The real estate market in Boulder County is very interesting to study. On one hand we are doing great when compared to many markets, in its latest report FHFA ranked Boulder 17th in the nation in annual appreciation. I am very grateful! On the other hand sales are down to levels we haven’t seen since 2001. What’s up and what can you do about it. Here is a quick snapshot on how buyers and sellers should be thinking if they are looking to buy or sell a home in or around Boulder. I write a monthly statistics column in the Boulder Area Realtor Association newspaper The Realtor Review. Here is my lest entry. Let’s take a look.
Now is a great time to buy a house*. So why are sales in February down 24% from last year? The answer can be found in the asterisk. It is a great time to buy if:
1. You can buy a house and stay within the conventional or FHA limits.
2. You have a job, great credit, plenty of reserves and a letter from your 6th grade teacher.
3. You have confidence that your job is stable and that eventually everything is going to be okay.
4. You haven’t been scared to the point of inactivity by the images in the media; “Lost Trillions in Equity”, “Modesto Neighborhoods Decimated by Foreclosure”, etc.
5. You haven’t lost all of you savings in the stock market. It is easier to ignore and cope for some people than realize and act.
6. You don’t have a house to sell. See #4.
There are many thoughts running through the minds of our would-be clients and not many are positive. The six scenarios above are just a few of the variables in today’s market. Most of these challenges lead to one answer. Good homes in the lower price ranges are still selling!
There are many reasons why people buy and sell. Many of the reasons don’t wait for a better market. What the public needs now is accurate local information.
· There are opportunities out there but our market is holding up very well. Sales price to list price ratio is still above 95% so offers at 60% of list price probably are not going to fly.
· Prices are holding steady. If you’re waiting for a big drop in our market you probably won’t see it.
· Take advantage of interest rates while they are low because all indications point toward our area being on the leading edge of the nation wide recovery.
· Buyer’s have choices so your house needs to be both the best priced and best looking house in its price range. Many homes right now are not selling if they don’t get both just right.
· Now is not the time to put your house on the market at too high a price and wait and see. Be realistic now and save both time and money in the long run.
· Be ready to deal on inspection items. Buyers expect the roof to be in good shape and if there is a puddle under the water heater, replace it – it’s not going to get any better.
· Be patient and vigilant. There may not be many showings, so make each showing count.
The advice here becomes exponentially important as the price range increases. Right now 15% of homes under $500,000 in Boulder County are under contract while only 3% of homes over $1.5 million are under contract. Similarly, the absorption rate for properties under $250K is 4.25 months, between $250 – $500K is 5.71 months, $500 – $750K is 10 months, $750 – $1MM is 14.41 months, $1MM – $1.25MM is 22.73 months and above $1.5MM is 48 months of inventory.