Tuesday, October 19, 2010

Economic Snapshot For Boulder, Weld and Larimer Counites



A look at the current real estate market; provided by RE/MAX ALLIANCE



October/2010



Over the course of the past eighteen months, the Federal Government implemented the Homeowner Tax Credit Program. The Federal Reserve lowered the Federal Funds Rate for member banks to borrow funds to nearly zero percent. Home mortgage interest rates have fallen to the lowest level in more than fifty years. Now, members of the banking industry are taking a sabbatical by not foreclosing on homes. All of these factors were/are designed to stabilize and stimulate the housing industry. Despite all these efforts, the housing market continues to quietly drift along.

There have been spurts of activity. The Boulder Valley real estate market was UP in sales activity at the end of June/2010 as compared to the end of June/2009 for both single family homes (+36%) and attached units (+34.5%). But those numbers have dropped since the Homeowner Tax Credit Program ended in late April/2010. Through September/2010, single family home sales are UP 13.5% Y.T.D. compared to Y.T.D. 2009; and are comparable for attached units. Thus, the Boulder Valley real estate market hasn’t sustained itself.

One of the best indicators of real estate market activity is the time it takes for the market to absorb itself. A healthy real estate market is thought to be around six months of available inventory. That time frame provides buyers with an adequate selection of homes and sellers with a reasonable amount of time to sell. The “absorption rate” for the Boulder Valley real estate market has vacillated between nine and ten months for most of 2010. Through September/2010, the absorption rate stands at 270 days; nearly nine months. As we enter the fall and winter, the absorption rate should remain around the same level as both inventory levels and sales dwindle.

The question now becomes, “What’s next?” What magic elixir can the Federal Government and banking community pull out of their proverbial hat? The answer isn’t putting more lipstick on the pig, because you still have a pig. The answer always comes back to one four-letter word; the word that drives the economy and fosters the housing industry. That word is “jobs”. Jobs are the Holy Grail; the path to redemption; the pot of gold at the end of the rainbow. Without them, you have a stagnant economy, which naturally leads to a declining housing market.

Below is a brief overview of the absorption rates for single family homes in a number of the Boulder Valley areas through September/2010. Thanks to IRES, the Northern Colorado MLS, for all their magic numbers.




Area                          Active Listings                     Solds Y.T.D.                                Absorption Rate


Boulder County              1946                                     2054                                    8.5 Months
Larimer County               2777                                    3066                                     8.1 Months 
Weld County                  1836                                     2341                                    7.0 Months

====================================

Boulder                           652                                         646                                    9.0 Months

Lafayette                         169                                         187                                    8.2 Months

Longmont                        601                                         720                                    7.5 Months

Louisville                         105                                         157                                     6.0 Months

Suburban Mountains        380                                         182                                   18.7 Months

Suburban Plains              455                                          347                                   11.8 Months

Superior                           52                                            82                                     5.7 Months

======= ======= =========

Community Totals:           2414                                       2321                                   9.4 Months

Thursday, October 7, 2010

Boulder County Real Estate absorption rate



The number shows the rate at which the inventory of homes for sale are being sold. A declining figure indicates people the inventory is decreasing as more homes are being sold than are coming onto the market. A rising absorption rate implies that there are more homes coming onto the market than there are buyers willing to buy at the market prices.



The absorption rate lets you know how well the market is absorbing the current inventory of listings

Tuesday, October 5, 2010

Some push for foreclosure freeze in Colorado

Moves by three major mortgage companies to halt foreclosures while they examine their procedures haven't affected homeowners in Colorado, but some in the state would like to see the foreclosure moratoriums extended here.




The lenders have temporarily stopped processing foreclosures as they investigate whether information included in foreclosure documents was properly verified.



Colorado hasn't been affected so far because of the unique process that foreclosures go through here.



"We are the only state that operates through a public trustee," said Stephanie Riggi, manager of the Colorado Foreclosure Hotline. "In other states, a lot of these (foreclosures) were handled through a court proceeding. It may not impact our homeowners who have gone through foreclosures."



But many in the legal community think the moratoriums in place in other states should be extended to Colorado because the foreclosure process is so complex that it's difficult to determine whether the cases have been handled improperly.



Attorney General John Suthers asked Ally Financial to extend the freeze by its GMAC Mortgage unit to Colorado and is considering asking other banks to do the same.



"It's possible that there could be home owners that could be affected here," said Mike Saccone, spokesman for the attorney general's office. "We're still in the exploratory phase. We're still trying to determine if these processes could have affected Colorado consumers."



Other lenders that have suspended foreclosures are JPMorgan Chase & Co. and Bank of America Corp. Separately, news came out this week that a Wells Fargo executive said he verified only the dates on up to 150 foreclosure documents he signed daily. He said he trusted co-workers to make sure other information in the documents was accurate.



Wells Fargo has said it has no plans to stop foreclosures, because the bank is sure that its documents are correct.



Real-estate attorney Robert Goodbinder said the bulk of foreclosures in Colorado are never challenged, because most people don't hire an attorney to help them.



"Because they're not challenged, they just sail through," he said. "We've got a huge number of foreclosures, and the borrowers aren't qualified to determine whether there's a problem. Judges don't set these for a hearing unless somebody files an appropriate response. Virtually no one who is a borrower would know what to look for."



Foreclosures in Colorado rose from July to August but are running lower than last year, according to a report last month from the Colorado Division of Housing.



Statewide foreclosure filings in August totaled 3,142, up from July's 2,718 but down from 3,496 in August 2009.



Ryan McMaken, who tracks foreclosure numbers for the Colorado Division of Housing, said that even if the banks do halt foreclosures here, it's not likely to make a difference in how the local housing market is perceived.



"I think people will know it's a policy change and will proceed with the normal level of caution," he said.



Margaret Jackson: 303-954-1473 or mjackson@denverpost.com







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Read more: Some push for foreclosure freeze in Colorado - The Denver Post http://www.denverpost.com/business/ci_16253886#ixzz11V5nsJ4Q