A tale of two markets emerged in November, as Boulder County’s single-family home sales skidded to a stop, while townhomes and condos took a significant leap forward.
Single-family home sales in the Boulder-area markets dropped 14.4 percent in November compared to October —310 vs. 362 homes—while condominium and townhome sales rose 14.5 percent—126 units vs. 110.
Yet when data for 2018’s first 11 months is considered, the two markets tracked closely together, and both appear to be slowing, according to Ken Hotard, senior vice president of public affairs for the Boulder Area Realtor® Association.
“This is the first month single-family home sales fell below last year, and condos and townhomes are only slightly ahead,” Hotard explains.
Year-to-date through November, sales of single-family homes decreased 1.4 percent compared to the prior year with 4,205 homes sold vs. 4,266. Attached home sales over the same period improved 3.3 percent – 1,445 vs. 1,399 units sold.
Inventory decreased in both housing categories, though more significantly for single-family homes, which dropped 13.1 percent in November compared to October with 821 vs. 945 Boulder County homes for sale. Condo/townhome inventory fell 6.1 percent in November compared to the previous month with 263 units for sale vs. 280.
“My guess is the growth of the townhome/condo market is due to a larger inventory and more affordable pricing,” says Hotard. “Interest rates are making people jumpy, but the reality is that mortgage rates are still historically low. The more complete view is the inventory and pricing dynamics of the Boulder-area markets.”
He notes that single-family home sales could recover in December, but it’s not likely.
“We have the ongoing headwinds of low inventory and rising prices. When we look back, we’ll see 2018 as market slowdown for housing in our market areas,” Hotard predicts.
Despite the slow-down in housing, Colorado’s economy continues to show strength, wage growth is increasing, and gross domestic product is up, according to recent news reports.
“What the Boulder-area needs is more housing that is desirable and more affordable for people,” adds Hotard.
If there is one constant in Boulder Valley, it’s a strong real estate market. October’s sales statistics show 2018 is on track to finish strong. This is despite that month-to-month, those statistics sometimes show significant fluctuation.
Take September and October 2018. When compared to October, September’s data is like Colorado weather: If you don’t like the statistics one month, wait a month, they are likely to change.
September’s single-family sales dropped 20 percent, then recovered to gain 8.7 percent in October with 362 homes sold vs. September’s 333. Despite the short-term fluctuation, year-to-date sales are holding steady through October, reaching just one unit short of the same volume as last year – 3,880 vs. 3,881.
“It’s hard to characterize our market here in Boulder County. Given all of the factors, it can be difficult to decipher trends as opposed to an event,” says Ken Hotard, senior vice president of public affairs for the Boulder Area Realtor® Association.
“While the swings add volatility to the market, the market exhibits good health with strong demand, and prices and sales holding steady,” he says, adding that a strong economy and job growth continue to be drivers.
Condo/townhomes in Boulder County saw a month-over-month sales decrease of 5.2 percent, with 110 units sold in October compared to 116 in September. Year-to-date attached dwelling sales rose 4 percent through October – 1,317 vs. 1,266.
October’s inventory for attached dwellings also increased 7.3 percent over September with 280 units available in October compared to 261 the prior month. Single-family home inventory declined 10 percent, with 945 homes available for sale in October compared to 1,050 in September 2018.
Hotard projects November and December sales will be “anybody’s guess depending on the weather. But all things being equal, I don’t expect much change through the end of the year.”
The next big change he expects will be in early 2019. “I think we’ll see a big increase in inventory and sales in February and March. I think people will look at taking the gains we have seen in this market, providing inventory and set the market up for pretty strong increases in the big home selling months.”
Colorado Springs’ 80922 zip code is the No. 2 spot hottest zip code in the country – moving up from No. 7 in 2017, according to analysis of 32,000 zip codes by realtor.com®.
The annual analysis of zip codes looks at how long it takes homes to sell and how frequently properties in each zip code are viewed to determine which zip codes are most popular and fastest moving.
