When first time home buyers Andrew Wood and Nicky Dallek put down a bid on a North Denver house that was $100,000 over the asking price, they felt fairly confident their offer would be accepted. A few days later, Wood and Dallek learned they had lost out to another bidder, who put down an offer that was around $175,000 higher than the seller originally asked for.
“We absolutely loved the house,” Wood said. “I’m still mourning over losing it.”
The couple are both Colorado transplants who’ve settled into life in North Denver, enjoying a plethora of activities and becoming friendly with those in the community. Like many others, when looking to buy a house in the area, they’ve felt the impact of a cutthroat, uberly competitive, market.
Originally, they honed in on the Northwest Denver area. After struggling to secure a home, Wood and Dallek have casted a wider net, looking at nearby neighborhoods in South and East Denver. The goal is still to buy a house in North Denver. However, following a grueling experience, they’ve decided to postpone their housing search until after their wedding in mid-June.
“It feels like you put in so much work and it’s a little draining,” Dallek said. “It’s like ‘how many offers do I have to put in? How many houses do I have to see?”
Kathy McBane works as a real estate agent covering the North Denver region. She says the perfect storm of the influx of millennials looking to buy in the area and historically low interest rates have created massive demand.
“We’ve been in a competitive market for the last few years,” McBane said. “The majority of properties have been selling in the first few three-to-seven days on the market, and have been selling for asking price – and in a lot of cases with competitive offers. But not like this.”
Although she’s seen many millennials, McBane’s noticed the demographic of buyers has ranged from native Coloradans who lived out-of-state and are pursuing a move back, to empty nesters seeking more convenient city living.
For those who sold a home in Denver to buy another one in the area, there was madness on both ends. Eric and Chona Miller are veteran nomads, having previously moved three times in as many years. When searching for their next house in North Denver, they had the home buying experience from hell.
Many showings were restricted to 15 minutes, and the couple recalls overlap, where other potential buyers waiting for a tour mingled on the front porch creating a “house party” type setting. Despite the uninviting atmosphere and limited viewing window, the Miller’s felt obligated to act fast.
“It puts so much pressure on you because you know it’s so competitive,” Chona said. “We were pressured into thinking we got to make an offer because there’s nothing available.”
Ultimately, they fell in love with a house in the West Highlands, but closing the actual deal was equally as stressful as deciding how much to offer for each given place. They decided on their current house after touring it on a Friday, at which point the seller told them they’d be accepting bids until Monday. Hours later, the seller decided to cut off bidding that night.
Even after the Millers were verbally informed their bid had been accepted, the seller balked, demanding a better offer. They wound up paying $15,000 more than originally planned, and $100,000 over the initial asking price.
“It goes past rational to emotional – you get this irrational bidding frenzy,” Eric said. “It was like a roller coaster for us, we were excited in the morning and by night we were like ‘oh my god,” Chona added.
When selling their old home, the Miller’s had 37 showings. In deciding who to sell to, they considered a variety of factors including offer price, number of contingencies, and type of payment – they preferred cash. Acting from experience, the couple also tried to be transparent with updates about where they were in the process.
“We were like ‘okay,’ let’s try not to do to these people what was done to us, let’s try to keep it sane,” Eric said.
Image from Redfin.com
Year after year, home prices in Northwest Denver continue to rise. According to Redfin.com, the median average price of a home in the area was $472,500 in March of 2017. Four years later, March of 2021 hit a record high of $700,000, dipping slightly to $625,500 for May of this year, with the overall trend continuing upwards.
“This year is something quite extraordinary merely by the fact that the pandemic played a certain role in this because we were limited on our inventory,” said Jenny Apel of Nostalgic Homes | Compass. “That created a headache and hassle for buyers.”
When approaching home buying in a tumultuous environment, it’s advised potential buyers have a distinct set of criteria in what they’re looking for.
“You have to come to it with a realistic attitude of what exactly are my needs,” said Apel “You have to have some good guidance and some good counsel in what you can achieve.”
Apel’s seen a particularly large uptick in demand in Northwest Denver and the surrounding suburbs. With a limited supply of homes for sale, it’s expected the competition to buy a home in the area will continue to get tougher.
Jack Stern is a Denver based freelance multimedia journalist, reporting on all things Colorado. Previously, he covered the Colorado Buffaloes football and basketball team for SBNation and Rivals.com.
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