A slight October chill descended on metro Denver’s housing market: Home sales remain seasonally strong, but single-family home prices stayed flat and condo prices fell, according to statistics released Tuesday.
The median sales price of a single-family home was $250,000 in October, the same level as reported in September and down from August’s record of $255,000. Median condo prices dropped 4.3 percent during the month to $157,904, down from $165,000 in September.
Yet the number of homes sold so far this year, 45,016, is only a tad below last year’s volume of 45,397.
“Sellers are having to make more concessions, having to adjust their prices downward,” said Steve McGuire with Re/Max Professionals in Highlands Ranch. “Maybe we are seeing a little bit of a trend.”
Consumer confidence, or the lack of it, could be behind a softer housing market, McGuire said.
Consumer confidence fell 2.5 points in October to 85, suffering the largest two-month decline since October 2003. Expectations for the future are at their lowest reading since March 2003, when the Iraq war started.
Median metro house and condo prices trod water in the months leading up to the Iraq war before moving higher again.
Consumers pinched by higher gasoline and home-heating costs might be less inclined to buy a new home or upgrade, McGuire said. Higher mortgage rates, although not up dramatically, may also be pricing some entry-level buyers out of the market.
Both McGuire and independent analyst Gary Bauer said the low end of the market this year seems to be softer than the high end, which suffered more as the metro area lost high-paying tech and telecom jobs between 2001 and 2003.
Builders shifted to more affordable homes, but now that market segment appears to have softened, with many low-priced homes taking longer than the market average of 89 days to sell.
A buyer who bought a metro area condo at the median price in September 2003 and sold at the median in October 2005 would have made only $900 – actually a loss after paying real estate commissions.
But Bauer doesn’t see the flat market as a harbinger of a big move down in prices in the months ahead.
“It was one of those comfortable, no-record months,” Bauer said. “I’m confident we are not on the downside of a peak.”
Staff writer Aldo Svaldi can be reached at 303-820-1410 or asvaldi@denverpost.com.
