- For the third consecutive month, existing home sales rose
- Inventory is easing
- Home prices declined less sharply in June
The report noted, “Existing home sales…increased 3.6 percent to a seasonally adjusted annual rate of 4.89 million units in June from a downwardly revised pace of 4.72 million in May, but are 0.2 percent lower than the 4.9 million-unit level in June 2008.
The report also revealed, “Total housing inventory at the end of June fell 0.7 percent to 3.82 million existing homes available for sale, which represents a 9.4 month supply at the current sales pace, down from a 9.8 month supply in May. Raw inventory totals are 14.9 percent below a year ago.”
The Wall Street Journal reported Thursday a look at 28 major real estate markets and where they are headed. The results (http://online.wsj.com/public/resources/documents/retro-HAGERTY.html) were interesting for Denver:
- A 19.6% decline in housing inventory (from a year ago)
- We are currently at a 6.1 month supply
- We’ve seen an 8.3% drop in price since the peak
Also interesting to note this week is the fact that Denver was named the No. 1 city where Americans are relocating, according to Forbes.com (http://www.forbes.com/2009/03/30/americans-moving-cities-lifestyle-real-estate-relocating.html?partner=email).
Among the highlights of the story:
- Population increased by 2.17% in 2008; it increased 2.09% in 2007
- Denver was the 10th fastest growing metro area in the United States
- Denver is the most popular city in America; people like it for its skiing, culture and vibrant nightlife as well as its business opportunities
- As of January 2009, the metro area’s unemployment rate was 6.5%; that’s high but still two percentage points below the national average of 8.5% for the same month
What all of this leads us to believe is despite some of the challenges we continue to face nationally and globally, the domestic housing market continues to demonstrate signs of recovery. The temporary first-time home buyer tax credit is clearly helping people make a decision and is contributing to the overall stimulus impact.
Are we out of the woods yet? It’s tough to say but the signs are encouraging and three months of continued increases in home sales are a positive sign that we may be on the road to recovery.
And with that news in tow, let’s take a look at this week in real estate:
- Boulder/Longmont—The Boulder County market showed an increase in properties under contract of about 15% last week, the first significant move in several weeks. New listings were exactly the same as the week before. Centralized showings reports a steady, upward trend in showings over the past month, averaging about a 10% increase each week. Agents continue to report frustration with short sales. Our Agents are all on the same page, but other brokerages have either different policies or no policies about how short sales should be accomplished. Longmont reports the Boulder County Fair is coming to town and the fairground is located in Longmont, so no excuses about attending! It is a community event and it brings people and revenue to Longmont. Showings were up 14% week over week. Sales and listings are holding steady. The lending process is still quirky at best. Patience is still needed by all for most every transaction. Clean, well priced homes are selling. Buyers with good credit and some money for a down payment are buying. Good Agents are keeping their deals together with some very trying times for all parties. We are still seeing homes under $250,000 moving quickly.
- Evergreen/Conifer—We had two new listings during the week totaling $772,000. Three listings went under contract of which one was bank owned and we had six offers. Two buyers put under contract including one out-of-state buyer from Texas. Our showings increased to fifty one during the week.
- Denver Central—The Denver real estate market continues to get positive national and local press. We continue to have substantial drops in housing inventory in the Denver area and we have seen an increase in the number of existing homes sold. This could indicate that the market has bottomed out and is very encouraging for the future of real estate in Denver. We have had an average 71 days on the market for listings that have gone under contract in July. The lower-end market has certainly shifted to a seller's market with properties moving quickly. Properties that are priced aggressively are seeing multiple offer situations. We had a couple of listings this past week below $200,000 that received 10 plus offers and went under contract for way above list price. Many properties in the lower end go under contract within days of being put on the market. The high end market continues to be tough and we are not seeing as much activity.
- Devonshire—Happy Summer! It is truly a busy market here at Devonshire. Our homes are getting more showings and the homes that are going under contract are the ones that show picture perfect. We are encouraging sellers with "tired" plants to refresh them with new ones so that they have welcoming curb appeal. Buyers are seeing homes go under contract that they would have liked so there is more motivation to get moving. With the school year approaching, buyers & sellers want to get settled in their new homes soon. It is still an issue getting some houses appraised so correct pricing is essential. This type of market makes it especially important for the consumer to deal with experienced professionals in both the real estate and mortage sectors. We are looking forward to an even better August.
- Douglas County—Showings were great this past week and very, very good this past weekend. We had two Agents convert floor calls to buyers. Our lead router Agents are receiving great activity and they are pleased. We are seeing sellers pricing their homes more aggressively in this market and as a result these listings are moving quickly. We are still seeing more activity in the $300,000 and below properties. Open houses were good this past weekend. Several Agents reported that they were able to obtain good leads. Our mortgage rep is busy and that is always a good sign.
- El Paso County—We are anticipating the return of a number of troops to Fort Carson. Although we don't yet know the impact on the demand level yet, this certainly should boost sales later in the year. We are still receiving multiple offers on power priced listings in the lower price range (up to $150,000). About 66% of all listings are either short sales or foreclosures!
- Larimer County—Our Fort Collins/Loveland office reports showings have been slowing the last week, but inventory is starting to build again. Several competing offer situations have been reported as well priced, clean and ready to move homes are selling. We are seeing movement at the lower price point as jumbo loan interest rates are still higher than conventional. This is likely the reason we are seeing home sales at the lower price bands moving as buyers can take advantage of the lower interest rates. CB Home Loan FHA rates are still the best in town.
- North Metro—The average sales price is around $250,000. We continue to see multiple offers on lower priced homes. Inventory in the $200,000 and under market is shrinking and going under contract quickly. Homes listed for over $350,000 have shown a slight reduction in showings in the past few weeks. Our Agents continue to report great turn outs at their Open Houses.
- Parker—After a short slowdown last week, activities have increased on all levels again. We still see a high number of buyers losing properties because of multiple offers as well as multiple offers on our power priced listings. Since the government is trying to implement a new loan structure on Fannie Mae and Freddie Mac loans, and holding back on releasing many bank owned properties into the market for now, we are anticipating a high number of new bank owned listings by the end of August or early September. Sellers are advised to put their homes on the market aggressively very soon in order to avoid competition with bank owned listings.
- Southeast Metro—The SE Metro office is experiencing a steady increase in properties going under contract within the first couple of weeks on the market. We are averaging six showings during the 1st week on all new listings. This weekend, we are hosting an open house blitz with Agents holding over 60 houses open between Saturday and Sunday. All open houses are being advertised in the Denver Post and all Internet sites! Stay tuned for the exciting results of our Open House Blitz.
- West Lakewood—No information reported.
This week I’ll end with a few words of wisdom to our clients:
Pricing and presentation is vital in today’s market. Buyers are paying attention to new inventory and current price reductions so if you want your home to remain competitive in today’s market, you need to consider this fact. I urge you not to test the waters when you place your home on the market. You will prevail if you price your home competitively from the beginning and present it in its best light possible. Listen to your Agent! Once you do this, great opportunities abound.
Until next week,
Chris Mygatt
Coldwell Banker Residential Brokerage Colorado
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