September was an interesting month in Denver metro real estate.  After two plus years of breakneck real estate sales, Denver real estate is starting to moderate.  What was in the September data?  What does this mean for the future of Denver real estate?  Will prices continue to appreciate as they have the past two years?  Is the sky in Denver real estate falling?


What was in the Denver metro September real estate data?


The Denver Metro Association of Realtors monthly publishes a market trends report with statistics and commentary on the Denver Metro Market.  The past several years the reports have basically been a nonevent with inventory remaining low and prices skyrocketing.  September has been an eye opener as the first month  with a substantial change in the market. Here are some highlights from Septembers Denver real estate report:


  • Active listings: increased 10.86%
  • Closed Homes: decrease of 12.81%
  • Median sales price (SFRs): down .86% (still up 12.75% for the year)
  • Average sales price: Declined from a peak of 725k to 688 in September (~ 5% decline)
  • Days in MLS: increase of 30%


What caused the drop in sales and median price?


I’m not surprised that we are starting to see a bit of a slow down in Denver real estate.  I’ve been saying this for the last year that the market was getting a bit ahead of itself.  What caused the recent slowdown in sales?


  1. Seasonality: This is the first year in a few years that we are seeing normal seasonality in sales. Historically September through December are slower times with sales increasing in the  Spring through the summer.  The normal seasonality cycles were eliminated during Covid, but the recent data shows that seasonality is back as the market begins to normalize
  2. Denver has gotten expensive: The median home price hit a peak around 600k, with the median home price down to 575k in September.  The Average sales price peaked around 725k with September coming in at 688.  As prices increase less buyers are able to afford properties as wages are not increasing as fast as prices
  3. Interest rates: Interest rates have been starting to slightly move higher the last 3 weeks or so which has caused affordability to decline.  Although interest rates are not a primary driver of the declines, if they go much higher they will be

Should you be worried about Denver real estate?  Where do prices go from here?


On the surface, the numbers above look startling, but remember Denver prices have increased almost 40% in many neighborhoods over the last two or three years.  In 2018 the average sales price in Denver was $523,000 fast forward to 2021 the average price is now 725k.  Also remember that the average sales price can be skewed by a few very large transactions; the median sales price has less “noise” as it is not skewed by the extremes.


Unfortunately, with the huge appreciation Denver has seen over the last several years, it is inevitable to see a slow down in real estate.  The huge appreciation has led to Denver becoming unaffordable to many buyers.  Assuming the average sales price, a traditional buyer would need to put down over 150k (20%) for a traditional loan.  The prices in Denver are one of the key drivers of the slow down we are now seeing in Denver.  Along with the high prices, interest rates are starting to increase which is further decreasing the affordability for many.


One of the largest drivers of this huge increase was the “covid Craze” where people desired open spaces, less dense cities, more quality of life, etc.. Denver fit the bill and continues to fit the bill for many.  Although Denver remains highly desired as a livable city, the prices have increased more than the market can absorb.


Although prices have increased, Denver remains a desirable destination for businesses and residents and will continue to be a desirable for the foreseeable future.  This demand should temper any substantial downward pricing pressures.  Denver’s median price could decline, 5-10% but I don’t think we have a 2008 repeat on our hands.  I’ve seen several reports that are predicting basically flat prices for the next year or so which could also occur



The September numbers should be a wakeup call to real estate owners/investors in Denver and throughout Colorado that prices will moderate.  We are somewhere near a peak in real estate values for this cycle which only leaves two options on the table: slight decline in prices or best case basically flat values.  I don’t see a scenario with much more upside in prices for the foreseeable future.


Although it is not good to talk about possible price declines, remember Denver has increased 40% + over the last several years so it is natural (albeit a bit uncomfortable) to give back some of the gains.  Long term the Denver market will remain desirable and an excellent real estate market.



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Written by Glen Weinberg, COO/ VP Fairview Commercial Lending.  Glen has been published as an expert in hard money lending, real estate valuation, financing, and various other real estate topics in Bloomberg, Businessweek ,the Colorado Real Estate Journal, National Association of Realtors MagazineThe Real Deal real estate news, the CO Biz Magazine, The Denver Post, The Scotsman mortgage broker guide, Mortgage Professional America and various other national publications.

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