Luxury Homes in Denver – Sales dip again in July

According to the latest Coldwell Banker Residential Brokerage report, sales volumes of luxury homes in Denver continued to decline in July, along with a drop in median sales prices – but there is a glimmer of good news in that luxury properties sold faster, spending an average of 83 days for sale. Whether this last statistic is skewed by re-listings is difficult to assess. This is the CBRB press release.

“A total of 52 million-dollar homes changed hands in July, down from 65 in June and 91 in July 2008. The median sale price last month was $1.22 million, down from $1.38 million in June and $1.31 million a year ago. However, luxury properties spent just 83 days on the market before selling compared to 103 days in June and 107 days in July 2008.

Sales and median prices have generally been improving across the board since early this year, but we obviously still have a ways to go before the market returns to normal, said Chris Mygatt, president of Coldwell Banker Residential Brokerage in Colorado. The entry level has been rebounding and that improvement will eventually be felt in the upper end as well. But we need to work our way through the process.

Mygatt said the current market represents an outstanding opportunity for move-up buyers who may be outgrowing their existing home. Although they may not be able to get as much for their property as they could have at the peak a year or two ago, larger and more expensive homes have also seen proportionate price declines that could translate into bigger savings for buyers.

If your current home has declined 15 percent from its peak of $500,000, then you may net $75,000 less when it comes time to sell, he said. But at the same time, the move-up home you’re considering probably has also dropped in value by 15 percent  if not more. So a home that was $800,000 at its peak, for instance, may be on sale for $680,000 or $120,000 less, putting you ahead of the game when you trade up. The math can actually work in your favor. July’s decline in sales and median prices in the luxury market is in line with the Denver metro area’s overall housing market. MetroList, Denver’s multiple listing service, announced earlier this month that sales last month dipped 13.3 percent from a year ago, while median sale prices in the region were down 3 percent from the previous month and flat versus July 2008.

Some key findings from this month’s Coldwell Banker Residential Brokerage luxury report: The most expensive sale in the Denver metro area in July was a seven-bedroom, nine-bath home in Cherry Hills Village that sold for $6.3 million;  Denver boasted the most million-dollar sales with 21, followed by Boulder with 7.  It took an average of 83 days to sell a million-dollar home, down sharply from 103 days in June and 107 days a year ago. Homes sold for an average of 87 percent of their asking price, the same as last month, but down from 91 percent a year ago.

The Denver Metro Area Luxury Home Report is produced by Coldwell Banker Residential Brokerage, a specialist in high-end real estate sales. Through its internationally renowned Coldwell Banker Previews program, the company is recognized around the world for its expertise in the luxury housing market. The figures were derived from Multiple Listing Service data of all homes sold for more than $1 million.

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This seems a realistic assessment of the market – although the base market started to decline in value at least two years before the financial crisis began affecting the higher end properties, so we may have a little ways to go yet.