There was an increase in closings of new homes in the Denver, CO market in April year-over-year, and the percentage gain that was sharper than March 2016 seems to indicate improving market conditions. There was a 13.9% rise in new home closings from a year earlier. This came after a 3.4% hike year-over-year in March.
A total of 7,318 new homes were sold during the 12 months that ended in April, up from 7,243 for the year that ended in March.
New home closings represented 11.1% of overall housing closings. This is a hike from 9.0% of closings a year earlier. Following a year-over-year decline in March, closings of new and existing homes also declined year-over-year in April.
Pricing and Mortgage Trends
Average price of newly sold homes had a 4.2% bump year-over-year to $491,840 per unit in April. This boost is smaller than the 6.7% surge in March year-over-year.
For newly sold homes, the average mortgage size grew year-over-year along with new home prices. The average mortgage size rose to $380,422 in April, marking a 1.8% surge compared with a year earlier. In March 2016, average mortgage size on newly sold homes saw a 6.9% surge year-over-year from a year earlier.
Other Market Trends
Closings of attached units, as a percentage of new home closings, have grown from last year while closings of single-family homes have slumped. The share of new home closings belonging to attached units jumped from 14.0% of closings in April 2015 to 20.5% of closings in April 2016. Conversely, the share belonging to single-family homes dropped to 79.5% of closings from 86.0% of closings.
The average unit size of newly sold homes declined 4.6% year-over-year to 2,559 square feet in April 2016. This decline was opposite the price hike, a pattern also seen in March 2016 when the average size of newly sold homes fell 4.2% to 2,499 square feet. In March, the average size of new homes sold went from 2,609 square feet a year earlier to 2,499 square feet.
Foreclosures and real estate owned (REO) closings continued to drop from a year earlier in April, but did not appear to be dragging the market. Out of all existing home closings, foreclosures combined with REO closings accounted for 4.8% of closings, below 7.4% a year earlier. The percentage of existing home closings involving foreclosures dropped to 2.1% in April from 3.3% a year earlier while REO closings as a percentage of existing home closings slid to 2.7% from 4.1% a year earlier.