $485,000, all new record lows and highs, respectively.
Also shattering records in the Denver-metro area and statewide is the overall inventory supply which, at just a few weeks, is well shy of the six-month supply considered to be a balanced market and a volume that Colorado has not seen since 2012.
Mountain and rural communities are also feeling the same pressures – low inventory, rising median pricing, fierce competition, and fatigued buyers. “COVID has altered the way people live and work in ways we did not foresee. These changes have made mountain retreat properties even more desirable than they were before,” said Summit-area REALTOR® Dana Cottrell.
In the face of lingering market challenges, land seems to be the new frontier in Colorado, with land sales continuing to escalate in many areas of the state. “In 2020, 24 vacant parcels sold for a total of $5 million. January – March 2021 had 103 vacant parcels sell for over $40 million. And this is when everything was covered in feet of snow. Land that has been for sale for years has finally sold and it is tough to find something to buy in certain areas, said Crested Butte and Gunnison Valley-area REALTOR® Molly Eldridge.”
METRO DENVER REPORT
STATEWIDE REPORT
Taking a look at some of the state’s local market conditions, Colorado Association of REALTORS® market trends spokespersons provided the following assessments:
AURORA
“While we typically enjoy watching the flowers and number of houses for sale start to rise each spring, sadly, the latter of those two annual events just isn’t the case in 2021. Listings are down in Aurora, Centennial and Adams County 73% – 85% depending on the location. In March 2020, Arapahoe County had a total of 866 listings, the same time this year, we found only 185 active listings. With extremely low inventory, it stands to reason that prices are up about 15% year over year. The median price in Arapahoe County is now $522,000. Condos in Arapahoe County are also experiencing the same drop in inventory however, prices are up 7% over March 2020 to a median price of $300,000.
“Adams County shows the same lack of inventory, with active listings down 85% and home prices up 12.3% to a median sales price of $455,000. The condo market, showing numbers similar to Arapahoe County, has inventory down 84% and median prices up 12% to $320,000 for March 2021.
“The City of Aurora had 104 available single-family homes for sale in the month of March, down 81% compared to March 2020. The median price for all areas of Aurora is $467,000.00, keeping Aurora as one of the more affordable options in the Denver-metro area. The condo inventory also fell 84% compared to a year prior pushing the median price up 6% year over year to $278,000.
“Our springtime may be bursting with flowers, but we do not see that happening for residential real estate listings. Yes, it’s important to take some time to smell the flowers, but don’t take any extra time in the search for your perfect home,” said Aurora-area REALTOR® Sunny Banka.
BOULDER/BROOMFIELD
“Is it ever going to end?
Even though it’s only been four months since our market has really taken off,
buyers, sellers and REALTORS® continue to ask the question. The extreme
low inventory and inflated prices do not equate to a sustainable, healthy
market and yet, it seems to be continuing into the spring with no end in sight.
“Boulder County has 26% fewer listings than this time last year when we were in a lockdown, so that decreased number is even more significant. Prices are soaring with an increase of 19.9% since January. Most single-family homes experience a multiple offer situation with buyers needing to compensate for lower appraisals to win the property.
“Broomfield County is experiencing more of the same. With 19% fewer listings in both single-family and attached homes, prices have increased 15% since January for houses and a whopping 21% for attached properties. The steady stream of people moving here (especially from California) has peaked the demand to near-record levels.
“And then, there is the condo market in Boulder. It’s the only segment of this market that is not experiencing the same appreciation and demand. With a very modest increase in prices of 2.4% since January and an average of 60 days on the market, this particular category is not faring nearly as well as its single-family neighbors. It may be the perceived density of condo living, or perhaps fewer student residents but whatever the reason, this part of our market is not performing like the rest of the front range,” said Boulder/Broomfield-area REALTOR® Kelly Moye.
