From January through December, is there a best time to buy a home in Boulder County and nearby communities? Of course it depends on your specific needs and on the types of homes you are looking for, but the long-term historical Boulder real estate data can help answer this question.
Boulder Area Home Prices Increase More in the First Half of Each Year
When people hear that house prices are going up 12% a year, it sounds like they are going up 1% a month over the entire year. However, that’s not really how it works. In a market where prices are surging, nearly all the price increase occurs between January and June. So, when we have a 10% price increase, a house that sold for $500,000 house in January would sell for $550,000 by the end of June.
For clients who are starting their house hunt in December or January, we recommend they focus and try to find a good house quickly. That strategy may save them between 5% to 10% on their purchase price.
There is a caveat though. From 2013 through 2017, median house prices for sales closed between January and June were higher than median prices for comparable houses closed over the year as a whole. That is, the prices of homes closing from July to December actually dropped. This phenomenon brought the median prices down for the year when compared to January to June prices. Take a look at Agents for Home Buyers median home prices for the Boulder area since 1997.
Average Price Increases for Homes in the Boulder Area
If we look at the average price increases for mid-sized homes from 2013 through 2017, for example, full year data shows an average price increase of 8.7% year on year. But if we drop the sales data from the second half of each year, comparing median prices only for the January/June period to the median prices for the prior year, that 8.7% increase turns into an average of 9.4%. This happens with small houses and with condos/townhomes as well. For small houses, full year median prices average a 9.4% increase from 2013 through 2017, while January to June prices show an 11.3% increase over the prior year.
Prices for Condos and Townhomes in Boulder County
For condos and townhomes, full year data show a 10.2% increase year on year, where the January to June increase comes in at 12.5%. Fall prices actually drop 2-4% over spring prices to produce these lower prices for the year as a whole, even though they are still substantially higher than prices for the prior year.
Real World Experience
While surprising, these data make sense to anyone who’s been trying to buy a home in our area since 2013.
In the spring, buyers in the lower half of our market are typically competing against 5-15 other offers any time they attempt to buy a listed home.
In the fall, we typically have either no competition when we submit offers, or we’re competing against 1 or 2 other buyers.
This removes the pressure to submit offers that are $10K-$25K over list price, and in some cases, even allows buyers successfully submit offers that are below the asking price. This also means that listing agents and sellers get less aggressive with their initial asking price. The outcome is a drop in market prices relative to spring pricing.
So What’s the Best Time to Buy a Home in the Boulder Area?
Well, it depends on your needs. If you’re flexible, the best time to buy a home in our market is before prices rise again in the January-through-June time period. If you need a place soon, then don’t wait too long.
Need help getting started? Contact us and see how we can help.
