Market Update, August 15, 2024

Gary Keller, the founder of KW, recently told a group of agents that the general economy isn’t experiencing a recession, but the real estate market is.

Is he right?

A recession is a prolonged downturn in the economy, usually defined as two consecutive quarters of negative growth.

But what’s a housing recession? 

There is no one definition, but it’s understood to be a fall in home prices for an extended period or a plunge in sales that continues over months.

Since measuring a recession takes two quarters—or six months—it would be helpful to see what’s happening locally. We decided to look at data from the past eight months, from December 2023 to July 2024.

First, let’s take a look at prices. The median price of a home that sold in December was $552,050. The median price peaked in April at $610,000. Last month, the median price of a sold home was $603,250. So, while prices have fluctuated, the median price of a sold home was about 9% higher last month than eight months ago.

Let’s also look at the total dollar amount of all sales during this period. In December, the total value of homes sold was $1.76 billion. Last month, it was $2.63 billion. The total value of all homes sold peaked at $3.02 billion in May. 

Finally, let’s look at the number of homes sold each month. In December, 2,961 transactions closed, and in July, 4,200 transactions closed. Sales were at their highest in May when 4,831 homes sold. 63% more homes sold last month than during December. Sales rose steadily from January through May.

While volume and prices are down since April and May, the overall trend since last year has been higher prices and more activity in our local market. Gary Keller’s statement about a housing recession is not accurate for the Front Range right now.