COLORADO SPRINGS/PIKES PEAK AREA
“Supply and demand are the typical eb and flow of the pricing of most products. With high demand and low supply comes a push up on prices. In the world of real estate, we are experiencing a 63% drop in available properties in our area from last year which has equated to a push up of prices by 16.7%. Literally you could have purchased a home last year and probably outperformed most people’s retirement accounts even if you never lived in the home. In past markets we would have seen builders alleviating this issue, but we have a massive issue with inventory shortages, material price increases, and high demand there as well. In the past, a builder may have a deal fall out of contract and would then place the home back on the market at the last list price, but in the new world of real estate, even the builders are taking advantage of low inventory and are running highest and best, or lotto approaches to get homes sold. It is a market that we have never seen.
“On the other side of the spectrum, the FED continues to keep interest rates low, printing trillions of dollars which did push inflation up a bit this week. Add in another month of hundreds of thousands of jobs lost, and we continue to see a failing economy and a booming housing market. With the foreclosure and eviction moratorium still out at June 30, we have no real data to base housing stats against or even delinquent loan numbers. But I would expect to see some interesting plays by the government after the CFPB paper hit showing that accumulated missed housing payments from COVID could just be tacked on to the end of an owner’s loan and it appears we may also get a 40-year mortgage option. Look for institutional investors to keep buying real estate for rentals which is adding to the shortage issue.
“I do not see the real estate market losing any steam for quite some time since the inventory shortages will see no reprieve. One thing that could slow the economy quickly would be a rapid rise in interest rates if the FED loses control of the yield curve, but they will do everything in their power for controlling that as well. So, until our next meeting…real estate is HOT, sellers are happy, buyers remain sad,” said Colorado Springs-area REALTOR® Patrick Muldoon.
CRESTED BUTTE/GUNNISON VALLEY
“The first quarter of 2021 was quite astounding in the Crested Butte and Gunnison area. It was by far the busiest ever with more than $191 million in sales through 264 transactions. When you compare those numbers to 2020, which was an average year, with $65 million and 120 transactions, it is no wonder we’re all just holding on tight.
“The market has had a nice, steady appreciation for the last 10 years, but prices have increased substantially in the last year. The average price of single-family homes is 27% higher than this time last year while condo & townhome prices have gone up 23%. The average price for a single-family home this quarter for the entire Gunnison Valley was $960,515 and the average for condos & townhomes was $526,961. Currently, the area around Crested Butte has zero, not one single-family home for sale for less than $1 million and only two under $1.5 million. Even Gunnison, which is traditionally more affordable, has only one home for under $500,000 and only 6 under $1 million. Residential inventory is down 40% compared to the same time last year and what is on the market, is priced significantly higher than last year.
“Unlike many ski towns, Crested Butte and the Gunnison Valley have a lot of vacant land. People who want to own their piece of paradise are buying land and planning for a future home. The numbers are truly remarkable for the first quarter. In 2020, 24 vacant parcels sold for a total of $5 million. January – March 2021 had 103 vacant parcels sell for over $40 million. And this is when everything was covered in feet of snow. Land that has been for sale for years has finally sold and it is tough to find something to buy in certain areas. I would anticipate more lots coming on the market this summer once the snow has melted and owners, who have been waiting for the market to pick up, realize this is a good time to sell.
“There are so many questions and conversations happening about what is coming next. Will buyers continue to see value in the area even at these new, high prices? Will sellers be reasonable in pricing their properties at just above recent sales, or will they shoot for the moon? I believe there are property owners who have been waiting for the right time to sell and now could be that time. We don’t know what the future holds, but at the moment, a well-priced property of any type will sell quickly,” said Crested Butte-area REALTOR® Molly Eldridge.
DENVER COUNTY
“Most multi-sibling families wonder how two people with near, if not identical DNA can have such different personality traits. One could be wild and outgoing, loud and rowdy all while being a ‘B- student’ at best. The other; quiet, reserved and devastated by anything other than an ‘A’ in school, coexist though in very different mindsets.
