Jul 22, 2023 - Real Estate

Condo competition heats up in Denver

Illustration of a row of condo buildings with one wall rising up into the sky and forming an upward pointing arrow

Illustration: Annelise Capossela/Axios

First-time buyers are setting their sights on condos in hopes of more affordable — and lower maintenance — homeownership.

Why it matters: With mortgage rates inching back up to 7%, buyers' budgets don't stretch as far as they might hope.

  • Buyers have had to readjust their expectations in terms of what money can buy, Brandi Wolff, a Denver-based agent at Guide Real Estate, tells us.

What's happening: All of this demand has spurred hot competition in the condo market.

By the numbers: Half of all condos are going under contract within 10 days, and condo sales prices are up 2% since January, Wolff shared.

  • Supply, although improved, is still low at 1.5 months.

The intrigue: That means if no more condos hit the market, all of the inventory would be completely gone in about six weeks.

  • In June, condos closed for an average of 100% of their list price, which signals bidding wars, Wolff says.

Of note: Generally, demand is higher in the suburbs.

The big picture: More buyers have turned to condos and townhouses as home prices surge, Realtor.com analyst Hannah Jones tells Axios.

  • Across the U.S., that segment's prices are now climbing at a faster clip than single-family homes, the company's data shows.

Yes, but: Condos are still the more affordable option. The median sales price for a condo in Denver was about $273,408 less than a single-family home here, June data provided by Zillow shows.

Reality check: The post-pandemic housing shortage is keeping prices high across the country.

Year-over-year change in median sales price of homes in Denver
Data: Zillow; Chart: Alice Feng/Axios

Denver condo prices have fallen a little slower than single-family homes, per the latest Zillow data.

  • In May, the typical condo here sold for about $362,418, compared with about $635,826 for a single-family home.

Yes, but: Denver condo owners need two years of income to upsize to a house, according to a March analysis by real estate company Point2.

  • In Aurora, that gap grows to 2.9 years.

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