Greeley’s 80631 and Broomfield’s 80021 zip codes also ranked in the top 50 hottest, coming in at Nos. 44 and 48 respectively.
High-income millennials helped fuel a 10 percent rise in how fast homes sold in popular areas in 2018. More and more millennials are getting older and buying homes, which realtor.com says is driving demand in smaller, more affordable suburban areas. These 25- to 34-year-olds are attracted to affordability, strong local economies, and outdoor and cultural amenities.
The number of households in Colorado Springs grew 21 percent from 2010-2018. Homes in El Paso County sell in 15 days with a median list price of $297,811 – an increase of 9.7 percent in the last year. Located 60 miles south of Denver, Colorado Springs offers lifestyle features millennials want – outdoor activities, popular local breweries, and more affordable housing than Denver.
Here are the top ten hottest zip codes in the U.S.
Homes in the top 10 hottest markets sell in 20 days on average, 46 days faster than the rest of the country, 25 days faster than their respective metro areas, and 18 days faster than their respective counties.
In eight out of the top 10 ZIPs, millennial median household income is 1.3 times higher than the national median, $78,000 versus $60,000, respectively. Mortgage originations in nine of the top 10 counties are millennial-dominated with 34 percent of mortgage originations.
For the full report visit https://www.realtor.com/research/hottest-zip-codes-2018/
Home sales in Boulder-area single-family and attached housing markets rose in August along with the late summer heat index.
Single-family home sales increased 10 percent in August 2018 compared to July with 460 homes sold in Boulder-area markets vs. 418. Sales for condominiums and townhomes climbed 15 percent with 146 units sold vs. 127.
Meanwhile, Denver-metro home sales went in the opposite direction, slowing significantly over the same period, according to the Denver Post.
It’s testament to the state of Boulder Valley real estate market, according to Ken Hotard, senior vice president of public affairs for the Boulder Area Realtor® Association.
“We have our own little market here. While Denver dipped, Boulder Valley showed strong growth in sales, despite ongoing rising prices and inventory squeeze,” says Hotard.
Year-to-date sales also continue to climb steadily. Single-family home sales grew 1.7 percent through August 2018 compared to last year – 3,154 homes sold vs. 3,100. Attached homes followed a similar track, improving 1.6 percent year-to-date – 1,154 sold in 2018 compared with 1,135 in 2017.
Inventory dropped 2.0 percent for single-family homes – 993 units in August 2018 vs. July’s 1,013. But condo/townhomes available for sale grew 11.2 percent with 268 units available in August vs. 241 the previous month.
Hotard attributes the unceasing increase in real estate sales and prices to the area’s strong economy and continued job growth, along with a desirable quality of life. “Significant companies are hiring in Boulder, like Zayo, Google, Twitter – and the natural foods industry is strong,” he adds.
Interest rates are slowly pushing upward, which traditionally results in a slowdown in rising home prices and sales. But Boulder Valley’s housing market may not readily respond to interest rate increases.
“It’s unknown what the tipping point is for interest rates affecting our housing market. And with 35 percent of Boulder County homes bought with cash, rising interest rates may not have a significant effect locally,” says Hotard.
Looking ahead to the final quarter of the year, Hotard expects sales to continue to match those of last year, unless “something unusual happens.”
“We seem to be operating on an upward trend and it’s hard to see what would stop it. The real challenge for Boulder County is providing the housing and transportation infrastructure to support job growth.”
Boulder-area housing continues to reach new heights, shrugging off a pullback in July sales.
“Prices in Boulder Valley are at an all-time high in both single-family and attached homes. Also inventory challenges are ongoing. Despite both of those realities, housing demand is absolutely holding,” says Ken Hotard, senior vice president of public affairs for the Boulder Area REALTOR® Association.
The City of Boulder July average sales price reached more than $1.3 million – a 15.4 percent increase for the year. Median price hit $984,648. While Boulder’s prices are the highest, every area in Boulder County saw an increase in average sales price ranging from 3.5 percent in Superior to 17.7 percent in Niwot year-to-date.
