by neil kearney | Aug 5, 2010 | Boulder County Housing Trends, Statistics |
Real Estate Sales Dip Sharply In July
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The numbers are in for July and they aren’t pretty. Many wondered if the First Time Homebuyer Tax Credit had an impact on the market and I can now say emphatically, yes! Real Estate sales in July dropped 40% compared to July in 2009 for all residential properties and 26% for single family homes. Quite a drop for mid-summer. As you might recall the original deadline to close on tax credit eligible transactions was June 30th. This deadline led to a pretty serious hangover in July.
How do we look going forward? Good question. From what I can see, we have stabilized for the moment and have drawn a new baseline of activity (not great but acceptable). This will change when one of the following happens: interest rates change (once the signal is given that 4-5% interest rates are on the way out buyers will hurry to take advantage) and true, widespread economic recovery. In my view the economy has been sideways for a long time. Not a lot of hiring, spending or investing going on and not much will change in the Boulder area real estate market until we see real improvement in the economy.
For historical Boulder Real Estate Statistics check out my statistics tab.
by neil kearney | Jul 22, 2010 | Boulder County Housing Trends, Statistics
What is happening in the Boulder real estate market? That’s a tough question but I think I will answer by giving some perspective.
The normal cycle for selling homes in the Boulder Colorado starts slow in the winter, then activity picks up during the spring until it reaches its peak in May or June. After the peak we usually go in a stair step pattern back down to the holidays. The shape of the sales curve during most years is a bell curve. This picture only includes sales so for contracts written you must move the curve to the left 1 month. So where does this put us now that we are in the last week in July? By all accounts we have reached our peak for the year, the only question is how strong the rest of the year will be.
Interest rates are incredible and any buyer who is sitting on the fence worried about the state of the market will be kicking themselves if they don’t take this opportunity. NOW is the time to act!
The chart above shows weekly activity in the Boulder County real estate market since April of 2009. Here you can see the cycles of accepted contracts in blue and closed sales in red. I have highlighted the time frame of late June to late July during 2009 and this year so that it is easier to compare market activity. This year after reaching a climax in contracts on April 30th (end of tax credit) we have seen a sudden a sharp drop which has now stabilized at about 70 contracts accepted in any given week. This is about 10 below last year.
Another measure of if houses are selling is under contract percentage. The higher the percentage, the more activity in the market. As a rule of thumb anything above 15% is considered healthy and strong. Here are some current market statistics for Boulder County.
- All price ranges – 12% of active homes are under contract.
- $400,000 and less – 13.7% of active homes are under contract.
- $400,000 – $800,000 – 13% of active homes are under contract.
- $800,000 – $1.2 million – 8% of homes are under contract.
- Greater than $1.2 million – 4.2% of active homes are under contract.
- City of Boulder – 12.3% of active homes are under contract.
So the answer to the question ‘Are Houses Selling in Boulder County?’ is yes! There is still market activity but frankly I’m surprised more buyers are not taking advantage of fixed rates that start with a “4”.
by neil kearney | Jul 19, 2010 | Boulder County Housing Trends, Statistics
One of the most common questions of potential home buyers and sellers in Boulder County is “have homes appreciated or depreciated”. The best way to answer this question is to have me or another qualified Realtor out to your house to do a comparative market analysis. But many people are not that serious and are just curious how their biggest investment is faring in today’s tough real estate market.
The next place people seem to look is Zillow.comor other online home price estimation tools. Easy, absolutely! Accurate, not so fast. To see more on the accuracy of Zillow, take a look at a previous blog post of mine titled “How Accurate is Zillow?” The gist is that on a bulk basis their algorithm seems to work pretty well but on an individual basis the value quoted I have found to be quite wrong.
Another tool which I find interesting is the “Home Price Calculator” on FHFA’s website. This tool asks for two inputs; the price of the house at time of purchase and the quarter in which a house was purchased. The tool then takes the average appreciation for the whole metropolitan area in which the house sits and gives you a value to the nearest quarter.
Let’s look at this a bit more closely to see how well it works. I chose 3 properties at random from today’s sold list. The only criteria was that they needed to have been sold at least one other time since 2006.
Property 1: 207 Iroquois Boulder, CO 80303 – Sold May 2002 for $362,500 and sold again for $415,000 on July 19, 2010.
The actual appreciation was 14.5% and the predicted price appreciation was 15.4%. Here is a screen shot of showing the estimated value of $418,199. Very close to the actual of $415,000. The predicted annual appreciation for this Boulder house was an average of 1.9%. The actual annual appreciation was 1.8%.
Property 2: 227 Springs Cove Louisville, CO 80027 – Sold for $277,000 in April of 1998 and then sold again for $453,000 on July 16, 2010.
In this case the actual appreciation was less than the model expected. Actual home appreciation was 63.5% or 5.29% per year. The predicted appreciation was 71% total or 5.9% per year.
Property 3: 6156 Willow Lane Boulder, CO 80301 – Sold for $177,500 in December of 2002 and then sold again for $199,500 on July 10, 2010.
The appreciation of this Gunbarrel condo again matched closely to the predicted model. Actual average home appreciation was 1.7%, predicted appreciation was 1.8%.
This tool seems to work well but it does have limitations. I tried to chose houses that did not have any major upgrades. The model does not allow for any upgrades, therefore it doesn’t account for any increases in value in comparison to the average.
As always, the current price is what a willing buyer pays a willing seller. As a Realtor I can’t change market value but I can provide you the best information and marketing so that you can maximize your proceeds.
Quick Fact: Average annual home appreciation in Boulder from 1993 – 2009 = 11.1%
by neil kearney | Jun 30, 2010 | Boulder County Housing Trends, Statistics |
The sales statistics for the Boulder Colorado area continue to be strong but closings are only part of the story. Real estate transactions have a lag time and this months closings are a result of past months activity. We are just a day away from the original closing deadline for the tax credit so the stimulus effect officially ends this week.
It looks as though we were helped immensely by the tax credit but as it expired our market slowed down again. Showings seem to be down quite a bit but what is dramatic and telling is the under contract percentage. Here is breakdown of under contract % by area:
The activity has dropped in every local locality since early May. Most dramatic are 12% drops in Louisville, Lafayette and Longmont. Boulder dropped 11%. Not a very good indicator for the coming months.
The table above shows the under contract percentage in Boulder County by price range. Not suprisingly, the largest decrease was in lowest price range where the tax credit had the most effect.
Here is the data with a few more dates in a visual format.
