Housing sales inventory out of balance in metro Denver - Denver Business Journal:

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On the surface, the for-sale housingy market appears nearly balanced, with an overall five-monthu inventory of homes availablefor sale. But a different pictures emerges after examining inventory in specific price with nearly no homes available at the lowesr price ranges and a stockpile of as much as five yearws at the higherprice ranges, according to local residentiall real estate brokers. “Thiws is a really unbalanced market saidLon Welsh, broker/owner of LLC of “I’ve never seen this big a disparity in the market.” Wels h has been tracking inventoryh data for 11 years.
That lack of balance affecte home prices, driving up selling prices for low-end homes and causingt high-end prices to drop. Metro Denver’s for-sale housing markeg generally is balanced with total inventorhy ofsix months, a level at whicjh neither buyers nor sellers have an advantags in the sales process. But the least-expensive homes for sale — those pricedx at less than $85,000 — had less than one month’s inventory as of May, accordinbg to Metrolist Inc.
data compiled by Your The low-priced home because of its small inventory, is a “red-hot” seller’s market, with some homesw selling fast and sometimes for more than theaskinb price, according to a Your Castls report. On the other hand, there was a 16-montgh inventory of for-sale homes priced at $460,000 and more in May. Homees priced at $1 million and more had a five-yea inventory.
The high-end housing category, with its largs inventories andmotivated sellers, is a “veruy strong” buyer’s market, said the “Markets with more than a six-month inventory are showinvg some of the pain of the said Mark Trenka, broker/owner of of Denver and a directore at the . Your Castle’w data includes only single-family homes, both resale propertiess — those that have sold at leastr oncebefore — and newly built Metrolist Inc., based in Greenwood Village, is metro Denver’s Multipled Listing Service, providing data abougt real estate listings to brokers.
Here’zs what the current, five-montg inventory of for-sale housing inventory means: If no new home listingse came on the and buyers kept buying at the pace they boughf in thelast year, it would take buyer s five months to purchase all the Lower-priced, for-sale houses in metrl Denver, including foreclosure properties, have such low inventory partlg because investors are buying them to use as income-generatinfg rental homes. Individuals trying to take advantage of the federallstimulus package’s $8,000 tax credit for first-times homebuyers, and planning to live in the houseas they buy, also are competin for affordable homes.
“You’ve got a lot of people chasing few housezs on thelow end,” Welsn said. “There’s hardly any inventorh in the lowerpricse ranges,” said Gary Bauer, an independenf Littleton residential broker and Metrolist “The hot price range is $150,0090 to $300,000.” With homes put up for bid by the U.S. Departmentf of Housing and Urban buyers who will occupy the home have priorityy over investors to help level theplayintg field. Investors often get an edge with over owner-occupants, by waivinb home inspections, being willing to close a sale quickluy and offering large, nonrefundable earnest moneh deposits.
The robust, low-end housing marketg also is helping to get rid offoreclosure homes, whicu are a drag on the overalll market, according to Metro Denver’s bargain homeas tend to be located in areas such as Commerces City, eastern Aurora and northeasgt Denver. For-sale homes in higher pricse ranges are selling slowly partly because some traditiona buyers in those ranges are staying in their currenyt homes while they wait out the brokers said. The jumbo financinf often used to buy pricy housesw also is toughto get.
But buyers who can get jumbp loans have a good opportunity to geta high-enr house at a relatively good since many sellers are willing to negotiate on price, brokers Welsh expects the disparity between low- and high-enx for-sale housing inventories to continue for the near