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If it wasn’t for the cool nights, all of the holiday lights I am seeing after hours, and showing homes in the dark at 6:00pm, I don’t think I would believe we’re already writing our annual Denver real estate market year in recap article. Whether or not I accept the year is coming to an end, it is. So, with that, let’s take a deep dive into how Denver’s real estate market did in 2024.

To better understand 2024’s market, let’s first take a moment to remember how 2023’s market ended. This time last year, every real estate agent, lender, and title company’s social media account was sharing posts regarding buyers flooding the market if interest rates were to come down, and, arguably for good reason. The Feds were sharing high hopes for up to 6+ interest rate cuts throughout 2024. This marketing message got a lot of buyers excited and prepped for lower rates and ultimately entering the market. Unfortunately, as they say, hindsight is 20/20 and looking back, this belief is probably a big reason for the Denver’s real estate market environment throughout 2024.

Interest rates in fact never came down a whole lot throughout 2024, with most buyer’s seeing rates remain in the mid to high 6s; a few might have been able to lock in low 6s for a very short period of time in late August or early September. However, after this quick dip, they shot right back up to high 6s and even low 7s through the rest of the year. The Feds did eventually lower rates, first in September and then again in November. However, these rate cuts did not help bring mortgage rates down like many industry experts were hoping. In fact, the second rate cut in November was barely even talked about in the media or around the office at real estate firms; simply put, it was uneventful.

With rates remaining high throughout the year, many of the homebuyers and sellers that thought they’d act in 2024 quickly realized rates weren’t going to align with the widespread expectation for 2024. Many sellers and buyers retreated and decided to stay put and not act on selling or buying a home. The decision by many homebuyers and sellers to sit out of the market this year shaped Denver’s 2024 real estate market. Now that we understand why Denver’s market acted as it did in 2024, let’s look at what this means as far as home values and trends.

The factual data shows that Denver’s median close price ultimately rose from January to December 2024 by roughly 6% or $33,007. Now, I know what you’re thinking—that’s great news: Denver’s home values are up 6% year-over-year. However, before you celebrate, I have a different opinion on this—as I have throughout the year—which I have shared in our Monthly Denver Market Update articles.

What this data doesn’t explain is how Denver’s market was widely split into two different home types—those priced above a million and everything else. This year, a unique trend we saw was higher priced homes, above a million, were selling faster and more frequently than those priced below a million. In fact, on more than one occasion, I witnessed homes priced above a million sell with multiple offers and well over list price. So, my theory on why this median sold price is up nearly 6% isn’t due to the average home in Denver being up in value by 6% year-over-year but because we saw a higher number of homes priced above a million sell versus under this year. With more homes selling with higher prices, it drove this median sales price up. This, in turn, is giving the false illusion that home values in Denver are up nearly 6% in 2024.

This brings me to my opinion on Denver’s actual real estate trends in 2024. If a home is valued below that million-dollar price point, the year-over-year value could be up a few percent, flat, or even down a few percent from where it was in January 2024. Before you call out that I am saying your home is worth either less, the same, or more and that I am not making any statement allowing me to be right or wrong, hear me out. Homes that are priced lower, $550,000 and below, very likely, saw deprecation year-over-year, homes valued around the $750,000 to $800,000 price point are likely fairly flat with their value, and homes between the $750,000/$800,000 to $1,000,000 price point likely saw some appreciation year-over-year.

The reason I believe this is if you watch trends of homes in these different price points you can clearly see which ones are doing the biggest price reductions and which are sitting on the market longer. Also, the logic behind this makes sense as well. Buyers in these lower price points typically have less cashflow available for their mortgage; therefore, they can’t purchase based on the idea of lower rates, they have to realize them in order to make it make sense to purchase. While buyers in the higher price point typically have more available cashflow; therefore, they are not as restricted to waiting for interest rates to come down to purchase. Since we already determined above that interest rates did not come down in 2024, these lower priced homes struggled throughout the year to attract buyers willing to purchase with the higher interest rates. This is why the lower priced homes saw little to no appreciation in 2024, and the higher priced homes did because more buyers were in the market for these higher priced homes versus the lower priced homes.

The good news is this: 2024 was a challenging year for homebuyers with continual high interest rates; however, we still saw Denver’s market being able to continue to grow in some areas and price points and stay flat in others. This means that even in a difficult market for buyers, there is still enough demand for Colorado homes that values did not come down. This is good news for those who bought in 2024, those that already own their home, and those who are still looking to own a home in the Denver metro area.

So, with this, 2024 is officially coming to an end, and now we’re looking onward to 2025. If you’re reading this still, it means you’ve got an interest in Denver’s real estate market. If that’s the case, then you definitely want to mark your calendar for the first Thursday of January 2025 because that’s when we’ll be releasing our 2025 Denver Market Prediction article. Until then, remember to contact us with any of your Denver real estate needs; no holiday is stopping us from helping Denver sellers or buyers reach their real estate goals!

~ Written by TK Homes CEO/REALTOR®, Trevor Kohlhepp