Through the first three-quarters of 2018 nearly 11,000 residences, including attached and detached single family homes, sold in the city of Denver. Countless statistics can be derived from such a robust dataset; however, above all, there is one metric that must be considered if you are preparing to sell your residence.
Narrow your Scope.
A broad knowledge of the market is key to understanding general market trends across the metro area; however, over-generalizing the marketplace can be a detriment to your success in selling your home. Instead, consider what’s happening amongst your peers in your price point. Knowing market dynamics at your price point will help you understand consumer sentiment and buying habits germane to your property.
Define a Segment.
Below is a breakdown, by percentage, of market segments and their share of the total market in 2018 thus far:
- $2.000M+ 82 Sales 0.76%
- $1.500M - $1.999M 112 Sales 1.04%
- $1.000M - $1.499M 409 Sales 3.80%
- $750,000 - $999,000 838 Sales 7.79%
- $500,000 - $749,000 2,655 Sales 24.68%
- $250,000 - $499,000 5,368 Sales 49.91%
- $250,000- 1,292 Sales 12.01%
Understanding the Data.
The year 2015 marked the first time in Colorado’s history that the millennial population surpassed that of the baby-boomer generation. While the millennial generation is the largest group in the United States and the future of the nation’s labor force, it’s important to remember that millennials are young and relatively early in their careers which means that their buying power is comparatively low to other consumer groups. Denver is growing and a large percentage of our growth is attributed to millennial migration. In fact, in 2014, 52% of the in-migration were millennials.
“75% of the entire market falls between $250,000 and $750,000 with the market share (buyer pool) dropping quickly as you move toward the periphery of the bell curve.”
The Bottom Line.
Make a conscious effort to filter out the noise of over-simplified statistics and attention-grabbing headlines. Instead, leverage micro market activity to craft a sales and marketing strategy tailored to your price point. A strategy employed on a $500,000 single family residence should be different than one leveraged on a $2.000M condominium. First impressions are important and days-on-market are critical. Defining your sub-market and working within its boundaries will yield the greatest success.
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