However, July sales slowed from the previous month, following the typical late summer pattern of a month-over-month slowdown. Sales declined for single-family and attached homes in July compared to June, 2018. Single-family home sales in the Boulder-area markets dropped 16 percent—418 vs. 498 units—while condominium and townhome sales fell 32.8 percent—127 units vs. 189.
Hotard says this year’s July slowdown is a little more pronounced than last year.
Even so, year-to-date single-family home sales were virtually unchanged with a 1.0 percent increase compared to the prior year with 2,666 homes sold compared to 2,639. Attached home sales over the same period improved 5.8 percent; 914 vs. 864 units sold.
Inventory held its own. There was essentially no change in single-family home inventory levels, which rose .8 percent across Boulder County in July compared to June, 2018 with 1,013 vs. 1,004 homes available for sale. Condo/townhome inventory grew 1.3 percent in July compared to the previous month with 241 units for sale vs. 238.
Hotard notes there is potentially downward pressure on the market with interest rates trending upward and prices rising faster than wages in the area.
“But with demand as it is, we’re just going to keep moving forward,” he says.
Hotard adds that real estate is a “dynamic industry and Realtors are responding to the challenges by continuing to advise their clients on successful strategies for selling and purchasing homes.”
Nine Colorado cities rank in the top 50 best cities for first-time home buyers, according to recent analysis by WalletHub, a personal finance website. Four of those made the top 20 – Centennial, Thornton, Arvada and Greeley, coming in at Nos. 3, 6, 17, and 20, respectively.
With home prices rising in Colorado and across the nation, buying a first home is challenging. Potential buyers need to develop a realistic perspective on market prices, their financing options, and neighborhoods that have a good reputation and appeal to their lifestyle.
To help potential buyers target possible locations, WalletHub compared 300 cities of varying sizes across 27 key indicators of market attractiveness, affordability, and quality of life. Data includes important factors like cost of living, real-estate taxes, and property-crime rate.
Here are the rankings of the Colorado cities reported:
25. Fort Collins
27. Colorado Springs
Among those cities, Colorado Springs has the fourth-lowest real estate tax rate in the nation.
First-time home buyers are often in the millennial generation. As it turns out, Colorado is the ninth-best state for millennials, according to a separate WalletHub report.
Millennials – those born between 1981 and 1997 – make up over 35% of the workforce. While often thought of as “kids,” the oldest are 37 years old.
In addition to a total score of 9, Colorado ranks high for quality of life (7), economic health (3) and civic engagement (10). No. 1 ranked District of Columbia also ranked first in the nation for quality of life and civic engagement.
Colorado was evaluated along with all 50 states and the District of Columbia across 30 key metrics, ranging from share of millennials to millennial unemployment rate to millennial voter-turnout rate.
Here’s a look at the top 10 states for millennials:
For more information, see the full reports at https://wallethub.com/edu/best-and-worst-cities-for-first-time-home-buyers/5564/#methodology and https://wallethub.com/edu/best-states-for-millennials/33371/ .
Posted by Tom Kalinski Founder RE/MAX of Boulder on Friday, August 24th, 2018 at 10:36am.
In this day and age, one could be forgiven for wondering if facts no longer matter or actions no longer have consequences. Whether one watches the national news or a local city council study session where members declare that they want fewer visitors (both tourists and locals from neighboring cities), it is clear we are living in strange times.
Despite all of the uncertainty, there are still a few facts left out there (at least where real estate is concerned), and from them we can draw some reasonable inferences.
1. Home prices throughout Boulder Valley are reaching all-time highs.
At the top of the list, the average single family home in:
- Boulder now costs over $1,250,000
- The suburban plains now costs almost $850,000
- Louisville and the suburban mountains now cost over $750,000
- Boulder County now costs $767,000
Likewise, the average attached home in:
- Boulder now costs over $540,000
- Louisville now costs over $400,000
- Longmont now costs over $350,000
- There are no places left in Boulder County or Broomfield where the average condo is less than $340,000.
2. Local housing inventory is at historic lows
The inventory of homes throughout Boulder County is at or near historic lows..
