A4HB Homebuyer's Blog

Speed of Sale Data Reflect Nightmare Market for Buyers

Speed of Sale Data Reflect Nightmare Market for Buyers By Norris Minick We have lots of detailed data on the web site tracking how quickly properties go under contract once they’re listed on the MLS.  These data, which  show what percentage of listed properties go under contract within 5 days of listing and within 14 days of listing, give us a very good measure of the intensity of buyer pressure on various property type in various communities. The Global View Sometimes it can be useful to step back and take a more global view of the data.  In the chart

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Peak Pressure on the Market: What Time of Year?

Since 2013, we’ve had more buyers than sellers in our market, resulting in multiple offers on many listed properties and rapidly rising prices.  While there has been some variation from year to year, our experience is that buyers are facing the most intense competition for properties between mid-January and June, and that the market has softened some as we get into July and August.  If we could get the data, we’d love to look at how many offers are being made on new listings at different times of the year.  This year, for example, our buyers in Feburary through May

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Affordable Condos Drop out of Mix in New Construction

For the past 4 years, the Colorado legislature has considered legislation that would reduce make it more difficult for condo owners or HOAs to sue builders for construction defects.  This is a response to legislation that facilitated such lawsuits, and claims that builders have effectively quit building condos because that legislation increased liability as well as insurance and financing costs.  Since the state legislature has failed to pass any “corrective” legislation, a dozen communities along the Front Range have, in an effort to stimulate condo construction. The graph below, produced by Metrostudy, illustrates the nature of the problem: Briefly, where

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Drop in New Construction: Major Factor in Tight Market

Anyone who’s tried to buy a home in the Denver/Boulder region since March of 2013 knows that there are more buyers in this market than there are homes to buy.  There are a number of factors contributing to this, but the collapse in the building of new homes during the recession certainly contributed.  The chart below tracks the number of new building permits issued from 1985 through 2014 for Boulder County and the adjoining counties that define our housing market.  You don’t need a Ph.D. in statistics, or powerful analytic tools, to notice the numbers slipping off a cliff in

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When Do Price Increases Occur?

When deciding when to buy a home, its not uncommon for buyers to start up a year earlier than they’d otherwise like to when they’re in a market where prices are rising quickly.  Why wait a year to buy when 10% price increases could make a $400,000 house cost $440,000 by next year…or make me pay $400,000 for a house that I could have gotten for $350,000 earlier?  Even more significant for many buyers, however, is whether it would make any difference if I found a home to buy in January rather than April.  That is, in a market that’s

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Investment Properties

U.S. homeownership rates hit their lowest percentage on record in July at 62.9%. The major contributing factor in the low mark is millennials waiting longer to purchase their first home when compared to previous generations. Increased student debt, delays in marriage, waiting to have children and rising prices are all weighing on the younger demographic. This dynamic has naturally impacted rent and vacancy numbers across the state. According to the Colorado Department of Local Affairs quarterly survey, vacancy rates state-wide have been declining since the 4th quarter of last year while the average rent reached an all-time high of $1,292.50

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Hints of Some Improvement in Housing Inventory

Low inventories of homes for sale are combining with high rents and increasing populations to drive up housing prices in Boulder County and the Denver Metro area.  During the recession, the number of new listings and the number of houses on the market (inventory levels) dropped dramatically.  At the time, we assumed that inventories would return to normal once the recession ended, but for both houses and condos/townhomes, the number of new listings and inventory levels continued to drop further after the recession ended (in the housing market) in 2012. For more data on this on our web site, on

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Historic Low Interest Rates Facilitate Price Increases

Interest rates are probably supporting the current price increases in our housing market, since they remain at or near historic lows, with 30 year rates at about 3.75% and 15 year rates at around 3%.    These rates have held in this range for almost 5 years now, bumping up about 1/4 point in 2014. At current rates, a $2,000 monthly principle and interest payment allows a buyer to borrow about $430,000 to $440,000, where a similar payment in 2003-2005 would have covered a $340,000 loan…and for much of the 1990s…$270,000 to $280,000.  Check out the following chart for perspective

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Is the Denver/Boulder Market Blowing a Price Bubble?

“The only function of economic forecasting is to make astrology look respectable.”  ……..economist Esra Solomon Market forecasts tossed out by real estate agents should be taken with a truckload of salt, but our clients want to know what the future holds for housing prices and investments, so we try to provide some perspective when we can.  And the perennial question we’re asked any time we’re seeing price run-ups like the one we’re seeing now  is whether we’re in a bubble that’s likely to pop.  Our best guess on this is, “No.” The best long term data we have on pricing

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Big Price Increases Since Recession.

Nearly everyone who lives and works in the Denver Metro Area or the surrounding areas is aware that we’ve had some pretty hefty price increases year on year since the end of the recession in 2011. If you check out our data on the web site under Percent Change in Price Year to Year, you’ll see that consistent price increase of 5% to 15% annually began in 2012 and have continued through the summer of 2016. In fact, condo/townhome prices in the communities we cover increased by 20% in 2015 and 16% in the first half of 2016. Really stunning

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Agents for Homebuyers • 4450 Arapahoe Ave, Ste 100 • Boulder CO  80303
Phone: 303-448-8808Contact the A4HB team

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