Market update for August

REAL ESTATE MARKET UPDATE
An Information Service of RE/MAX Alliance/Boulder Valley

August/2007

The information age is upon us and will forever be a part of the human experience. As such, much of what we come to believe is based on the information we allow into our lives and how we process that information. Thus, perception and reality can often be two different things i.e. what one believes “is” may not actually “be”.
As an example, much has been discussed about the state of the mortgage industry as it relates to bank and HUD foreclosures, and sub-prime loans. As all the negative energy around mortgage financing has evolved, the impact to the national housing market has been noticeable. On the surface, there appear to be fewer buyers in the marketplace, but significantly more homes to choose from for those buyers who view this as an opportune time to buy.
That’s the perception and there is some truth to that. But, from the perspective of reality, here is a brief overview of the real estate market for single family homes for the past seven years from IRES, the Northern Colorado MLS, through July of each year.

Compared To Compared To
Previous Year Previous Year
Year New Listings % of Change Sales % of Change Absorption Rate
2007 17,063 -8.51% 8,461 -3.00% 14.1 Months
2006 18,652 +4.89% 8,723 -6.24% 15.0 Months
2005 17,782 +2.75% 9,304 +0.76% 13.4 Months
2004 17,306 +6.05% 9,233 +9.74% 13.1 Months
2003 16,318 +8.91% 8,413 No Change 13.6 Months
2002 14,983 +6.99% 8,426 +1.88% 12.4 Months
2001 14,003 —– 8,270 —– 11.9 Months

Some Observations …
1. Here is the average number of single family homes sold per month (day) for each year from January through July: 2001: 1181 (39); 2002: 1204 (40); 2003: 1202 (40); 2004: 1319 (44); 2005: 1329 (44); 2006: 1246 (41); and 2007: 1208 (40).
2. The Absorption Rate (The time it takes for the market as a whole to turn-over; assuming there are no new listings and the sales rate stays the same.) has improved thus far in 2007 over 2006. That’s a good indication that the real estate market, at least ours, is on the upswing.
3. The number of new listings thus far in 2007 is down about 8.5% over 2006. The number of sales is down 3.0%. Fewer listings overall, but sales off only about one home per day.

Our real estate market isn’t quite as bleak as it might be perceived. But, there is still room for improvement before the market becomes more balanced, where buyers and sellers interact on a level playing field. Home sellers need to continue to be realistic and aware of market conditions and competition. Buyers, to some degree, still rule.

This entry was posted on August 20, 2007 at 10:33 pm and is filed under Real Estate. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response or trackback from your own site.