Boulder Valley Real Estate Update

Economic Snapshot

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

November/2014

The days grow shorter. The nights grow longer. We edge toward the end of another year. That sounded a little morbid, didn’t it? All new beginnings must ultimately have an end.

Real estate markets always have a new beginning. When the frigid days of winter give way to the warm days of spring, a renewed optimism in the minds of buyers and sellers begins to blossom. Change is in the air.

It’s like running a marathon. At the starting line (the beginning) there’s a nervous energy prevalent in the participants. Smiles flourish. Good wishes are offered. There’s a loud bang and they’re off. A few hours later (the end) the picture is a little different. A lot of energy has been expended. The participants are tired, but there’s a sense of accomplishment, a sense of purpose. Fulfillment reigns supreme.

When we look at the Boulder Valley real estate market thus far in 2014, from a new beginning to an impending end, we see the various aspects of a marathon.

·         We started the year with home mortgage interest rates around 4.47% for the traditional thirty-year fixed rate loan. At this writing the rate is about 3.93%. No major hills and valleys to be encountered here as we run along.

·         Home values across the Boulder Valley increased on average by about 5.89% when compared to last year ($517,488 vs. $487,008). That’s good stuff. We’re keeping a steady pace, running with the wind at our back.

·         Home sales across Boulder County are down slightly when compared to 2013. Single family sales are off about 8.44% (2,799 vs. 3,057). Attached unit sales are up about 2.04% (1,196 vs. 1,172). The combined market is down about 5.54% (3,995 vs. 4,229). A few hills to traverse here. Need to expend a little more energy, but not a lot of ground to make up.

·         Available inventory continues to be an ongoing issue. New construction has somewhat filled the void with production homes being built in several of the communities to the east of Boulder. Boulder County started the year with 769 single family active listings. At the end of October there were 981 single family active listings. That number will continue to drop by the end of the year to be somewhat comparable to where we started.  We’re on a flat surface now. A gentle breeze carries us along. The finish line is in sight.

As we race toward the end of the year, we can look back with some degree of pride on what has been accomplished. It’s been a long ten months plus thus far, with a steadfast resolve to help buyers and sellers meet their real estate needs. There have been a few transactions that have gone awry, but many more that went as planned, resulting in satisfied buyers and sellers.

Just beyond the horizon sits a new beginning, awaiting its time and opportunity to spring forward and make its presence known. What lies ahead for it is unknown, but as Ralph Waldo Emerson said: “Life is a journey, not a destination.” Take the time to enjoy the run. 

Real Estate Market Update for the Boulder County Area.

Economic Snapshot

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

April/2014

            “Go west, young man” was a popular phrase in the 1800’s advocating the westward expansion of the country.  The phrase symbolized the idea that agriculture could solve many of the nation’s problems of poverty and unemployment characteristic of the big cities of the East.

            In the Boulder Valley, since the early 1970’s, there has been an on-going expansion of the bedroom communities east of Boulder. It started with new home construction in Louisville and Lafayette, then progressed to Superior, and now has found its momentum in Erie. Retail and commercial development followed in the footsteps of new home construction – you need to have rooftops to support business development.

            The most apt phrase today would be “Go east, home buyers!” There are several reasons for this: (1) New construction, at reasonable prices, continues to populate the landscape. (2) Resale homes, although at a low level (364 active single family home listings, with 150 of those under contract. 68 active attached unit listings, with 36 of those under contract.), are a good value. (3) Open space and recreational facilities have been a key component of growth throughout these communities, with quality of life being a major focus. Biking and jogging trails stretch from one community to the next. For young families, these are fantastic areas to raise children. Did I mention the awesome mountain views?  

With all this talk about going east, below are some sold numbers for single-family homes for various geographic areas throughout the Boulder Valley. Information is courtesy of IRES (the Northern Colorado MLS).

                                                           2013 Sales                2014 Sales

                                                          1^st Quarter               1^st Quarter          

                         Area                        Single Family          Single Family       % Change

              Boulder                                        143                           117                  -18.19%       

              Erie                                              70                             106                  +51.42%

              Superior                                       23                             18                    -21.74%                   

              Louisville                                     30                             27                    -10.00%

              Lafayette                                     51                             50                    -1.97%         

              Longmont                                    235                           181                  -22.98%       

              Suburban Plains                           96                             93                    -3.13%

              Suburban Mountains                   42                             43                    +2.38%        

                                                                   ===                          ===                 ====

                  TOTAL                                  690                           635                  -7.98%

            As various communities reach a build-out stage, the natural tendency of home builders is to search for virgin ground. Over the course of the past forty plus years that ground has been found east of Boulder. These small bedroom communities have grown over time and created their own identities. If you’re considering a move, take the time to “Go east!” and you’ll find a multitude of housing and family/retirement oriented opportunities.

Housing Economic Snapshot

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

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

             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.     

Boulder County Economic Snapshot

Economic Snapshot

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

June/2012

            The term “global economy” has become part of the daily jargon as it relates to the ups and downs of the world’s various stock markets and the financial entities attempting to create some semblance of order to the world’s economy. Uncertainty appears to be the norm these days as Wall Street traders grapple with a market vacillating between bears and bulls, impacted by the doings across the pond and along the Pacific Rim.

