What Type of Properties are Selling in Boulder County?
It’s March and for me that means: March Madness, the beginning daylight savings time, improving weather and the beginning of the spring real estate season. Two of the above can be set to a positive date in advance. The other two are a bit nebulous. The weather is improving and beginning March 1st it felt like a good idea to be spending more time outside. This is of course subject to change.
The spring real estate season. Now that is a moving target. Last year it didn’t start until May. This year it started heating up in February. Through the years I have learned to swim on top of the waves rather than try to stop them. My thought is that you work hard in all seasons, knowing that some will yield more fruit than others.
This year we have the tax credit expiring at the end of April which has brought an interesting dynamic to the market. First time buyers are out in droves. But is the rally limited to properties in the entry-level? The chart below shows the percentage of homes which are under contract across different price ranges. The properties represented are both single family and attached homes in Boulder County.
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Under Contract % Boulder County –
The kelly green bars (it is St. Patricks Day) show the data as of today. Comparing today’s market to a number of dates last year we are looking good. Improvement in almost every price range is the rule. On average 15% of properties are under contract. The range is from 6% for properties priced over $1,750,000 to 28% for properties priced less than $250,000. While there is not as much activity in the upper price ranges, better activity is being seen across all price ranges.
Winter 2010 Newsletter
Here is an excerpt from my latest newsletter which just went out today. To view it fullscreen with all formatting, graphs and photos click here.
Locally, we began to see improvement in the local real estate market in September 2009. A direct result of the Homebuyer Tax Credit which was initially scheduled to expire at the end of November but has since been extended and expanded.
What was designed to be a stimulus for first time homebuyers now includes homebuyers who have lived in their current home for at least five of the past eight years. First time buyers who place a contract on a home on or before April 30th and close on that home on or before July 1st are eligible for federal tax credits in the amount of $8,000. Move up buyers have the same deadlines but the tax credit amount is $6,500.
Sales during the fourth quarter of 2009 were up 17% in Boulder County compared to 2008. During the entire year sales were down just under 15%.
So far in 2010 the early year activity has been strong. Buyers and sellers, who traditionally wait for spring have been spurred on to a winter start by the tax credit and low interest rates. Showings in our office are up considerably and contracts on homes have picked up dramatically in February.
We all know that interest rates are a very important piece of the home buying process. A one percent rise in interest rates can make a huge difference in the affordability of a house. During this difficult economic crisis we have been lucky to have had interest rates in the 5% range. This will not last forever. In fact, the Federal Government has kept down interest rates by buying mortgage backed securities. The money for this program is nearly out. By the end of March, many experts expect rates to begin to rise. If you have been considering a purchase or a refinance, now is the time! The attached chart shows mortgage interest rates since 1972. Right now is the bottom.
While our market has not been stellar over the past few years, it is good to keep the relative strength in our market in perspective. The national media focus have been on the markets that have been the hardest hit. Our local market has been much more stable. It would be a much different scenario locally if home values would have dropped significantly. As it stands, we are down just a few percentage points over the past few years and relatively few homeowners who put down a 10-20% down payment are “upside down” in their mortgage. See the chart below to see the strength in our local market over the past three years. Boulder County continues to be a good place to invest and own real estate.
Boulder Real Estate – February 2010 Statistics
Boulder Real Estate February 2010 Statisticshttp://static.slidesharecdn.com/swf/ssplayer2.swf?doc=february2010statistics-100307194113-phpapp01&rel=0&stripped_title=boulder-real-estate-february-2010-statistics
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The slideshow above highlights the monthly statistics and market trends for residential real estate in Boulder County. Slides include: total sales, median price, under contract percentage and weekly activity. For best viewing choose the full screen option near the bottom of the first slide.
Early Activity in the Boulder Real Estate Market
So far, it has been an interesting year in the Boulder area real estate market. It feels very different than a year ago, for the better. More activity, more showings, more calls, more plans, more positive expectations… However, after looking at two months of data we are just a touch ahead of last year in terms of properties closed.
Here is what I think is going on. We are busy setting the foundation for a surge that will correspond with the expiration of the homebuyer tax credit. We are already seeing its effects but as the deadline draws near buyers will stop shopping and start buying. This should happen by the end of March. If you don’t recall the basics of the tax credit see my previous post on that subject. Even if you have already filed your 2009 taxes you can do an amended return and see that money this year!
Here is a chart showing the activity in the local market on a weekly basis. You will notice that there was a surge in closings this past week. This is fairly normal at the end of each month.
Boulder Home Appreciation Ranks 82nd Nationally
The Federal Housing Finance Agency released released their 4th quarter home price index today. Boulder County is one of the 299 Metropolitan Statistical Districts (MSA’s) that are tracked and ranked in terms of home price appreciation (or depreciation). Boulder ranked 82nd out of the 299 tracked areas in terms of 1 year appreciation ending December 31, 2009. The one year return was -1.45%. For the 4th quarter the appreciation was .18%.
Nationally the overall appreciation during 2009 was -1.21%. Colorado ranked 2nd in the U.S with a 3.07% increase. The top MSA over the past year was Terre Haute, Indiana whose one year return was 3.11%. The largest depreciation was seen in Bend, Oregon at -20.55%, closely followed by Las Vegas, NV at -19.30%.
The chart below shows the home appreciation in Boulder compared to that of the United States as a whole.
For more graphs including four year accumulated appreciation of selected markets and how Boulder has ranked nationally since 2006, click here. For a list of the top and bottom 20 areas for home appreciation and a full list of all 50 states ranked by 1 year home appreciation, click here.
Neil Kearney MBA
Broker/Owner
Kearney Realty Co.
303.818.4055