While the Boulder-area real estate markets continued to demonstrate resilience in August, with sales and prices surpassing those of August 2011, it was obvious the fall slowdown had come early.
The 376 single-family sales in August were a 12.2 percent increase compared with the 335 sales in August 2011. And the 122 condominium/townhome sales in August 2012 were an increase of 3 percent over the 118 sales the year before.
“We closed out the summer continuing our very positive trend,” says Ken Hotard, senior vice president of public affairs for the Boulder Area Realtor® Association.
However, August’s single-family home sales represented a 10.2 percent decrease from 422 sales in July, and the attached unit sales saw an 18 percent drop from the 149 transactions closed in July. Hotard says that while it’s not unusual to see fewer sales in autumn, this slowdown began in July – a month or so early.
“It is consistent in terms of the range of change in the market,” he says. “It seems to be a bit early this year as far as when we’re seeing the seasonal slowdown.”
It’s also likely the low inventory of homes on the market is contributing to the premature slowdown, Hotard says.
The number of single-family homes on the market decreased 20 percent from August 2011 to August 2012, and the attached-unit inventory dropped 32 percent year-over-year. There were 6 percent fewer single-family homes on the market in August compared with July, and 9 percent fewer attached units for sale than the previous month.
“Inventory continues to create issues in the market,” Hotard says.
On the bright side, the Boulder Valley market is showing its resilience via both average and median home sales prices: only three markets saw decreases – and then only slight ones – in average sales price and only two showed decreases in median sales price.
“If you look at the change in average and median sales prices, almost all of them are in the positive,” Hotard says. “That’s showing that from a pricing standpoint, we really have stabilized and showed some modest improvement, particularly within the second and third quarters of this year.”
Although the Boulder-area market is doing well, it is still struggling against the same obstacles it has in recent years: the economy and lack of credit availability, Hotard says.
“The market is still plagued by the sluggish economy,” he says. “However, I believe personally that the key issue around low sales volumes is hung up in lending criteria – it’s still too restrictive and keeping qualified buyers out of the marketplace. This needs to be addressed moving forward into next year.”
And the upcoming presidential election is causing a “modest dampening of the market,” as well, Hotard says.
“The National Association of Realtors® did research recently and determined that a number of potential buyers and sellers had decided to wait out the election before making the final decision on whether to get into the marketplace,” he says.
Nonetheless, “the first nine months of this year are a dramatic change from the first nine months of last year,” Hotard adds. “We’ve seen strong growth in sales and prices, supporting the notion that we have one of the best residential markets in the country.”
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