Editor’s note: the following is an excerpt from the April 2014 issue of the Foreclosure News report, an award-winning newsletter published by RealtyTrac. Get a free issue here.
Median home prices in the greater Denver metro area have increased on an annual basis for 24 consecutive months as of February, up 31 percent from the bottom in February 2009, according to RealtyTrac data.
Furthermore, Denver home prices over the past year have exceeded their previous peak of August 2006. While home prices are rebounding in many markets across the country, most other states are still not back to the home price highs of the middle 2010s.
“The pricing has gone up. There are competitive bids on almost every transaction. I am exceeding the list price within the first few days,” said Tom Guest, broker/owner at Key Masters Real Estate, covering the Denver metro market. “If a property goes on the market you can almost guarantee it will go for full price or higher.”
17 showings, eight offers, one day on the market
Guest provided one recent example of a Denver home his company listed for sale in late March. Priced at $229,000, it was on the market for one day, and in that one day there were 17 showings and eight offers submitted. The winning offer was all cash for $235,000, and the deal closed in seven days.
“When we’re competing with other transactions we do see a lot of cash buyers,” said Guest, who said he has been working the Denver real estate market for more than 20 years.
Other agents along the Colorado Front Range, spanning from Boulder north of Denver to Colorado Springs south of Denver, provided similar tales of multiple bids and offers coming in over asking price.
“We’re in multiple-offer situations here, a lot of times. If a house is in really nice shape … they are not staying on the market,” said Frank Gillen, associate broker with Metro Denver Home Store who covers mostly south of Interstate 70 in the Denver metro area.
Gillen said a recent listing of his was put on the market on a Thursday with an open house on Saturday and an offer accepted on Monday.
“It was on the market for five days and there was more than one offer,” he noted. “There are so many buyers out there looking at a home.”
Gillen said the market has been on a tear since last year, with strong demand forcing many of the buyers he worked with “to come in five to ten thousand dollars above asking price to get (their offer) accepted.”
Chad Ochsner, owner and broker of record for RE/MAX Alliance brokerage in Denver, noted that while a competitive marketplace is good problem to have, it does still represent a challenge — particularly for buyers.
“We have very frustrated buyers who are ready, willing and able to buy. We’re seeing multiple offers, bidding wars,” he said, telling the story of one of the brokerage’s agents who had been working with one of these ready, willing and able buyers for several months when the buyer finally gave up on purchasing a home in Denver and decided to move instead to Houston for an opportunity there.