Despite having plenty of homes on the market in metro Denver, home sellers and their real estate agents are holding tight to their price expectations, failing to gain the attention of homebuyers, realtor analysts are saying after reviewing the latest numbers.

The median-priced detached home in metropolitan Denver was $649,000 last month, off only a fraction of a percent from July’s median price, according to the latest Metro Real Estate Market Trends Report issued by the Denver Metro Association of Realtors.

A median priced condo or townhouse came in at $385,000, off 1.28% from the month before. Median prices have only slid marginally from a year ago, according to the report: down 0.38% for a detached home, and a little more than 3% for an attached home.

Those relatively steady prices defy an economics basic, that when supply goes up, prices come down. However, the number of listings for sale in the 11-county metro area stood at over 13,000 homes last month, up around 22% from a year ago. Yet prices of homes that sold are off less than a half percent from a year back.

Surprising inventory

Veteran agents are remarking how much the supply has increased since the days coming out of the pandemic, when listings flew off the shelf, often backed up by competing bids.

“You figure that at the peak of the boom three years ago, there were only around 1,200 homes on the market, severely limiting buyer’s opportunities,” Sotheby’s International broker Deviree Vallejo told The Gazette.

“It’s easy to understand how almost every listing received multiple offers even after one weekend on the market,” Vallejo added.

Despite a lowering trend in mortgage rates and some expectations that the Federal Reserve could cut the federal funds rate, DMAR’s Market Trends Committee was less than optimistic that sales in the near term would improve much.

“There is little expectation for the market to change as we round out the year,” said Coldwell Banker agent Amanda Snitker, who chairs the committee, in the report.

“Factors such as unemployment, inflation and tariffs may ultimately undermine the intended benefits of any rate cut,” Snitker added. “While the median closed prices have stayed relatively stable, sellers continue to push against buyers’ price tolerance.”

Realistic or unrealistic

Meanwhile, the newest numbers reinforce a trend noticed over recent months — a divide between homes that come on the market with realistic prices and that sell promptly, and those that linger despite price reductions.

“Homes priced appropriately are selling with little or no reduction, while overpricing often leads to extended days on the market and steeper price adjustments,” Snitker said.

National analysts are marking the same lackluster sales, according to numbers released last week by the National Association of Realtors NAR noted that pending sales were off month-over-month in the Northeast and Midwest, were flat in the South, and rose in the West. Just 16% of agents nationally are expressing confidence that buyer traffic will grow coming into the end of the year, according to that report.

“Even with modest improvements in mortgage rates, housing affordability, and inventory, buyers still remain hesitant,” NAR Chief Economist Lawrence Yun reported.

Rike Palese, who heads up Re/Max Professionals’ top-selling DTC office with 178 agents, says that anticipation of a rate cut may already be baked into the mortgage market’s current rates, making a positive shift less likely.

Wait-and-see

“The market is in a wait-and-see state,” Palese told The Denver Gazette. “The media speculation on potentially reducing rates unfortunately gets people to sit on the sidelines.”

Palese added that he is surprised that pricing numbers aren’t yet reflecting significant drops, despite reductions that many sellers have made. “There are $50 thousand or $100 thousand reductions happening at all levels now,” he said.

DMAR Trends committee member Andrew Abrams, who reports on the million-dollar-and-up range, noted that properties are continuing to sell, despite sellers’ frustrations.

“Essentially, properties are being listed higher, negotiated down, but (are) still selling for more on average than in the past two years,” Abrams said.

Million-dollar buyers

“Denver Metro has seen more $1 million buyers than in the previous two years,” he continued. “While these buyers are taking longer to make decisions and negotiating more aggressively, average prices have held steady.”

Over the course of August, a detached home sold for $9.75 million after a little more than a month on the market, and an attached property sold for $3.85 million after a little more than two months.

“At the high end, many sales are cash transactions, so they’re less impacted by rates,” said Re/Max’s Rike Palese. “Those buyers have accumulated huge amounts of wealth, and they’re buying what they want to buy.”

Softening conditions

In the lower and mid-ranges, buyers are struggling to find affordable opportunities.

Heather O’Leary with eXp Realty, who covers the Trends reporting for the mid-range, $750,000 to $1 million, noted that sales in that range were down more than 7% from the previous month, but that pending sales were up, suggesting that buyers may be responding to the softening conditions.

Year-to-date trends also suggested significant differences between detached and attached properties, O’Leary reported. Sales of single-family homes in the range were up almost 2% over the year, while attached home sales had declined 16% year-to-date.

Compass agent Greg Cox, reporting for the committee on the market’s lower end, said that cooling sales were typical for late summer, but still reflected a downward trend.

Looking for opportunities

“Many buyers are still walking away from contracts, not necessarily leaving the market but holding out for a deal that feels right,” Cox added.

Meanwhile, he added, many attached sellers appear to be waiting for better market conditions.

Re/Max’s Palese says that buyers should be looking for opportunities now. “Sellers are being more cognizant of pricing, they’re offering concessions, and they’re not casting buyers aside when asking for inspection items.

“The reality is that this is best opportunity to buy in last three years,” Palese said.