John Rebchook is a former Rocky Mountain News reporter with more than 30 years of experience in writing and communications... The Denver-area housing market had its strongest July as far as the rate of sales each week in at least seven years, according to an analysis by InsideRealEstateNews.com.
The weekly sales rate in July was 5.84 percent, according to a report released today by independent broker Gary Bauer. Bauer bases his report on monthly statistics gathered by Metrolist. I reported on it in an earlier blog.
Using statistics going back to 2002, I found this was the strongest weekly sales rate for a July on record. The sales rate is based on the number of homes placed under contract. By contrast, the absorption rate, is based on the number of home closing.
“The reason is because of strong sales of homes priced below $300,000 and the smaller inventory,” Bauer told me. Later, he said he isn’t surprised that it is at record levels, because the sales rate has been rising every month.
Another way to look at it, as Scott Nordby, the co-owner of Innovative Real Estate, said last month at a staff meeting, is that there are fewer homes on the market, but a higher percentage of them are selling.
“That is something the media never points out,” Nordby said.
And he is right. Even at the Rocky Mountain News, I didn’t spend a lot of time looking at this metric.
But it very well may be the strongest indication that the Denver-area housing market is beginning to emerge from its slump.
The weekly sales rate was about 10 percent higher than it was in July 2008, when it stood at 5.29 percent.
And it is 130 percent higher than when it was a mere 2.54 percent in July 2003, the lowest sales rate on record in recent years.
Six years ago, there were 26,764 homes on the market. That’s 21.9 percent more than the 20,890 homes on the market this July.
So a 130 percent increase in sales activity when the supply of homes is down 22 percent, is good news indeed, and bodes well for the health of the market.
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Source: Gary Bauer
