August 2012 Denver Real Estate

August Quick Stats

Denver Metro Single Family Housing Stats:

Active Listings: 9,060

* Down 33% from Aug. ‘11

Under Contracts: 4,191

* Up 18% from Aug. ‘11

Solds: 3,730

* Up 17% from Aug. ‘11

Average Price: $311,893

* Up 10% from Aug. ‘11

Average Days on Market: 63

* Down 34% from Aug. ‘11

Denver Metro Condo Housing Stats:

Active Listings: 1,766

* Down 45% from Aug. ‘11

Under Contracts: 1,005

* Up 2% from Aug. ‘11

Solds: 955

* Up 20% from Aug. ‘11

Average Price: $183,359

* Up 9% from Aug. ‘11

Average Days on Market: 69

* Down 38% from Aug. ‘11
 

Real Estate News – Detailed Stats on Denver Neighborhoods

This month let’s take a closer look at some important submarkets around town. Each table gives us a snapshot of what is happening in different neighborhoods of greater Denver.

 

Denver Northeast

Category	Aug, ‘11	Aug, ‘12	Change
Average Price	$234,189	$266,143	+13.6%
Days on Market	93	53	-43%
# of Active Listings	583	332	-43.1%
# of Closed Sales - YTD	1,450	1,577	+8.8%

Denver Northwest

Category	Aug, ‘11	Aug, ‘12	Change
Average Price	$286,670	$328,344	+14.5%
Days on Market	60	43	-28.3%
# of Active Listings	382	233	-39%
# of Closed Sales - YTD	757	900	+18.9%

Denver Southeast

Category	Aug, ‘11	Aug, ‘12	Change
Average Price	$435,073	$447,635	+2.9%
Days on Market	96	56	-41.7%
# of Active Listings	1,127	704	-37.5%
# of Closed Sales - YTD	1,683	2,129	+26.5%

Denver Southwest

Category	Aug, ‘11	Aug, ‘12	Change
Average Price	$136,573	$179,822	+31.7%
Days on Market	92	59	-35.9%
# of Active Listings	417	226	-45.8%
# of Closed Sales - YTD	945	1,015	+7.4%

Aurora North

Category	Aug, ‘11	Aug, ‘12	Change
Average Price	$107,694	$121,889	+13.2%
Days on Market	72	41	-43.1%
# of Active Listings	201	72	-64.2%
# of Closed Sales - YTD	538	481	-10.6%

Aurora South

Category	Aug, ‘11	Aug, ‘12	Change
Average Price	$183,523	$213,356	+16.3%
Days on Market	94	54	-42.6%
# of Active Listings	671	396	-41%
# of Closed Sales - YTD	1,882	1,981	+5.3%

Broomfield

Category	Aug, ‘11	Aug, ‘12	Change
Average Price	$343,462	$340,470	-0.9%
Days on Market	88	70	-20.5%
# of Active Listings	282	172	-39%
# of Closed Sales - YTD	444	538	+21.2%

Highlands Ranch, Lone Tree

Category	Aug, ‘11	Aug, ‘12	Change
Average Price	$358,316	$369,417	+3.1%
Days on Market	88	50	-43.2%
# of Active Listings	529	314	-40.6%
# of Closed Sales - YTD	1,136	1,376	+21.1%

Buyers – The National Scene Mirrors Denver

We talk a lot in this Newsletter about the local housing market but it is important to understand that our market does not exist in a vacuum; it is part of a state, regional, and national market as well. The turnaround we are experiencing is not a local phenomenon, it is occurring in the majority of real estate markets around the country.

What we are seeing is the turnaround portion of a predictable, 7-10 year market cycle with national roots. Nearly seven years after the housing bubble burst, most indexes of house prices around the country are bending up. "We finally saw some rising home prices," S&P's David Blitzer said a few weeks ago as he reported the first monthly increase in the slow-moving S&P/Case-Shiller house-price data after seven months of declines. Nearly 10% more existing homes were sold in May than in the same month a year earlier, many purchased by investors who plan to rent them for now and sell them later, an important sign of an inflection point. The fraction of homes that are vacant is at its lowest level since 2006.

Even builders are getting back into the game. Nationally, builders began work on 26% more single-family homes in May 2012 than May 2011. The stock of unsold newly built homes is back to 2005 levels. In each of the past four quarters, housing construction has added to economic growth.

Sellers – Multiple Offers are Back!

I read an article in the Wall Street Journal titled: Stunned Home Buyers Find the Bidding Wars are Back.  I find the media are 6-12 months behind what I’m actually seeing on the street, reporting on trends well after they’ve appeared in the marketplace. But this time I had to give them credit because this is exactly what I’m seeing in my business. Since late winter/early spring my sellers have been shocked not only by the number of offers they’re getting but by the quality of the offers as well. Gone are the days when buyers submitted lowball offers to test the market. These types of buyers quickly learn to make a serious offer or they get flushed out of the market. I had a listing recently that had 5 offers on it within 4 days, and three were above asking price. A year or two ago this would’ve been unheard of, but today it is all but the norm.

The Journal may as well have been talking about our market, right here in our backyard, because that is exactly what is happening. And it’s no mystery why. The number of homes on the market is down by a third from this time last year. Even with that incredible lack of inventory, homes under contract are up by 18%. The average price of a home has increased by 10% in the past year and the average days on market (the time it takes to sell a home) has dropped by 34%. Add it all up and we’re in the middle of a screaming hot sellers market!

Want to know what your home is worth? Give me a call and I’ll create a professionally prepared Competitive Market Analysis for your home and let you know.

Investors – Cashflow is King

In case you didn’t know, the market for buy and hold investors has NEVER been better. An odd combination of economic circumstances has converged to make this one of the best buy and hold markets Denver has ever seen. Here are four reasons why:

1. The Home Affordability Index for homes in metro Denver is still at its highest level in record.
2. Interest rates are at 50-year lows.
3. The rental vacancy rate is 1.5% (the lowest in Denver history).
4. Rents rose more last year than any year in a decade, and are still rising.

My clients have been asking my how long this set of circumstances can continue before the market readjusts itself, as it always does. That’s a very difficult question to answer because nobody knows what the future holds. My best guess is that home prices will continue to climb, but this will be offset largely by the dramatic rise in rents which we have been experiencing for the past couple of years. Since it’s hard to imagine interest rates or vacancy rates getting much lower I think that slowly over the next few years we’ll see cashflows begin to suffer for investors purchasing buy and hold investments. But investors who bought recently or who are buying now and locking in record low interest rates will take advantage of the continuing rise in rents to increase their cashflow for the foreseeable future. That’s why 30% of the homes purchased in metro Denver are bought by investors taking advantage of the current circumstances. If you’re interested in learning more about this opportunity give me a call and I’d be happy to discuss it with you.

YCRE in the News – Investor Success Summit Saturday, November 3.

 

Mortgages – Still a Great Time to Get a Loan

It’s a great time to get a mortgage! With some of the amazing opportunities available in the real estate market, whether you are a first time buyer or a seasoned investor you should be looking into buying a property with a fantastic mortgage rate. Mortgage rates continue to hover at all-time lows, but many experts in the financial community agree that this is not sustainable and we will eventually see rates increase.

  

 

For more information contact Lorena Tankersley at Your Castle Real Estate,LLC at Lorena@yourcastle.org or call 303-981-6539. If you want information specific to your neighborhood, please let me know. http:/Lorena.Yourcastle.org