While price appreciation continues to signal a strong Boulder-area market, month-over-month home sales for September pulled back in keeping with the usual fall slowdown.
This year, however, due to robust home sales in 2015, that comparative slowdown isn't restricted to the fall. Overall 2016 sales volume is lower than last year as was expected, according to Ken Hotard, senior vice president of public affairs for the Boulder Area Realtor® Association.
Single-family home sales in September 2016 dropped 21.4 percent with 348 homes sold compared to the 443 sold in August. Year-to-date, single-family home sales fell 10.9 percent through September 2016 with 3,385 homes sold compared to 3,801 through September 2015.
For condominiums and townhomes, declines were slightly larger.
Month-over-month sales decreased 22.8 percent in September 2016 – 115 units versus 149. In year-to-date sales, condo/townhome sales dropped 17.2 percent – 1,048 units through the end of September 2016 compared to 1,265.
Even so, Hotard notes that the market remains strong. Prices are holding month-over-month, and year-to-date numbers continue to show fairly significant appreciation across almost every market.
Hotard emphasizes that inventory is the critical component for Boulder County home sales now and going forward.
"The month of September had 1.5 months of inventory for condos and townhomes and about 2.7 months for single-family homes," he says.
"Typically a six-month supply is considered a balanced healthy market, so that's definitely a challenge."
Inventory of single-family homes for sale in Boulder County declined 4.6 percent in September 2016 compared to August 2016 with 941 homes available for sale compared to 986.
In condo/townhomes, inventory was virtually unchanged in the September to August 2016 comparison, dipping by one home – 173 versus 174.
"Improving both the quantity and mix of homes for sale would make a difference by providing alternatives for people so they have some choice, whether they are new buyers or downsizing," notes Hotard, adding that most of the construction is for rental units.
The lack of housing inventory reaches beyond the Boulder-area – it's an issue nationwide.
The shortage has become critical enough that the Obama administration recently released the “Housing Development Toolkit” to highlight actions state and local jurisdictions can take to encourage housing development.
The white paper encourages local governments to reconsider zoning laws, antiquated rules on construction, housing and land to address some of the regulatory barriers that are impeding the construction of housing.
In Colorado, Hotard says President Obama's call to action could be reflected in actions taken by the state legislature that would ease the current construction defects law, though changes to the law have been rejected in past legislative sessions.
But for Boulder-area buyers seeking to buy a home, adequate inventory is one key to success. For now, though inventory is low, it is relatively unchanged from last month.
And with fewer buyers actively looking for a home to buy during fall and winter, those in the market today have an advantage.
"Often in these slower months there is less competition for the homes that are available," says Hotard. From that perspective, it's a good time to buy.
"Investing in real property in this market area is always a good idea," he adds. "It's not realistic to think that you're going to get a lower price by waiting."
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