Denver Southeast Million Dollar Market Slows

Once upon a time, Washington Park was not part of the million-dollar market. Now it has a significant presence. So it might be interesting to see how Washington Park is doing in this price segment when compared to other neighborhoods in Denver Southeast.

The sales volume of homes with prices over $1 million has dropped 38% in the first 5 months of 2008 when compared to the same period in 2007. The inventory levels are at an all time high with 27 months of inventory available. Many neighborhoods should be off limits to builders until the inventory works its way through the system. In our analysis we are seeing a recurrent theme: smaller houses sell faster than larger houses. Days-on-market are, in general, a multiple of the overall Denver rate of 95.

Neighborhood Months of Inventory Days-on-Market

Belcaro 50 126

Bonnie Brae 13 105

Cherry Creek 44 239

Cherry Creek CC 10 266

Cory Merrill 26 180

Country Club 24 219

Crestmoor 16 202

Driving Park 10 62

Eisenhower Park 10 13

Hilltop 23 189

Lowry 7 189

Observatory Park 19 220

Polo Club 5 136

University Park 38 225

Washington Park 14 169

27 223

When compared to the other neighborhoods Washington Park's performance is in the middle of the pack. Inventory levels are at 14 months, definitely a buyer's market.

Our research has identified a hole in the product offering: 3000 square foot new builds for under 41 million. This won't happen until, and if, the dirt price falls to $350,000. Since this is not likely to happen (although it is at $250,000 in Cory Merrill), perhaps the next evolution will be smaller houses with more elegant finishes.