“This wild and unpredictable disparity is very similar to what is happening to the two prominent sectors of the residential real estate market in Denver. With this being the first COVID-to-COVID comparison year-over-year, we have seen staggering growth in the freestanding home sector while the condo market has fallen far short of its wild and rambunctious sibling. At a staggering 19.4% median price appreciation in just one year, demand for the freestanding has nearly doubled from 2019 to 2020’s growth of 11.1% and the year before that, less than 1% price growth occurred. By comparison, the condo price appreciation in March 2021 was just 2.6% higher than the year before. Given the price increases that are hardly new news in Denver, the condo market in years past has held steady in growth alongside its slightly more popular sibling. For comparison’s sake, March’s 2.6% increase was a drastic decrease from 2019 to 2020’s 13.5% price appreciation, and well below the average 7.32% condo price growth over the last 5 years.
“As COVID-life veterans by now, we all can understand how demand for more space which now encompasses office life, home schooling and new demands on a home. The demand for a freestanding home does fall in line with that evolution and certainly doesn’t look to decrease anytime soon. What we can see happening in the future, however, is that with a median price growth from $527,000 to $630,000 in just one year, the ability to prefer one home type over another becomes further out of reach for many homebuyers in 2021 and beyond. The condo will certainly need to become more appealing as pricing will become an even larger factor in where people live in Denver,” said Denver-area REALTOR® Matthew Leprino.
DURANGO/LA PLATA COUNTY
“What a difference a year makes. This time last year, most of us in the real estate business thought the housing market was doomed. Boy, were we wrong. No one could have predicted that housing stock would drop by almost 75% for single-family homes and nearly 90% for condos and townhomes in an already tight market. Durango has enjoyed consistent appreciation over the last decade, but the appreciation has skyrocketed over the previous 12 months. The average single-family sales price spiked to over $735,000 in March, a 40.5% increase over this time last year. Condo prices increased by more than 28% for the same period. We currently have just over a month’s supply of available inventory of single-family homes and a staggering two weeks’ worth for condos and townhomes.
“Everyone wants to know when the frenzy is going to end. Is this the new normal for our market? Most professionals predict the market will remain in this state through the end of this year based on current demand, low interest rates, and ridiculously low inventory levels. We are seeing more sellers entering the market, but not enough to curb the demand, which far outpaces the supply.
“Buyers need to be prepared to make lightning-fast decisions when opportunities present themselves. Working with a seasoned professional that knows the market is more important than ever. Buyers need to be flexible, have cash or their financing in place, and be willing to waive certain contingencies if they want to win in this market.
“While many facets of the economy have been adversely affected by COVID, the housing market is the rare exception, seeing record gains across virtually every market nationally,” said Durango-area REALTOR® Jarrod Nixon.
ESTES PARK
“Where are all the listings for single family homes? Larimer County is seeing a hard road ahead for buyers. New listings for single-family homes are down 26.7% from March 2020, barely reaching 475, compared to 651 a year ago. Transactions are closing 10% above this time last year and the average sales price is climbing faster than the temperature. Our average sales price in March 2020 was $471,598, and today we sit at $556,229, a 17.9% increase. Our average days on market has fallen 24% from 75 days to 57. Our inventory of single-family homes has almost disappeared with a 73.5% decrease from March 2020 when we had 1016 homes on the market compared to today’s 269. The incredibly tight inventory has also driven the percent-of-list price received up to over 2% from list price. Last year, homes were fetching 99.5% of list price, this year, in March, we’re seeing 101.5% of list price with multiple offers, offers well over asking price, and offers with fewer objections to sweeten the offer to the seller.
