By Duane Duggan Colorado Association of REALTORS NE District Spokesperson
The Northeast district covers a wide variety of markets from Boulder, Louisville, Lafayette, Estes Park, Longmont, to Sterling.
Remember all real estate is local, down to the neighborhood and sometimes even the specific street. Keep that in mind when reviewing these overall stats.
Key market indicators showed the market trending toward a seller’s market in 2012. At the completion of 2013, key market indicators are showing an even stronger sellers market.
New listings in the Northeast district are up 11.7 in 2013 compared to 2012. However, solds are up 17.4 creating low inventory situations in most market segments, leaving only a 2.8 month supply of homes.Dropping below a 3 month supply of homes is a key indication of a seller’s market.
Hopefully, as prices rise, we will see more sellers decide to put their home on the market, since they have equity again. However, many seller’s fear they won’t be able to find that replacement property and therefore just stay put.
The Percent of list price has increased from 97.9 % in 2012 to 98.5% in 2013, again putting smiles on seller’s faces.
The average days on market has dropped from 107 to 84. A balanced market is 90 days. This indicates a trend toward a seller’s market.
Median sale price increasing is another indicator of market strength. In the northeast district median sales price has gone from $220,725 to $238,000.
The housing affordability Index is an index based on interest rates, median sales price, and average income by county. In the northeast district, the index has fallen from 171 to 146. Not so good news for buyers.
The NE district experienced one of the most unique events of the last 100 years. The Great Flood of 2013 ripped through the NE district with a vengeance. We already had low inventories and vacancy rates. As homeowners and tenants were displaced, the rental vacancy rate went to zero within a week after September 13th priced homes in the district snapped up as many people were looking for a place to sleep! The flood put more pressure on an already low inventory, as many homes had to be taken off the market due to flooding.
In the NE District building is being revived, but builders are having trouble gearing up with a lack of trades people still in the area.
Boomerang buyers are putting pressure on inventory too. These are the folks that lost their home to foreclosure, but are coming back into the market as their credit improves.
The twenty somethings are finally getting a job and ready to move out of mom and dads basement and are ready to create a new household absorbing more inventory.
In the NE district population is rising with births and immigration to our state. Stronger employment and low interest rates have created conditions for more inventory to be absorbed.
Another reason causing the housing shortage is the fact taht people are living longer, staying in their homes, and now moving every 9 years instead of 5 years, creating more pressure on inventory.
All these factors point toward an seller’s real estate market, and a tougher time for buyers over the next few years.
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