The first four months of 2010 were just what we needed in the Boulder area real estate market. The federal homebuyer tax credit, low interest rates and an uptick in overall economic optimism led to a surge in activity. The likes we had not seen for a number of years. It wasn’t record breaking stuff but it certainly got us out of the spiral of declining activity which started in August of 2007 and continued until sales on a monthly basis were consistently 40% below what they had been back in 2004.
Through May (numbers not quite final), sales of residential property in Boulder County were up 32% compared to the first five months of 2009. A good result of healthy activity.
As I mentioned before, our market so far this year has stood on three pillar: tax credit, low interest rates and increased economic fundamentals and optimism. Well, the tax credit has now expired and we are now seeing how strong the two remaining pillars really are.
First for my unquantifiable testimony. I have been busy, quite busy in fact. But I would be fibbing if all of my time has been spent writing and negotiating contracts. I have been meeting with potential sellers, signing up listings, preparing marketing materials, updating and creating websites, showing houses, counseling buyers, etc. Generally doing the activities that lead to future contracts and closings. My listings have been getting fewer showings lately and the volume of the general buzz has decreased. We are finding our new, post tax credit baseline and this level I believe is above where we were but still not back to where we would like to be.
Now to a few quantifiable measures of actvity. The attached charts show three measures of activity: showings, contracts and closings. The first chart in the presentation (view full screen for best viewing), shows real estate activity in Boulder County on a weekly basis. The red line shows the number of closings during any given week and the blue line shows the number of properties that went under contract during a weeks time. You can see that there has definitely been a drop off in contract activity since the April 30th expiration of the tax credit. Closings are still holding strong and because of the lag time of a typical real estate transaction between contract and close, I expect June’s numbers to be reasonably strong as well. But we may have already hit our peak for the year. Time will tell.
The second the third chart present showing activity for my office on a monthly basis. I track gross showings and the number of showings per active listing on a daily basis and then average it out for the month. The total number of showings decreased 27% in May (compared to April) and the number of showings per listing decreased from 9 in April to 6 in May. Some listings got much more than six and some unfortunately had fewer than six buyers take a look.