The number of unsold homes in the Denver area real estate market plummeted in October, falling to an almost three year low.  This is largely due to homeowners keeping their houses off a market loaded with a large inventory of foreclosed homes.  The 23,120 unsold homes on the market represented a 20.1 percent drop from October 2007.  The last time the inventory was lower was in January 2005.  It was the eighth consecutive month that the inventory of unsold homes dropped from the same month a year earlier.  The inventory is down 27.7 percent from its peak of 31,989 homes on the market in July 2006.

 

The average price of a single-family home sold in October was $250,172, down 13.6 percent from $289,754 in October 2007, but there were 4,504 homes placed under contract, down only 3 percent from 4,645 in October 2007.

 

There were some notable exceptions to downward trends in price and closed sales of single family homes.  In the South Suburban East area, closed sales were up 11.1 percent in October over last year, and the average price increased 6.0 percent from $499,455 to $529,217.  Similarly, the South Suburban Central marked showed a 16.0 percent increase in closed sales and a 2.6 percent increase in average price from October of last year from $280,097 to $287,341.  In the Highlands Ranch/Lone Tree area, sales were down 10.6 percent year over year, but average price was up 2.8 percent to $350,513.  Even with the decrease in number of sales, Highlands Ranch/Lone Tree has only 4.3 months’ worth of inventory.

 

Experts anticipate the real estate market will not reach bottom until the end of next October, with the biggest barrier to trying to take advantage of low home prices being the difficulties in obtaining a mortgage.  The government will need to step in quickly to prevent further erosion of housing prices and stop the foreclosure crisis sweeping the nation.