Though both home sales and inventory dropped year-over-year and month-over-month in November, Boulder-area real estate activity was consistent with recent trends as well as the expected slowing of the market that comes with the colder seasons.
“Every category of sales and inventory fell this month,” says Ken Hotard, senior vice president of public affairs for the Boulder Area Realtor® Association. “The market hasn’t changed dramatically the past several months other than the seasonal sales volume adjustment we typically anticipate."
Single-family home sales fell 12 percent compared with a year ago and attached unit sales dropped 4.5 percent. The inventory of homes on the market also fell 15.2 percent in the single-family category and 29.2 percent in the attached category year-over-year.
“We show continued tightening of inventory” resulting in “significant price appreciation in some markets,” Hotard adds.
Those markets would include Louisville, which saw a 15.3 percent jump in its average sales price and 16.9 percent rise in its median sales price in November. The other markets also doing well include Boulder, which saw nearly 10.5 percent increases in both average and median sales prices; Longmont, with an 11.6 percent increase in median sales price; and Broomfield, with an 11.5 percent in average sales price.
“The inventory issue continues to be one of the driving forces in the market,” Hotard explains, noting that the reasons people aren’t selling their homes include owing more than their homes will sell for; the costs of putting a home up for sale; the fallout from the housing boom and bust remains on people’s minds; and the fact that job growth is slow and wages have remained relatively stagnant for five years.
“Buyers are willing, ready and able,” he notes, pointing to the significant drop in days homes spend on the market compared with a year ago – from 69 days in November 2012 in Boulder to 51 days in November 2013.
“Tight credit is clearly one of the issues as far as who can get credit and how much credit,” Hotard says. “It’s also holding builders back because they have to qualify for loans to build spec homes; that’s not as easily done as it is said.”
While many experts in the industry are optimistic about job growth and a greatly improved market, Hotard says he expects “modest improvement and a solid year for the industry and buyers and sellers in the market.”
“I don’t see the inventory improving enough to be adequate for demand or potential demand in the market,” he adds. “I believe 2014 will be a positive year for real estate but I don’t expect it to take off like a rocket.”
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