Metro Denver Real Estate Market Forecast for 2022 and 2023
Metro Denver real estate market predictions for the balance of 2022 and through most of the first half of 2023 points toward positive growth in home prices, according to some real estate observers and leading real estate websites; this in spite of the government’s recent Inflation Reduction Act, rising interest rates, and the Dow Jones experiencing a major downward spiral.
At the start of January 2022, the metro Denver area had only 1,477 active properties on the market, which is 11,175 fewer than normal. Due to sustained demand for housing and a lack of inventory, the market was expected to experience double-digit appreciation during the fourth quarter of 2022.
Denver has a track record of being one of the best long-term real estate investments in the country. Denver’s strong economy gives buyers the ability to spend more on housing, consequently increasing real estate prices.
Home values rose so much overt the past six or seen years that affordability became an issue for a person earning the median income in the metro area. Since the last decade, Denver-Aurora-Lakewood metro home values have appreciated by nearly 160 percent. The typical home value in the metro Denver area is currently $629,632. It indicates that 50 percent of all housing stock in the area is worth more than $629,632 and 50 percent is worth less (adjusting for seasonal fluctuations).
During the latest 12 months alone, the Denver appreciation rate has been at nearly 14.86 percent, and in the latest quarter, the appreciation rate has been 1.29 percent. If it remains steady, the annualized rate of appreciation becomes 5.29 percent, so home prices in most of the metro area are predicted to increase slightly in the next three to six months.
According to some real estate gurus, the demand for housing from new homebuyers will push prices higher during the fourth quarter of 2022 and into the first quarter of 2023. In next year’s second quarter, it’s projected that the market will return to a normalization period. Higher interest rates are expected to translate to more inventory, lower or flat prices, and longer days on the market.
The typical value of homes in Colorado statewide is currently holding at $580,275. Colorado home values have gone up 14.7 percent over the past year and will continue to rise over the next 12 months, according to some optimists. Others are predicting more affordability throughout most of 2023.