Each January brings optimism and a renewed sense of purpose. We reflect on the previous year's accomplishments and set new goals for the year ahead. At the beginning of the month, many buyers found themselves in the same place as they were this time last year-seeking to purchase a new home and hopeful for friendlier market conditions, according to the Denver Metro Association of Realtors’ Market Trends Committee.
While market conditions have not changed much, sentiment has. This is our market environment, and it's likely here for the foreseeable future. In some ways, that brings stability-decisions become more complex when too many unknowns exist. We expect mortgage rates to remain steady, while price growth has stabilized. Inventory remains a key factor we are monitoring, as the balance between supply and demand is the most significant variable influencing the market right now.
The main highlight for January was the influx of new inventory. Both the attached and detached markets saw an increase of more than 100 percent from December and were up 38.50 and 29.11 percent, respectively, from January 2024. We typically see an increase in new listings from December to January as sellers reenter the market after a slower time during the holiday season. Active inventory at month's end was up 57.83 percent year-over-year, giving buyers more options as we enter the spring buying season. The median days in the MLS were up 28.57 percent year-over-year to 45 days-the highest median days in the MLS since 2015, a market unfamiliar to many in the Denver Metro area.
The most significant portion of this inventory is in the $500,000 to $749,999 price point for detached homes and under $500,000 for attached homes. These price ranges tend to attract buyers who rely more on mortgage purchases than cash, making them sensitive to interest rate fluctuations. Detached homes over $2 million have seven months of inventory, and attached homes priced at $1.5 to $1.99 million are seeing 19 months of inventory.
Market conditions are similar to those in January 2024. The higher mortgage rate environment lingers, and the optimism felt in January 2024 for multiple Federal Funds Rate reductions and lower mortgage rates did not materialize, presenting buyers with a rinse-and-repeat scenario. As a result, buyer activity was similar to January 2024, with 3,061 properties pending in January 2025, a slight decrease of 0.07 percent year-over-year, and 2,259 properties closed, an increase of 2.31 percent. The median sold price for attached properties increased 0.76 percent, and detached homes increased 2.08 percent. Total sales volume in January was up 7.43 percent, and the close-price-to-list-price ratio was up just 0.04 percent to 98.50 percent year-over-year.
The Denver Metro market's median sale price has increased from $317,000 in January 2016 to $575,000 in January 2025—an increase of 81.38 percent, averaging 9.04 percent per year. This serves as a reminder that real estate is a long-term investment.
Sellers in this market need to be serious and realistic about pricing. "Testing the market" by over-pricing is a risky proposition that leads to price reductions and a longer time on the market. Making your property stand out in a higher inventory environment takes preparation, flexibility and a willingness to work towards a common goal.
With increased inventory, less buyer competition and slow price growth, this is the moment buyers have been waiting for. Now is the time for buyers to start thinking about how to make homeownership work instead of looking for reasons it won't.
Learn more about the market from the Denver Metro Association of Realtors.
Thank you to our partners at the Denver Metro Association of Realtors for compiling this information.
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If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.
