Economic
Snapshot
A look at the
current real estate market; provided by RE/MAX ALLIANCE
October/2013
Economics seem to rule the roost these days. As
such, there always appears to be some degree of drama attached to them.
Economics are the core issue when it comes to mortgage interest rates
fluctuating up and down, the stock market typifying a roller coaster or the
government shutting down because the political parties can’t agree on what to
do.
Buying and selling real estate is an economic
decision. If a seller decides to sell their home, what is the economic impact
to them? What are the economic options left if they do sell? For a buyer,
deciding what to buy is based to a great degree on their economic situation.
How much can they afford? What is the economic bearing on their financial
state?
The 2013 Boulder Valley housing market has
been a year characterized by economics. On average, home values have increased
across the area in most price ranges. Mortgage interest rates have vacillated
between 3.5% and 4.5%, still residing at near historic levels. Buyers have outnumbered
sellers, with available resale inventory struggling to keep pace with demand
and new home construction continuing to be a viable part of the overall market.
The economic scene across the Boulder Valley has shifted
noticeably over the past nearly two years from the previous seven years when
bank foreclosures and short sales, and depreciating property values were more
the norm.
Below is a brief overview of
the activity level for single family homes in a number of
the Boulder
Valley areas through September/2013,
courtesy of IRES, the Northern Colorado MLS.
Area Active
Listings Solds Y.T.D. Absorption Rate
Boulder
County 1118 2766 110 Days Larimer County 1999 4331 126 Days Weld County 1414 3148 122 Days
====================================
Boulder 351 844 113 Days
Erie 113 315 98 Days
Lafayette 75 257 80 Days
Longmont 370 1028 98 Days
Louisville 43 183 64 Days
Suburban
Mountains 270 246 299 Days
Suburban
Plains 239 464 140 Days
Superior 31 114 74 Days
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Community Totals: 1492 3451 118 Days
The Absorption Rate is the
length of time it would take for the existing inventory to sell assuming the
same rate of sales activity and no new inventory coming on the market.
In September/2012,
Community Totals were 1774 (active listings), 3038 (sold listings) and 160 days
(absorption rate). The Boulder Valley market has
experienced a 16% decrease in active listings, 13.5% increase in sold listings,
and 24% decrease in the Absorption Rate year over year.
Look for the balance of 2013 and moving into 2014 to
mirror what is happening now in the local housing market. Mortgage interest
rates should reside in the 4%+ range, home sales and available inventory will
normally trend down as fall turns to winter.