            Locally, the Boulder Valley real estate market continues to show signs of stability as sales activity has improved thus far this year when compared to the last few years. Through May/2012, single family home sales throughout Boulder County are UP 25% compared to through May/2011 (1157 vs. 923); attached unit sales are UP 23% (422 vs. 343) for the same time periods; and the overall market is UP 24.72%. The market is still down slightly over 30% when compared to 2005, the benchmark year when sales activity peaked.

            Through May/2012, the Absorption Rate for Boulder County single family homes stands at 7.2 months (219 days). The Absorption Rate is the length of time it would take for the market to sell the entire existing inventory, assuming no new listings came on the market and the rate of sales activity remained the same. The Absorption Rate at the end of 2011 stood at 5.2 months (156 days); 2010 was 6.3 months (189 days). The Absorption Rate characteristically trends downward over the course of the year as sales activity increases during the spring and summer months. Look for that to also happen this year.

            Homes on the lower pricing end of the market ($150,000 to $500,000) always have the lowest Absorption Rate, since that is where the majority of listings and buyers can be found. Through May/2012, the Absorption Rate for this price range stands at 5.2 months (159 days). Surprisingly, the price range showing the most improvement in May/2012 versus April/2012 in days on the market was $700,000 to $1,000,000. That’s a good indication home buyers are moving-up the food chain into more expensive properties. Homes priced over a million dollars still haven’t felt that push yet.

            Looking forward, it appears the Boulder Valley market will continue on a similar plain. The available inventory of resale homes will remain low. An interesting fact, in May/2012 the number of sold properties were nearly identical to the number of new listings, which means available inventory isn’t increasing. Home mortgage interest rates continue to hover below the four percent mark for the traditional thirty-year fixed rate loan. There are no indications the powers to be in Washington are going to do anything soon to upset the financial apple cart.

            New home construction by production builders is reaching a point where “in-fill” lots are being built out, which means development of approved parcels will be their next path. Earth movers will once again be churning-up virgin land, and planning departments will dust off the cobwebs and begin sitting down with developers.

            That light at the end of the tunnel, which for years was simply another train coming our way, now appears to be a gift of sunshine for the Boulder Valley real estate market. The market is still a few years away from mirroring 2005, but at least it is moving in a positive direction.

• 

  Hey, Presidential Candidates: Where are the New Ideas to Fix Housing?

  Fixing the housing market is perhaps the most important step toward fixing the economy, so you would think those who want to win the next presidential election would be talking about how housing creates jobs, the ways consumer confidence is tied to home prices, and what the heck they will do to fix the housing market and turn the economy around. Read

Visit houselogic.com for more articles like this.

Copyright 2011 NATIONAL ASSOCIATION OF REALTORS®

Economic Snapshot for Boulder Valley Real Estate

Economic Snapshot

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

June/2011

            In some obscure way, a healthy real estate market mirrors life; it seeks balance.  It trends toward a market where there are a practical number of homes for sale, an adequate number of home buyers, reasonable mortgage interest rates, and an acceptable level of appreciation in home values.  When all of these elements are in alignment, tranquility exists.  When they aren’t?  Then some degree of confusion and uncertainty prevails.

            The Boulder Valley real estate market has not experienced a “balanced housing environment” for the past few years.  Inventory levels of available properties have declined as many homeowners have decided to either stay where they are and not sell their home or they have rented their home and moved on; themselves often renting somewhere else.  Homebuyers have become less visible these days.  Through May/2011, Boulder County single family home sales are down 18% and attached unit sales are down 34% when compared to the same time frame for 2010.  The overall market is down 23%.

            In today’s real estate market, there are certain considerations at play.  (1) Buyers are bargain hunters.  They want the maximum return on the dollars they are investing in a home.  They don’t want to lose money.  They believe in the old adage, “Buy low, sell high.”, but they aren’t always confident what low is or what high might be.  (2) Price overcomes all objections.  There’s a price where everything will sell, even if the seller needs to bring funds to closing. That’s one of the issues facing the housing industry today; it’s an upside down world.  Many homes are worth less than what is owed on them.  The solutions to that dilemma are to stay the course and hope housing values improve, let the bank have the property or belly-up to the bar at closing with cash in hand, if you’re the seller.  (3)  He/She who has the gold makes the rules.  Mortgage companies and banks are the pathway to the great American dream; home ownership.  Unfortunately, that pathway is strewn with stringent governmental and banking regulations, conservative underwriters and appraisers, and difficult qualifying requirements.  Mortgage rates have continued to hover in the 4.5% to 5.0% range for the traditional thirty-year fixed rate loan.  (4) Seller’s are unrealistic regarding pricing.  Real estate markets are like sifting sand; they change quickly.  New neighborhood sales reflect on neighborhood values.  What sold down the street three or six months ago may not be an accurate representation of what a seller’s home may be worth today.  (5) Consumer awareness is at an all-time high.  Home buyers have immediate access to a plethora of housing information on the Internet.  Some of it isn’t always accurate, but it’s there.  More consumers today begin their search for a home, car, appliances, etc. on-line than ever before.  They do their homework.  When they show-up to purchase, they are educated about the nature of the marketplace.