“Townhouse/condos are attempting to fill the demand gap with a 10.1% increase in new listings. However, they are closing less than March 2020. Sold listings for Townhouse/condos have dipped 10.7% yet the average sales price has not suffered, but rather increased right along with single-family homes at 11%. Last year, the average price hit $330,236. This year, the average has climbed to $366,416 and I suspect this is only a resting place and they will continue to climb. Days on market until sale is down 42%. Days until sale was at 88 last year, and now at a short 51 days. Inventory of townhomes/condos has also been slashed -68%,” said Estes Park-area REALTOR® Abbey Pontius.
FORT COLLINS
“I saw a meme on ‘the Facebook’ yesterday that perfectly described our real estate market. In short, it aptly illustrated the challenge for homebuyers as kids playing a game of musical chairs at a birthday party. Except in this game, there are 132 players, only 2 chairs, and one of the chairs was just sold before the music stopped playing.
“The numbers from last month bear out this analogy: The Fort Collins market saw a jump in median price over the previous year by over 16%, landing at $494,500. Months supply of inventory hovers under 1 month, meaning that if nothing new came on the market for the next 4 weeks, everything on the market would be purchased in the first 21 days. Musical chairs, indeed.
“Moreover, the competitive nature of this constrained inventory market is driving sold prices well over the list price. In the Fort Collins postal delivery area, the overall list price to sale price ratio was nearly 4%. Consider the median price of $494,500. Given the competitive nature of the market, it’s likely the list price for that median price home was $477,000. Buyers are having to cough-up $20,000 or more in order to win these competitive bid situations. Anecdotally, there are plenty of stories out there where some properties are garnering in excess of $100,000 over-asking with appraisal and inspection contingencies completely waived.
“Meteorologically speaking, April is ‘the cruelest’ month. It’s cruel because you have the chance to experience (and must prepare for) all four seasons of weather at any given moment. Eighty and sunny one day, 40 and snowing the next, rainy and soggy the next. From a real estate perspective, April will likely be a cruel month because there appears to be no relief in sight for more housing inventory and the competition for those few homes available is likely to remain as fierce as kids diving for the last empty chair at that birthday party,” said Fort Collins-area REALTOR® Chris Hardy.
FREMONT/CUSTER COUNTIES
“We are on our toes, our tip toes. Although Fremont and Custer counties typically lag behind the metro areas housing behavior, we are catching up with the frenzy. Month-after-month of fewer new listings and higher priced, faster sales have depleted any sense of decent inventory and driven up pricing. It is almost too fast of a market for anyone to think, let alone sleep on it. This includes both buyers and sellers. Sellers are receiving quick multiple offers, sometimes higher than the list price. Many sellers are negotiating lease-back options so they are not homeless while they find another place to purchase. It’s like jumping out of the frying pan and into the fire, seller today and buyer tomorrow. When I bump into people in the grocery store who ask, “How’s the market?” the answer is simple, it’s crazy, just look at the numbers. Custer County median price is up 72.2% year-over-year to $425,000. New listings are down 15.6% and sales are up 28.1%. Fremont County median price is up 22.4% year-over-year at $283,964, as new listings are down 6.9% and sales rose 39.3%. There is less than one month’s worth of inventory on the market,” said Fremont and Custer County-area REALTOR® David Madone.
GOLDEN/ARVADA – JEFFERSON COUNTY
“The record low inventory across Jefferson County continues pushing buyers to new levels of frustration in one of the most aggressive housing markets we have seen in a long time and there is no end in sight. For single- family homes, the median sales price rose once again in March to $600,000 as properties were on the market an average of 12 days. For condo/townhomes, the median sales price hit $340,000 with those properties on the market just 16 days.
“Thankful buyers are covering the difference from sale price to appraisal with cash at closing, and there are plenty of pure cash buyers winning the offer as homes come to the market at the end of the week and are under contract by Monday,” said Golden/Jefferson County-area REALTOR® Barb Ecker.
