Denver Housing Market 2025: Rising Inventory, Price Shifts, and What It Means for Buyers and Sellers

Introduction: A Market in Transition

The Denver real estate market is in the middle of a major adjustment. After years of double-digit price growth and ultra-low inventory, the tide is turning. According to reports from RISMedia and Realtor.com, nearly one-third of listings nationwide saw price reductions in July, with Denver among the most impacted metros. Add in a 47% increase in delistings compared to last year, and the story is clear: sellers are recalibrating expectations, and buyers are gaining leverage.

For anyone buying or selling in Denver, understanding these shifts is critical. Let’s break down what’s happening in the Mile High City right now, why inventory is rising, and what strategies make sense in today’s climate.

Inventory is Climbing in Denver

• More homes for sale than at any point since 2020. Redfin data shows Denver’s active inventory is up double digits year-over-year, with many neighborhoods finally offering choice for buyers who were squeezed during the frenzy.

• Longer days on market. The median days to contract has stretched from 7–10 in 2022 to over 30 in many areas. Certain price bands, especially above $1M, are seeing 45+ days.

• New construction is a factor. Builders across Aurora, Parker, and Castle Rock are releasing finished homes at competitive rates, adding to resale supply.

According to HousingWire, Western metros like Denver, Phoenix, and Salt Lake City are leading this inventory surge, marking a significant departure from the pandemic years of near-zero availability.

Price Reductions Becoming the Norm

RISMedia’s July Housing Trends Report revealed that home prices in Denver have softened by about 3–4% compared to early spring. Roughly 30% of active listings reduced their asking price in July, a sign that sellers are adjusting to new realities.

Key takeaways:

• Move-in ready, well-located homes are still attracting solid offers.

• Outdated properties or homes priced aggressively are sitting, then cutting.

• Attached homes and condos are under the most pressure due to rising HOA fees and insurance costs, which we’ll cover in depth in another post.

For sellers, this means the “list high and let the market catch up” approach is risky. Buyers now expect value and will walk away quickly if pricing doesn’t reflect today’s conditions.

The National Picture: Slowing Appreciation

It’s not just Denver. The S&P Case-Shiller Index shows national price growth slowing to its lowest level since 2023. According to Forbes and the Wall Street Journal, affordability challenges from high interest rates continue to weigh on demand, even in otherwise hot markets.

While Denver’s economy and population growth remain strong long-term, the local market is still tied to national trends:

• Mortgage rates near 6.5–7% are limiting affordability.

• Buyer fatigue from years of bidding wars means fewer people are rushing in.

• Seasonal patterns suggest more reductions as fall approaches.

Best Home Buying Opportunities in 2025

For buyers, this is the best window of opportunity in years:

• Negotiate with confidence. Concessions like closing cost credits, rate buy-downs, and inspection repairs are back on the table.

• Shop broadly. With more inventory, you can actually compare neighborhoods and house types instead of settling.

• Pay attention to time on market. If a property has been sitting 30+ days, odds are the seller is ready to deal.

Homes that go under contract today are often selling closer to or even below asking price — a big change from the over-asking chaos of 2021–2022.

Key Mindset Shifts for Selling in 2025

Selling in 2025 requires a mindset shift:

• Price strategically from day one. Overpricing leads to long days on market and bigger cuts later.

• Invest in presentation. Staging, professional photos, and Compass Concierge upgrades can still make your home shine against the competition.

• Be flexible. Whether it’s covering part of a buyer’s closing costs or offering a rate buy-down, small incentives can help secure a contract quickly.

Compass data shows that well-priced homes in A+ condition still move swiftly. But sellers who ignore the competition risk languishing.

Denver Neighborhood Spotlight

• Northwest Denver (Highlands, Berkeley, Sunnyside): Still seeing steady demand thanks to location and walkability, but smaller bungalows are selling faster than larger, higher-priced properties.

• South Suburbs (Littleton, Highlands Ranch, Parker): Inventory is highest here, giving buyers leverage on two-story family homes.

• Downtown & LoDo Condos: Facing the most challenges as insurance and HOA costs bite into affordability.

Questions Buyers and Sellers Are Asking

Is Denver a buyer’s or seller’s market in 2025?
Denver is moving closer to a balanced market, with some segments leaning toward buyers thanks to rising inventory and longer DOM.

Are Denver home prices dropping?
Yes, on average prices are trimming back 3–4% compared to earlier in the year, with reductions most common on condos and higher-priced listings.

Should I wait to buy a home in Denver?
If mortgage rates drop later in 2025, competition could spike again. Right now, buyers have the rare advantage of choice and negotiating power.

Conclusion: A Market of Opportunity

The Denver housing market in 2025 is no longer the frenzy it once was. Rising inventory, longer days on market, and more price reductions mean buyers finally have leverage. Sellers, on the other hand, must adapt with smart pricing and creative concessions.

Whether you’re buying your first home, moving up, or considering selling, this is a pivotal moment to make moves with the right strategy.

📞 Ready to talk about your options in Denver’s shifting market? Contact me, Sallie Simmons, REALTOR® at Compass and Nostalgic Homes, at www.salliesimmons.com or 662-588-2420. Let’s create a plan that works for you.