Jun 2, 2022 - News

All-cash offers for homes hit 10-year high in Denver

Percentage of Denver home closings made in cash
Data: Denver Metro Association of Realtors; Chart: Axios Visuals

When it comes to buying a home in Denver, cash is king.

What's happening: Cash offers — which most buyers can't put up — are a sign of a tight market, Axios' ​​Felix Salmon writes.

  • In this dog-eat-dog environment, there's little hope that steep mortgage rates will bring prices down, especially considering high borrowing costs don't deter cash buyers.

State of play: The proportion of Mile High City houses bought with Benjamins recently hit its highest level in a decade, according to data provided to Axios Denver by the Denver Metro Association of Realtors.

  • The region saw a 65% increase in March cash sales from 2020 to 2021, and another 5% jump in March 2022 compared to the previous year.

The big picture: Denver's rush of cash closings reflects a nationwide trend.

  • Homes sold for cash across the country reached a new peak of 28% this March, the highest point since the crisis years post-2008, when a lot of home sales were foreclosures, according to the National Association of Realtors.

Zoom in: Within city limits, the latest market data from the Denver Metro Association of Realtors shows it's still tough to house hunt in this market.

  • As of April, single-family home listings year-to-date were down 2.4% from 2021, while the number of days homes were listed on the market dropped 38%, to just 10 days.
  • At the same time, median home sales prices in metro Denver rose 15% — to $717,000 — from April 2021 to April 2022.

The bottom line: Homebuyers in the Denver area are not only wrestling with surging mortgage rates but also having to weigh whether to cough up cash offers to win all-out bidding wars.

  • The cutthroat competition is making it difficult for many people hoping to buy a home.

Related: Here's how much people overpaid for a home in Denver

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