GLENWOOD SPRINGS/GARFIELD COUNTY
“Normally, spring in the Roaring Fork valley brings tulips and new listings. And while the flowers are starting to bloom, REALTORS® and their buyers are still waiting for the new listings. March did see a slight increase in new listings compared to the beginning of the pandemic in 2020. The increase was so slight (a total of four single family) it did not make a dent in the extreme lack of inventory our communities are experiencing. New listings in the townhome/condo market were even more sparse with a decrease of 15%. March 2021 ended with a 62.7% decrease in active listings for all property types over last year. Pending sales of single-family homes were up 85% over last year with the townhome/condo market following close behind with pending sales up 80%. With an average months supply of 1.2 months, multiple offers, waiving contingencies and quick closings are now the norm, not the exception. Many sellers, normally happy to take advantage of this incredible yet crazy market, are staying put due to a lack of inventory for a replacement home and high cost of new construction. The months to come should be an indication of whether this market is a momentary response to people fleeing larger communities during the pandemic or if this tight market is the ‘New Norm,’” said Glenwood Springs-area REALTOR® Erin Bassett.
PUEBLO
“Pueblo County’s March housing numbers continue to tell the story of the past year, low inventory, multiple offers, prices going up, happy sellers, not so happy buyers.
“New listings for March were down 4.1% with pending sales up 19.1% and year-to-date up 7.4%. Houses are going under contract so fast, within a couple days, buyers must make quick decisions. Sold listings were down 1.9% in March simply because of low inventory. The demand for homes is reflected in the average price going up 21% in March to $269,526 and up 22% year-to-date to $262,526. Our percent of list price received is 100.8% in March and 101% year-to-date, again reflecting the high demand and low inventory. Average days-on-market fell 17.6% in March and is down 10.5% year to date. Housing permits jumped to 83 in March, the most per month in many years. Builders need more workers, lower costs for supplies, and fewer regulations,” said Pueblo-area REALTOR® David Anderson.
STEAMBOAT SPRINGS/ROUTT COUNTY
“Here in the Yampa Valley, we had our own March Madness. Buyers and their brokers sat on the edge of their seats anticipating new listings for single-family homes that dribbled on the market at an 8.3% increase, while multi-family listings dropped the ball and fell 3.9% over last year. Pending home sales shot up 173.3% with condo/townhomes competing heavily with a 172.7% increase over the same period. Both median and average sale prices surpassed the $1 million mark with single-family up 100% from the previous year; notably due to 14 sales over $2 million versus only two during the same period in 2020 and one sale at $11.5 million. Multi-family pricing fired up more than 30% over the same period of that quarter. Active listings have taken a dunk in both categories since last March, plunging 74%. On the sidelines, seller’s agents are assisting their clients to prepare their properties for the spring/summer selling market and coaching them on the potential free-throw of multiple offers. With inventory supply teetering around one month, buyers do not have a lot of time to contemplate and must quickly decide if they are going to take the offer shot or pass. Many buyers find that it may take multiple tries before getting a winning contract and it is necessary to rebound. Knowing the rules of the game and keeping the eye on the prize will ultimately result in a win for both seller and buyer,” said Steamboat Springs-area REALTOR® Marci Valicenti.
SUMMIT, PARK AND LAKE COUNTY
“I’ve heard from buyers thinking of waiting to buy until real estate is balanced or there is a market crash or major price adjustment. Things will change eventually, but who knows to what. COVID has altered the way people live and work in ways we did not foresee. These changes have made mountain retreat properties even more desirable than they were before.
“Although low inventory is the norm, when reviewing March 2021 compared to March 2020, the current active listings are more than 64% lower, the bigger story in Summit is new listings are up almost 51% and pending sales are up 156%. This means that there are more sellers, selling and more buyers are buying. Still, there are far more buyers out there as the increase in average price shows,” said Summit-area REALTOR® Dana Cottrell.
