The Whole Story

Metro Denver has 2.1 months of inventory on the market. This means that, at the current pace of sales, it would take just over 2 months to sell every single-family home currently listed for sale.

But that’s not the whole story because inventory levels vary drastically depending upon the price of the home.

When we take a closer look at months of inventory broken down by price range this is what we see:

• Under $400,000 = 0.9 months
• $400,000 to $500,000 = 1.8 months
• $500,000 to $750,000 = 3.1 months
• $750,000 to $1,000,000 = 4.2 months
• Over $1,000,000 = 7.7 months

These numbers represent great news for move-up buyers because they can sell in a strong market and potentially move up to a market that is market that is not as strong.

 

              Below is a short video with a recap of our annual Market Forecast presentation!

The post The Whole Story appeared first on Fort Collins Real Estate | Fort Collins Homes for Sale & Property Search.

How’s 2019?

A lot of our clients are asking how 2019 is starting off.

Here’s one thing we notice…

There are more homes to choose from, which is great news for buyers.

In January alone 4,821 homes came on the market in Metro Denver.

That is a 14% increase compared to one year ago.

At our annual Market Forecast, we predicted a more balanced market in 2019, so far it looks like we are trending that way.

________________________________________________________________________________________

Below is the recap of our Denver Annual Market Forecast!

The post How’s 2019? appeared first on Fort Collins Real Estate | Fort Collins Homes for Sale & Property Search.

Misery Index


Last week at our Market Forecast events, Chief Economist Matthew Gardner shared, among many stats, his famous “Misery Index.”

A valuable statistic with a funny title.

The Misery Index simply measures inflation plus unemployment.

It’s an effective way to look at our Nation’s economy.

Today’s Index sits just below 6%. Back in October 2011, it was close to 13%.

The lowest it has been in the last 7 years is October 2015 when it was near 5%.

       ________________________________________

         If you would like a copy of the entire Forecast presentation, go ahead and reach out to us. 

We would be happy to put it in your hands.

The post Misery Index appeared first on Fort Collins Real Estate | Fort Collins Homes for Sale & Property Search.

What Our Expert Thinks

Here’s what our Chief Economist, Matthew Gardner, thinks about the 2019 U.S. Housing Market. He is regarded as one of the Country’s experts on real estate and is frequently quoted by leading industry publications.

 

• Existing Home Sales up 1.9% to 5.4 million units
• Home Prices up 4.4%
• New Home Sales up 6.9% to 695,000 (the highest since 2007)

 

If you want to see all of Matthew’s predictions including where interest rates are headed, get signed up for our annual Forecast. Click the link below!

https://www.eventbrite.com/o/windermere-real-estate-12011801121

The post What Our Expert Thinks appeared first on Fort Collins Real Estate | Fort Collins Homes for Sale & Property Search.

Waiting and Waiting

Anytime the market cools off we sometimes hear prospective buyers say “I think I’ll wait for the market to correct, then I’ll buy after prices come way down.”

The reality is this… History shows that this wouldn’t be a good strategy.

Our go-to source on price appreciation is the Federal Housing Finance Authority who produces a quarterly home price index.  They have been tracking Larimer County for 41 years.

Their numbers show:

  • Yearly prices have decreased only 6 times in history
  • The average amount of that decrease is only 1.7%

So, someone who is waiting for prices to drop:

  • Might be waiting a long time
  • Might be disappointed that prices didn’t drop by all that much

The post Waiting and Waiting appeared first on Fort Collins Real Estate | Fort Collins Homes for Sale & Property Search.

83 Miles Per Hour

 

Pretend you have been driving on the Interstate at 100 miles per hour. 

Also, pretend you have been doing that for a long time.

Now pretend you slow down to 83 miles per hour.

How would that feel?

It would probably feel slow, right?

83 miles per hour is a 17% decrease from 100. It may feel slow, but it’s still pretty fast.

How does this relate to real estate?

Well, the market has been moving fast for a long time.

It’s been going 100 miles per hour for at least two years (some would argue even longer).

We’ve recently seen a 17% change in terms of number of transactions that are occurring.

There were 17% fewer sales in October 2018 versus October 2017 in Metro Denver.