At the end of June, there were 858 single family homes on the market in Boulder County. To add some perspective, the inventory of homes on the market at the end of June 2006 was 2,763, more than three times as many homes as there are now. There are many reasons for this, including the fact that people are choosing to stay in place longer, increasing prices/lack of affordable places to move to, strong anti-growth policies, etc. Looking at the economic, political and structural factors at play, it appears that this scarce inventory is going to be the new normal.
3. Despite the high prices and low inventory, demand remains high
We gauge the strength of demand for homes using several indicators, including months’ of inventory, the average time a home spends on the market, and the number of expired listings (homes that failed to sell on the market).
Economists say that a balanced housing market has about six months’ of inventory, with more inventory being a buyer’s market and less being a seller’s market. At the end of June, Boulder County had about 3.3 months’ of inventory, compared to 3.8 at this time last year. In the first half of 2016, the average home spent 65 days on the market (from listing to closing). So far this year, that average is 57 days, 12.3 percent faster. Last year at this time, there were 33 expired listings, compared to only 26 this year, which is a drop of 21 percent.
Taken together, these factors demonstrate that demand is getting stronger, even in the face of rising prices and declining choices. And when you consider net migration to our area and plentiful jobs, it also appears that demand will keep increasing and homes will continue to appreciate until . . . when?
What is it that will cool our market and when will it happen?
There are several issues that have the potential to slow our market. First, interest rates continue to rise and as they do they will drain buyers’ purchasing power. Second, as prices have risen faster than wages over the last decade, there may come a point where home prices have to stall in order to allow buyers’ savings to catch up. Third, a macro-level event, such as a recession, international war, etc., could cool the entire economy and affect our market.
The set of variables is too complex to predict accurately what the precise cause(s) will be or when it will come, but it will come. The good news (if you own real estate here) is that there is no better place to invest in real estate than here — even in a downturn.
Jay Kalinski is broker/owner of Re/Max of Boulder.
Boulder County housing sales in May rolled strong once again, demonstrated by sharp growth in the single-family home market and solid performance for attached dwellings.
“Gains in single-family home sales topped 40 percent – a really strong increase that was backed by inventory growth,” says Ken Hotard, senior vice president of public affairs for the Boulder Area Realtor® Association.
In fact, all categories of single-family homes surged, according to May 2018 statistics. Sales of single-family homes grew 41.2 percent in May 2018 compared to April, with 487 homes sold vs. 345. Year-to-date single-family home sales increased 5.6 percent year-to-date through May 2018 compared to the prior year – 1,708 vs. 1,618. And inventory countywide increased 19.1 percent month-over-month with 918 units for sale in May vs. 770 the prior month.
Condominium and townhome sales grew a solid 14.3 percent in May compared to April, represented by 144 units sold vs. 126. Year to date, growth was 23 percent – 594 units vs. 481. Inventory increased 27 percent in May compared to April, putting 208 dwellings in the May marketplace compared to 163 in April.
Hotard says prices moderated slightly in May. Single-family average and median sales prices dropped compared to the previous month. “The median in April was over $1 million, now it’s down to $985,000; and townhome/condos were in the $500,000’s last month and are now in the $450,000’s,” he adds.
The steadily increasing housing market is a sign of strong fundamentals – demand is strong, inventory tight and jobs plentiful. Currently, Boulder is the third largest job center in the state. “But with housing prices too high for the average worker and no new building in sight, we can expect to see jobs that would have located in Boulder County opt instead to land somewhere along I-25,” explains Hotard.
Looking forward, he says June data seems to be tracking solidly along with May.
“We should see a shift in the market as we get to the end of July. I expect it to slow down a bit, but we can expect much of the same.”
He adds that the number of days a home is on the market is short. “Any buyer in this market has to walk into house-hunting ready to buy with a knowledgeable realtor and financing lined up.”
Originally posted here by Tom Kalinski Founder RE/MAX of Boulder on Wednesday, June 27th, 2018 at 11:03am.