The Boulder Valley’s real estate market remained resilient in April despite the lack of inventory, thanks to the strong demand for homes.
The 284 sales of single-family homes in Boulder County in April represented an 8.1 percent decrease compared with the 309 sales in April 2014 and a 4 percent decrease compared with 296 sales in March.
Countywide, 89 more single-family homes were for sale in April compared with March – 398 versus 487 units, respectively – representing a 22 percent increase, but April’s inventory was a drop of 30.2 percent compared with the 698 available in April 2014.
The county also saw 119 condominiums and townhomes sell in April, a 6.3 percent decrease compared with the 127 that sold in April 2014 but a 5 percent increase compared with the 112 attached-unit sales in March.
“It sort of indicates what we have known about the market and have been observing,” says Ken Hotard, senior vice president of public affairs for the Boulder Area Realtor® Association. “While we see positive growth, year-over-year sales are down, reflecting the declines in inventory.”
The market within the city of Boulder saw both month-over-month and year-over-year declines in single-family home sales: the 86 single-family sales in April represented a 16.5 percent decrease compared with a year ago, and a 4 percent decrease compared with March. And the 74 condo/townhome sales in April were a 2.6 percent reduction from the 76 units sold a year ago but an 8 percent increase compared with March.
“The sales reductions don’t match the magnitude in inventory,” Hotard says. “We have a strong market and high demand with significantly declining inventory.
“Why is inventory an issue? One reason is we’re not seeing an adequate amount of new housing coming into the marketplace,” he adds.
Hotard notes that builders are having trouble finding labor to meet the demand for new housing – a phenomenon occurring across the country. In Colorado, part of the problem is many laborers have left construction to work in other industries such as oil and gas, where they’re making more money.
Nationwide developers are also struggling to obtain loans for acquisition of land and development, making fewer sites available to builders, he says.
“We saw a small bump in new construction in April compared with March, but March wasn’t a really good month so that bump was simply an adjustment to fairly modest growth in construction,” Hotard explains.
Another reason fewer homes are going on the market is people are staying in their homes longer, he says.
Before the Great Recession, people historically stayed in their homes an average of seven years; now, especially among the Baby Boomer generation, they are living in their homes 10 years or longer, Hotard says. That timespan is growing and the trend is projected to continue.
Also, the struggles of current home owners who are still under water with their mortgages, don’t have enough equity in their homes to move up or who cannot obtain credit still plague the inventory issue, he adds.
“To me it’s telling that our sales numbers have kept pace and have not declined more significantly than they have,” Hotard says. “It’s a type of market we’ve not experienced before. It’s unique.”
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