The Scoop – 3rd Quarter 2019

WELCOME TO “THE SCOOP”

Everything You Need to Know About the Northern Colorado Real Estate Market – Produced Quarterly by Windermere Real Estate in Northern Colorado

The 10-Year Rhythm

As we study 40 years of price appreciation data for Larimer County, an interesting pattern emerges.  We call this pattern the 10-Year Rhythm.  It shows that price appreciation in ten-year segments tends to closely mirror the 40-year average of 5.42%.  This demonstrates that our market grows in a steady, predictable way instead of taking wild swings like other markets.

Long Term Home Prices

A trusted resource is the Federal Housing Finance Authority (FHFA) which tracks nearly 300 markets across the country and produces a quarterly price appreciation index.

Larimer County

Weld County

State Ranking

According to the Federal Housing Finance Authority, these are the top 5 states for home price appreciation over the last 5 years:

A Mile High

Did you know our state grows by a Mile-High Stadium’s-worth of people each year?  That’s right, we’ve been growing by about 75,000 people each year, and we will keep growing.  The State Demography office estimates we will have 7.5 million people living here by 2040.

Market Speedometer

Each quarter. our Chief Economist Matthew Gardner produces his economic report for Metro Denver and Northern Colorado. Inside you will find his market speedometer. 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.

According to Gardner, “I have moved the needle very slightly towards buyers as a few Front Range counties saw home inventories rise. However, while I expect to see listings increase in the coming months, for now, the housing market continues to heavily favor sellers.”

Rental Numbers

What’s Up With Down Rates

It was only a few months ago when experts predicted that 30-year mortgage rates would hit five percent by the end of 2019. For many, it was a foregone conclusion. At the end of 2018, they were already in the high fours. It appeared as if the low interest rate party was over. Then along came mid-2019 and rates kept going lower and lower. Now they are in the high threes and back to where they were in the fall of 2016. What gives? It turns out that trade tensions between the

U.S. and China have caused concerns about a global economic slowdown which, in turn, have pushed rates lower. Lower rates are of course great news for buyers and people thinking about refinancing.

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Posted on July 25, 2019 at 7:29 pm
Paul Hunter | Category: Buyer Tips, Evans Real Estate, Fort Collins Real Estate, Johnstown Real Estae, Johnstown Real Estate, Longmont Real Estate, Loveland Real Estate, Real Estate, Seller Tips, Wellington Real Estate, Windsor Real Estate

New Gardner Report!

 

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.

 

ECONOMIC OVERVIEW

Colorado’s economy continues to grow with the addition of 44,800 new non-agricultural jobs over the past 12 months. This represents a reasonable growth rate of 1.7%. As stated in last quarter’s Gardner Report, we continue to see a modest slowdown in employment gains, but that’s to be expected at this stage of the business cycle. I predict that employment growth in Colorado will pick back up as we move through the year, adding a total of 70,000 new jobs in 2019, which represents a growth rate of 2.6%.

In February, the state unemployment rate was 3.7%, up from 2.9% a year ago. The increase is essentially due to labor force growth, which rose by more than 84,000 people over the past year. On a seasonally adjusted basis, unemployment rates in all the markets contained in this report haven’t moved much in the past year, but Boulder saw a modest drop (2.7%), and the balance of the state either remained at the same level as a year ago or rose very modestly.

 

HOME SALES

  • In the first quarter of 2019, 11,164 homes sold — a drop of 3% compared to the first quarter of 2018 and down 13.5% from the fourth quarter of last year. Pending sales in the quarter were a mixed bag. Five counties saw an increase, but five showed signs of slowing.
  • The only market that had sales growth was Adams, which rose 4.9%. The rest of the counties contained in this report saw sales decline, with a significant drop in the small Park County area.
  • I believe the drop in the number of home sales is partially due to the significant increase in listings (+45.6%), which has given would-be home buyers more choice and less need to act quickly.
  • As mentioned above, inventory growth in the quarter was significant, but I continue to believe that the market will see sales rise. I expect the second half of the year to perform better than the first.

 

 

HOME PRICES

  • Home prices continue to trend higher, but the rate of growth is tapering. The average home price in the region rose just 2.1% year-over-year to $456,243. Home prices were .3% higher than in the fourth quarter of 2018.
  • I anticipate that the drop in interest rates early in the year will likely get more buyers off the fence and this will allow prices to rise.
  • Appreciation was again strongest in Park County, where prices rose 21.9%. We still attribute this rapid increase to it being a small market. Only Clear Creek County experienced a drop in average home price. Similar to Park County, this is due to it being a very small market, making it more prone to significant swings.
  • Affordability remains an issue in many Colorado markets but that may be offset by the drop in interest rates.

 

 

DAYS ON MARKET

  • The average number of days it took to sell a home in Colorado rose five days compared to the first quarter of 2018.
  • The amount of time it took to sell a home dropped in two counties — Gilpin and Park — compared to the first quarter of 2018. The rest of the counties in this report saw days-on-market rise modestly with the exception of the small Clear Creek market, which rose by 26 days.
  • In the first quarter of 2019, it took an average of 42 days to sell a home in the region, an increase of four days compared to the final quarter of 2018.
  • Job growth drives housing demand, but buyers are faced with more choice and are far less frantic than they were over the past few years. That said, I anticipate the late spring will bring more activity and sales.

 

 

CONCLUSIONS

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 first quarter of 2019, I have moved the needle a little more in favor of buyers. I am watching listing activity closely 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 towards a more balanced market.

 

 

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.

Posted on May 2, 2019 at 3:13 pm
Paul Hunter | Category: About the area, Buyer Tips, Evans Real Estate, Fort Collins Real Estate, Homes for Sale, Investment, Johnstown Real Estae, Longmont Real Estate, Loveland Real Estate, Real Estate, Seller Tips, Wellington Real Estate, Windsor Real Estate | Tagged , , , , ,

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Posted on April 25, 2019 at 4:32 pm
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