It feels slow because we’ve been driving so fast for so long. But, our market is still moving.

For example, prices are still up. So, remember, that it’s all relative.

The post 83 Miles Per Hour appeared first on Fort Collins Real Estate | Fort Collins Homes for Sale & Property Search.

Colorado Real Estate Market Update

 

The following analysis of the Metro Denver & Northern Colorado real estate market (which now includes Clear Creek, Gilpin, and Park Counties) is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact your Windermere agent.

ECONOMIC OVERVIEW

The Colorado economy continues to perform quite well, having added 72,200 non-agricultural jobs over the past 12 months — a solid growth rate of 2.7%. Through the first eight months of 2018, the state has added an average of 6,700 new jobs per month. There has been a modest slowdown in employment gains, but I really don’t think this is a cause for concern and still hold to my forecast that Colorado will add a total of 82,000 new jobs by the end of 2018.

In August, the state unemployment rate was 2.9%. This matches the level seen a year ago. Unemployment rates in all the markets contained in this report rose between August 2017 and August 2018 but this is not actually a concern. Growth in the workforce is not only due to recent college graduates, but also discouraged workers who are starting to look for work again and this puts upward pressure on the unemployment rate. All of Colorado’s metropolitan areas are showing unemployment rates at around 4% or lower, suggesting that the regional economies are at, or close to, full employment.

HOME SALES ACTIVITY

  • In the third quarter of 2018, 16,550 homes sold — a drop of 6.2% compared to the third quarter of 2017.
  • Sales rose in just two of the 11 counties contained in this report. Gilpin County again led the way, with sales rising by an impressive 21.1% compared to third quarter of last year. There was also a significant increase in Clear Creek County. Sales fell the most in Arapahoe County.
  • Slowing sales in the quarter can, to a degree, be attributed to continued home price growth, but I believe it is more a function of the rapid rise in the number of homes for sale. The number of listings in third quarter rose by 5.4% over the same period in 2017, but was up by 31.2% compared to the second quarter of this year.
  • What the numbers are telling us is that inventory growth is giving buyers more choice and they are being far more selective — and patient — before making an offer on a home.

 

HOME PRICES

  • Even with the rapid rise in listings and slowing home sales, prices continue to trend higher. The average home price in the region rose 7.9% year-over-year to $460,982. However, the average price dropped 4% between second and third quarters.
  • The smallest price gains in the region were in Park County, where prices rose by a fairly modest 3.6%.
  • Appreciation was strongest in Clear Creek County, where prices rose 10%. All other counties in this report saw gains relative to the third quarter of 2017.
  • Affordability is becoming an issue in many Colorado markets and this, in concert with rising inventory levels, has started to dampen home price growth. Although I do not expect prices to drop, I do think price gains will moderate over the next few quarters.

 

DAYS ON MARKET

  • The average number of days it took to sell a home in Colorado remained at the same level as a year ago.
  • The amount of time it took to sell a home dropped in three counties: Gilpin, Clear Creek, and Larimer. The rest of the counties in this report saw days on market rise by only a couple of days or less.
  • In the third quarter of 2018, it took an average of 24 days to sell a home. It took less than a month to sell a home in all but one county.
  • Housing demand is still solid and, as long as homes are priced appropriately, they will continue to sell in less time than historic averages.

CONCLUSIONS

This speedometer reflects the state of the region’s real estate market using housing inventory, price gains, home sales, interest rates, and larger economic factors.

For the third quarter of 2018, I continue the trend that I started last quarter and have moved the needle a little more in favor of buyers. Listings are likely to continue their rising trend, but we should still see a seasonal drop off during the winter months. The market is clearly headed toward balance, which I am very pleased to see.

 

Matthew Gardner is the Chief Economist for Windermere Real Estate, specializing in residential market analysis, commercial/industrial market analysis, financial analysis, and land use and regional economics. He is the former Principal of Gardner Economics, and has more than 30 years of professional experience both in the U.S. and U.K.

The post Colorado Real Estate Market Update appeared first on Fort Collins Real Estate | Fort Collins Homes for Sale & Property Search.

FUNdamentals

 

In times of change (like now), it’s valuable to look at the fundamentals of our market.