            On the bright side, homes are continuing to sell.  Median home values for the Northern Colorado housing market have remained relatively stable for the past few years, only off seven (7) percent when compared to 2005 [slightly over one (1) percent per year on average].  Much better than what has happened in some of the bell weather states where double digit depreciation has been the norm.       

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Survey: More Than 70% of Homeowners Say Home Inspection Helped Them Avoid Potential Problems

RISMEDIA, March 3, 2011-Nearly three in four (72%) U.S. homeowners agree the home inspection they had when they purchased their current primary residence helped them avoid potential problems with their home, according to a survey released by the American Society of Home Inspectors (ASHI). Also, almost two in three (64%) noted, in the long run, they saved a lot of money as a result of their home inspection. As the housing market begins to recover, ASHI encourages homeowners and buyers to hire a certified home inspector and to get a home inspection to help further protect their investment.

The survey was recently conducted online by Harris Interactive on behalf of ASHI to gauge current consumer perceptions about the purpose and value of a home inspection. Results revealed 88% of all homeowners believe home inspections are a necessity, not a luxury.

"ASHI's goals have always been to build customer awareness of the importance of a home inspection and to enhance the professionalism of home inspectors," said Kurt Salomon, ASHI president. "It is encouraging to know consumers are listening and understand the significance of protecting their largest single investment, their home."

While it is clear homeowners who had an inspection understand the value it serves, many still incorrectly believe certain components are included in a standard home inspection. For example, septic systems, electrical wiring and plumbing behind drywall and swimming pools are commonly mistaken as items that are included when, in fact, they typically are not.

"ASHI remains committed to educating consumers on what a standard home inspection is likely to include," said Salomon. As such, ASHI members have committed to following a Standards of Practice and Code of Ethics that outlines what consumers should expect to be covered in a home inspection report.

During a home inspection, a qualified inspector takes a detailed look at the physical structure and systems of a house, from the roof to the foundation. A home inspector will examine the condition of the home's roof, attic and visible insulation, foundation, basement and structural components, as well as interior plumbing and electrical systems.

Additionally, nearly three in four homeowners surveyed (70 percent) assume all home inspectors must be certified and licensed, when in fact, not all are. "It is important for consumers to do their homework before hiring an inspector," said Salomon.

For a complete list of what's included in a home inspection, visit www.ASHI.org.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com

Copyright© 2011 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

Economic Snapshot

Economic Snapshot


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



December/2010



The end is near. Another year is about to hike over the horizon and a new year will magically make its presence known. The years seem to slip by more quickly these days as we try to keep pace with the newest cell phone, computer or television. Technology has made things smaller, more efficient and quicker. We would die of boredom waiting for an old IBM 286 to boot up; all fifty pounds of it.

Despite all the changes in technology over the past couple of decades, the purchase and sale of real estate has remained pretty much the same. It is still a hands-on business. Ultimately, all the final decisions are made by humans, not computers.

The pace of a real estate market isn’t defined by the human element, though. Statistics rule here. How many homes have sold this week, this month, and this year? How does that compare with last year or the year before that? Are home values going up or down? How many homes are on the market for sale? All questions requiring statistical answers.

Here are some area statistics compliments of IRES (Northern Colorado MLS). The year 2005 is used as a benchmark, since that has been the most active year for sales activity for the past six years throughout Northern Colorado.



• Boulder County: In 2005, there were 4,193 single family homes sold. For 2010, there will be approximately 2,560. That equates to about a 39% drop in the number of sales.

• Boulder County: In 2005, there were 1,602 attached units sold. For 2010, there will be approximately 1,030. That equates to about a 36% drop in the number of sales.

• Northern Colorado: Through November/2005 there were 26,239 New Listings. Through November/2010 there were 19,724 New Listings. That equates to about a 25% drop in the number of New Listings.

• Northern Colorado: Through November/2005, the Medium Sales Price was approximately $237,500; Average Sales Price was approximately $296,521. Through November/2010, the Medium Sales Price was approximately $230,000; Average Sales Price was approximately $286,704.



Statistics can be confusing at times. They can also be manipulated to represent a specific position. If looked at solely from the perspective of what the numbers are, they don’t lie. So, what do the numbers above tell us?

1. Sales are down noticeably from 2005. They have trended down every year since 2005 for Boulder County, but the numbers for 2010 will be equal to or slightly above 2009 sales figures.

2. The number of active listings has dropped off significantly since 2005. Sellers have decided to (a) stay where they are and not move; (b) wait for the market to improve and then move; or (c) rented their home and moved.

3. Real estate market values have not improved since 2005. In actuality, they have dropped slightly overall. The upper end of the market i.e. over $600,000 has experienced the greatest negative impact from the economy. The lower end of the market has sustained itself.

4. Finally, the Boulder County single family Absorption Rate for 2005 was 7.5 months. Through November/2010 the Absorption Rate is 7.06 months.