The following analysis of the Metro Denver & Northern Colorado real estate market (which now includes Clear Creek, Gilpin, and Park counties) is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact your Windermere agent.
Colorado’s economy continues to grow with the addition of 45,900 new non-agricultural jobs over the past 12 months, which represents a growth rate of 1.7%. As I have stated in the last two Gardner Reports, we continue to see a modest slowdown in employment gains, but that is to be expected at this stage of the business cycle.
In May, the state unemployment rate was 3.2%, up from 3.1% a year ago. The increase in the rate is essentially due to labor force growth, which rose by over 55,700 people over the past year. On a seasonally adjusted basis, unemployment rates in all the markets contained in this report were lower than a year ago and are at full employment.
- In the second quarter of 2019, 17,853 homes sold. This is a drop of 1% compared to the second quarter of 2018 but a substantial 59.9% higher than the first quarter of this year. Pending sales — a sign of future closings — rose 5.8%, suggesting that closings in the third quarter are likely to show further improvement.
- Half of the counties contained in this report saw sales growth, while the other half had fewer closings. Sales in the small Clear Creek County fell precipitously. However, it was only a drop of 20 sales.
- The marginal drop in the number of sales compared to a year ago can be attributed to the ongoing increase in listing activity (+34.8%), which continues to give would-be home buyers more choice and less urgency.
- Inventory levels continue to rise, but demand for housing appears to be ongoing. I am not concerned by the marginal year-over-year slowdown and anticipate that sales will rise again in the third quarter.
- Home prices continue to trend higher, but the rate of growth has taken a pause, with the average home price in the region rising by just 2.3% year-over-year to $490,575.
- The drop in interest rates this year has nudged more buyers off the fence and this can allow further price growth as we move through the year.
- Appreciation was again strongest in Park County, where prices rose 6.1%. We also saw strong growth in Weld County, which rose by 6.1%. Home prices dropped in Clear Creek, Boulder, and Gilpin counties, but I do not see this as being indicative of a trend in these markets.
- Affordability continues to be an issue in many Colorado markets and this may act as a modest headwind to ongoing price growth. However, some of the slowing may be offset by very favorable mortgage rates.
DAYS ON MARKET
- The average number of days it took to sell a home in the markets contained in this report rose four days over the second quarter of 2018.
- The amount of time it took to sell a home rose in all counties except Gilpin when compared to the second quarter of 2018.
- It took an average of 29 days to sell a home in the region — a drop of 13 days compared to the first quarter of this year.
- It is likely that the drop in time-on-market was a function of the emerging spring selling season as well as falling mortgage rates.
This speedometer reflects the state of the region’s real estate market using housing inventory, price gains, home sales, interest rates, and larger economic factors.
For the second quarter of 2019, I continue the trend I started last summer and have moved the needle a little more in favor of buyers. I continue to closely monitor listing activity to see if we get any major bumps above the traditional increase because that may further slow home price growth. However, the trend for 2019 will continue to be a move toward a more balanced market.
ABOUT MATTHEW GARDNER
As Chief Economist for Windermere Real Estate, Matthew Gardner is responsible for analyzing and interpreting economic data and its impact on the real estate market on both a local and national level. Matthew has over 30 years of professional experience both in the U.S. and U.K.
In addition to his day-to-day responsibilities, Matthew sits on the Washington State Governors Council of Economic Advisors; chairs the Board of Trustees at the Washington Center for Real Estate Research at the University of Washington; and is an Advisory Board Member at the Runstad Center for Real Estate Studies at the University of Washington where he also lectures in real estate economics.
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OB JACOBI . Co-President | JILL JACOBI WOOD . Co-President | GEOFF WOOD . CEO CHRISTINE WOOD . Executive Director . Windermere Foundation
Community has always been a big part of who we are at Windermere. Back in the early days of the company it was pretty simple; we would see a need and help where we could. But as we grew, we realized we could accomplish much more if we had a stronger focus, so we started the Windermere Foundation in 1989 with the goal of helping low-income and homeless families. From that point on, whenever a Windermere agent sold a home, a portion of their commission went to funding our Foundation. In its first year, the Windermere Foundation brought in $90,000. This year we are on track to raise $2.3 million for a grand total of $35 million. Christine Wood, Executive Director of the Windermere Foundation, is the passionate, driving force behind this effort. – OB Jacobi, Jill Jacobi Wood, Geoff Wood
The Windermere Foundation is funded by more than 7,000 individuals, made up by agents, staff, management, owners, as well as public donations. We keep our administrative costs below three percent, so the vast majority of these donations go back into the hands of our agents and offices to decide how best to use them in their local community.
The result is more support for families who are struggling to keep food on the table. More kids who will be able to eat school lunches. More homeless who will have their most basic needs met – and the dignity that goes with it. The need is overwhelming, but every bit helps.
As the year draws to a close, I want to personally thank everyone who has supported the Windermere Foundation. The generosity of our agents, owners, staff, and the public never ceases to amaze us; they raise the bar every year. And in turn, every year, we are able to do more for those who need it most, one home sale at a time. – Christine Wood
This just in…
For the month of April, the average price of a home in the city of Boulder was $1,247,000. This is according to the latest from our IRES MLS system.
If you want to own a home about an hour down the road in another really nice college town and get a 66% discount, you may want to check out Fort Collins 🙂
Yes, despite the recent uptick in prices here locally, we are still a bargain compared to Boulder. Here are median single-family prices for our markets and their relative price to Boulder:
- Fort Collins = $414,237 (66.8% off)
- Loveland = $360,150 (71.1% off)
- Greeley = $290,000 (76.7% off)
- Windsor = $306,450 (75.4% off)
Grab a copy of our Investment Kit so you can see the simple steps to get started without stress or complication. Email us at firstname.lastname@example.org and we will send you a video which clarifies the process and our Investment Checklist so you can see what to do first.
Northern Colorado isn’t the only place with limited inventory.
Metro Denver is short by 10,000 listings.
The average number of homes for sale for this time of year in the Denver area, going all the way back to 1985, is 14,309.
Right now there are 4,084 residential properties on the market. This is a difference of 10,225 listings compared to the long-term average.
The peak was 2008 when there were 25,037 listings. The lowest year was last year with 3,878 (a drop of 21,159 in 9 years?!).
The good news for buyers is that inventory is up 5% compared to last year. Another piece of good news is that the Spring tends to produce the highest amount of inventory for buyers to pick from.
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