TELLURIDE
“As Yogi Berra said ‘It ain’t over till it’s over.’ First quarter sales in the Telluride market hit an all-time record at $287.67 million. The biggest areas were Mountain Village homes and vacant land in the rest of the county. Basically, that is where the most inventory exists. In the Mountain Village, a new home listed at $36 million for 18,000 square feet and is more than double any historical home sale in San Miguel County. Also, Tom Cruise’s 10,000-square -foot home on 350 acres with an asking of $39 million went under contract in just six days. A lot of that value was in the land which is only 12 minutes from downtown Telluride.
“March sales reached $121.78 million with 96 transactions. Buyer demand is still incredibly high with many properties on the market for just a few days. With COVID restrictions relaxing, there is no end in sight for demand to soften. Our volume in 2020 was double a normal year and 2021 has a good chance for us to double that production,” said Telluride-area REALTOR® George Harvey.
VAIL
“March 2021 was a pleasant change from 2020 when we shut down the ski areas and most of the supporting businesses. We continued the trend that started in July 2020 with increased sales, pending contracts, and decreasing inventory. The new listings for the month were positive 39.6% on single-family/duplex units and the condo/townhome listings increased 57.3%, which is encouraging. However, the closed sales for single- family/duplex homes was positive 103% for the month and 34% year to date. The condo/townhome sales were positive 117% for March and plus 62.6% year to date. The big difference is in pending sales for single family/duplex homes which were up 420% for March and 111.6% year to date. The condo/townhome pending was positive 369.2% in March versus March 2020 and the year to date is plus 98.6%.
“The inventory and months of supply statistics are concerning, albeit we are entering a traditional window of increasing listings. The single family/duplex inventory is negative 60.3% versus March 2020 with just 1.9 months of inventory, a record low data point. The condo/townhome inventory is off 50% versus 2020, with months supply at 2.3 which mirrors the single/family/duplex data. Days-on-market follows the inventory trends as they are negative in single-family/duplex, 37.2% for March, and condo/townhome was negative 51.6%.
“The trend by pricing niche for sales and pending continues to follow the available inventory,” said Vail-area REALTOR® Mike Budd.
Median Sales Price – Seven-County Denver Metro Area
Median Sales Price – Statewide
Inventory of Active Listings – Seven-County Denver Metro
Inventory of Active Listings – Statewide
The Colorado Association of REALTORS® Monthly Market Statistical Reports are prepared by Showing Time, a leading showing software and market stats service provider to the residential real estate industry and are based upon data provided by Multiple Listing Services (MLS) in Colorado. The March 2021 reports represent all MLS-listed residential real estate transactions in the state. The metrics do not include “For Sale by Owner” transactions or all new construction. CAR’s Housing Affordability Index, a measure of how affordable a region’s housing is to its consumers, is based on interest rates, median sales prices and median income by county.
The complete reports cited in this press release, as well as county reports are available online at: https://coloradorealtors.com/market-trends/
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CAR/SHOWING TIME RESEARCH METHODOLOGY
The Colorado Association of REALTORS® (CAR) Monthly Market Statistical Reports are prepared by Showing Time, a Minneapolis-based real estate technology company, and are based on data provided by Multiple Listing Services (MLS) in Colorado. These reports represent all MLS-listed residential real estate transactions in the state. The metrics do not include “For Sale by Owner” transactions or all new construction. Showing Time uses its extensive resources and experience to scrub and validate the data before producing these reports.
The benefits of using MLS data (rather than Assessor Data or other sources) are:
- Accuracy and Timeliness – MLS data are managed and monitored carefully.
- Richness – MLS data can be segmented
- Comprehensiveness – No sampling is involved; all transactions are included.
- Oversight and Governance – MLS providers are accountable for the integrity of their systems.
- Trends and changes are reliable due to the large number of records used in each report.
- Late entries and status changes are accounted for as the historic record is updated each quarter.
The Colorado Association of REALTORS® is the state’s largest real estate trade association representing more than 27,500 members statewide. The association supports private property rights, equal housing opportunities and is the “Voice of Real Estate” in Colorado. For more information, visit https://coloradorealtors.com.