Area home sales upstage last year’s, though prices still show volatility

Posted by DB Wilson on Monday, November 7th, 2011 at 4:28pm.

While Boulder County home sales improved month-over-month in September again – the fourth consecutive month – average and median house prices continued to demonstrate volatility.

Boulder communities had 244 single-family homes sell in September, compared with 227 in September 2010 – a 7 percent increase – and 335 in August 2011. In the townhome/condominium market, 88 homes sold in September compared with 72 a year ago – a 22 percent jump – and 118 in August 2011.

The communities of Erie, Longmont and the mountains all saw drops in average price while those communities as well as Superior and Louisville also saw median home prices decrease slightly in September. The mountains saw the biggest drop in both average and median home sale prices, falling 5.6 percent and 3.9 percent, respectively. 

Ken Hotard, senior vice president of public affairs for the Boulder Area Realtor® Association, says prices are showing “little bigger swings but nothing too extreme” in the single-family market.

The townhome/condominium market’s prices are much less reliable, with Erie, Louisville and Superior seeing average price decreases in the double-digit range, and Erie and Louisville experiencing similar decreases in their median sale prices.

“Three key things playing in the market right now: economic uncertainty, relatively high unemployment and tight lending,” Hotard says. “In the Boulder and Broomfield county markets, the good news here has been we’ve seen solid improvement in unemployment numbers.”

Boulder County’s unemployment rate was 5. 9 percent in September, and Broomfield County’s stood at 6.7 percent – both well below the national average of 9.1 percent – while Colorado’s unemployment rate came in at 8.3 percent.

Hotard says it’s easier to find financing and federal tax credits are currently available for multifamily rental housing, fueling the increase in apartment construction. “That’s where the game is at the moment in terms of housing finance,” he says. “You really do have to look at your local market to get a sense of what’s going on.”

And the Boulder-Broomfield area, in particular, managed to weather the downturn in much better shape than most parts of the country. The biggest challenge here has been sales volume, which has been showing solid improvement since June, he says.

Hotard notes that Colorado’s economic recovery isn’t necessarily tied to the nation’s, but anything that happens on a national level will filter down to the state and local market, whether good or bad.

And incoming businesses providing jobs in the high-tech industry and electronic device manufacturing along the Front Range – one with 3,500 jobs – show that Colorado and its qualified labor force are still attractive to companies.

Hotard says that although homes sales in the last 12 months still lag behind the previous 12 months in both the single-family and attached markets, 2011 sales may yet exceed those of 2010.

“We’re going to need some strong sales going through the last three months of the year, but we’ve still got a shot at beating last year,” he says.

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