Let’s have some fun with fundamentals…

1.  Our economy is healthy – since 1990, the unemployment rate in Colorado has never been higher than the U.S. unemployment rate.  Ever.  Unemployment in Colorado sits at 2.7% today while the rate across the U.S. is 4.0%.

2.  People keep moving here – since 2005 our population has grown by just over a million people which is roughly 77,000 per year (about the size of Mile High Stadium).

3.  Our real estate outperforms other places – according the Federal Housing Finance Authority, Colorado is the #1 state for home price appreciation since 1990.

The post FUNdamentals appeared first on Fort Collins Real Estate | Fort Collins Homes for Sale & Property Search.

What’s Starting?

Here are some interesting stats from our friends at Metro Study who study new home activity along the Front Range.

• New home starts are up 14% compared to last year – this is really good news and is helping to relieve the shortage of housing inventory

• Every product type saw an increase in starts compared to last year (single family, town-home and condominium)

• Condominiums saw the largest increase in starts by a long shot, up 112% over last year- this is excellent news for first time buyers and those looking for product in lower price ranges.

The post What’s Starting? appeared first on Fort Collins Real Estate | Fort Collins Homes for Sale & Property Search.

5 Reasons Rising Interest Rates Won’t Wreck the Housing Market

Interest rates have been trending higher since the fall of 2017, and I fully expect they will continue in that direction – albeit relatively slowly – as we move through the balance of the year and into 2019. So what does this mean for the US housing market?

It might come as a surprise to learn that I really don’t think rising interest rates will have a major impact on the housing market. Here is my reasoning:

1. First Time Home Buyers 

As interest rates rise, I expect more buyers to get off the fence and into the market; specifically, first time buyers who, according to Freddie Mac, made up nearly half of new mortgages in the first quarter of this year. First-time buyers are critical to the overall health of the housing market because of the subsequent chain reaction of sales that result so this is actually a positive outcome of rising rates.

2. Easing Credit Standards

Rising interest rates may actually push some lenders to modestly ease credit standards. I know this statement will cause some people to think that easing credit will immediately send us back to the days of sub-prime lending and housing bubbles, but I don’t see this happening. Even a very modest easing of credit will allow for more than one million new home buyers to qualify for a mortgage.

3. Low Unemployment 

We stand today in a country with very low unemployment (currently 4.0% and likely to get close to 3.5% by year’s end). Low unemployment rates encourage employers to raise wages to keep existing talent, as well as to recruit new talent. Wage growth can, to a degree, offset increasing interest rates because, as wages rise, buyers can afford higher mortgage payments.

4. Supply

There is a clear relationship between housing supply, home prices, and interest rates. We’re already seeing a shift in inventory levels with more homes coming on the market, and I fully expect this trend to continue for the foreseeable future. This increase in supply is, in part, a result of homeowners looking to cash in on their home’s appreciation before interest rates rise too far. This, on its own, will help ease the growth of home prices and offset rising interest rates. Furthermore, if we start to see more new construction activity at the lower end of the market, this too will help.

National versus Local

Up until this point, I’ve looked at how rising interest rates might impact the housing market on a national level, but as we all know, real estate is local, and different markets react to shifts in different ways. For example, rising interest rates will be felt more in expensive housing markets, such as San Francisco, New York, Los Angeles, and Orange County, but I expect to see less impact in areas like Cleveland, Philadelphia, Pittsburg, and Detroit, where buyers spend a lower percentage of their incomes on housing. The exception to this would be if interest rates continue to rise for a prolonged period; in that case, we might see demand start to taper off, especially in the less expensive housing markets where buyers are more price sensitive.

For more than seven years, home buyers and real estate professionals alike have grown very accustomed to historically low interest rates. We always knew the time would come when they would begin to rise again, but that doesn’t mean the outlook for housing is doom and gloom. On the contrary, I believe rising interest rates will help bring us closer to a more balanced real estate market, something that is sorely needed in many markets across the country.

The post 5 Reasons Rising Interest Rates Won’t Wreck the Housing Market appeared first on Fort Collins Real Estate | Fort Collins Homes for Sale & Property Search.