The median age of Denver’s house inventory was the lowest of 146 metropolitan statistical areas tracked by Realtor.com. in June, the third consecutive month Denver could be described as the fastest selling housing market in the nation, using this measure.
While the median age of inventory is not a frequently cited metric, in recent months it has been used as a proxy for the sales velocity of homes by some real estate observers and analysts, which have anointed Denver as the fastest selling home market in the country, based on Denver’s No. 1 ranking using this calculation. However, the age of inventory should not be confused with the more common method of tracking how long it takes to sell a home, the average number of days on the market.
30 days lowest in nation
In June, the median age of inventory in Denver was 30 days, about a third of the national median age of 93 days. Denver’s median inventory age was down 23 percent from May, the largest percentage drop of any market in the U.S. on a month-to-month basis. Nationally, the inventory age creeped up by 1 percent from May, as well on a year-over-year basis. Denver, on a year-over-year basis, however, saw a 36.2 percent drop. Only Philadelphia and Savannah, with 62 percent and 40.3 percent declines, respectively, showed larger percentage drops from June 2010. Denver had the lowest inventory age in May, and tied with Oakland for the lowest in April.
Jill Kipnis, spokeswoman for Realtor.com and a sister company, Move.com, noted that “we don’t calculate the median age of inventory to establish sales rates,” adding that it is “interesting” that some industry officials have been using it in that fashion.
So what is it exactly?
Realtor.com calculates the median age of inventory by first determining all the active listings at any given time period, whether it is a month, quarter or year. Then, the days on the site are calculated by subtracting their listed dates from the earlier of their end listing dates or the end of the time period. Next it takes the median of all the resulting individual days on site. This accounts for properties that were withdrawn from an MLS and subsequently re-listed, Kipnis notes. “Because median age of inventory in these reports is the days a listing is displayed on Realtor.com, it may differ from days on market calculated by the MLS where the listing is posted,” she explained.
Independent Realtor Gary Bauer performs his own analysis each month on the Denver market, using Metrolist data.
“My initial thought is that it is good to see the Denver market is being recognized,” with the latest ranking by Realtor.com. “But we need to keep in mind that this is just another data point. Data points are only the first step in telling the story. It is the trend that is important.”
Other findings for Denver by Realtor.com in June included:
- The median list price was $257,500, down 2.8 percent from May 2010 and a 1.5 percent increase from May. The national median list price in June was $189,900, a 0.95 percent decrease from June 2010.
- Active for sale inventory In June was 7,203, an 8.3 percent increase from June 2010. Nationally, there were almost 2.4 million inventory counts, down 15.8 percent from a year earlier.
- Nationally, Denver ranked No. 22 for Realtor.com web searches. Colorado Springs was No. 55; Boulder-Longmont, 111; Fort Collins-Loveland, 125; and Pueblo, 144. Chicago was the No. 1 searched city on Realtor.com in June.
More than 933 multiple listing services across the nation provide real estate information to Realtor.com, the most searched real estate website in the nation.
Contact John Rebchook at JRCHOOK@gmail.com
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