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The number of unsold homes in the Denver area continues to decline. In October there were 23,120 homes on the market, a 20.1% drop from 2007!  Inventory hasn’t been this low since January 2005, when there was slightly less than 21,000 homes available.

One of the primary reasons for the lessening inventory is the fact that would be home sellers, are not putting their homes on the market given the current conditions.  Many sellers we work with are choosing to be landlords, or just sit tight until the competition from bank owned properties subsides.  Unfortunately, they may have to wait a while.  I predict the REO properties will continue to dominate our landscape for the next 6-9 months.

Another reason for the smaller inventory numbers is that we’ve seen investor money start to pour in.  There has been 3 occassions in the past month where Get Home Denver Team clients, have lost buying opportunities due to bids on properties we identified.  These multiple offer scenarios are a good sign that this market is on the rebound!

There are some really good deals out there, and investors are starting to gobble them up!  We scour the market on a daily basis, and present these deals to our clients.  If you would like to be included on these deals, simply contact us and I’ll make sure you are receiving this info!

The next 45 days will tell us a lot about the state of the State.  Or, more precisely the state of the Denver area in terms of the real estate market.

A quick historical overview.

• The Denver Real Estate market started to flatten out in 2001.  15% annual appreciation slowed to less than 6%.
• The Denver Real Estate market had very little appreciation from 2003-2005
• From 2005-2007 the Denver market dropped at a fairly steady pace.  Prices corrected over this time by over 15%
• From March 2008 to September 2008 the Denver Real Estate market appreciated, or stayed even, each month.

Analysis of 2008

I’ve been saying since January of 2008 that the Denver Real Estate market was on the mend.  We had hit bottom, and were ready for the eventual upswing.

In February 2008, we were finding many GREAT values for investor clients to purchase.  Values of homes that were 20%-30% below that of 2005.  Today, these deals are few and far between!  There are still some great deals to be had, but the weeding out process is much more difficult, and the competition stiff.

The recovery process has been slower than I anticipated, but the numbers are bearing out this prediction.  The Denver Real Estate market has been bouncing off the bottom for 7 months, and the upswing is near.  Or, is it?

The past 2-3 weeks have seen a dramatic DECREASE in activity. Historically the Real Estate Market takes a breath before an Election, and the gravity of this Election, along with the National Economy and the woes of Wall Street, have inflated the problem.  There is a definitely a “Wait and See” attitude in the buyer population right now.

So, in my opinion, the next 45 days will tell us everything about this market that we will need to know. The election will be behind us, and the country, along with consumer confidence, will no longer need to worry about the leader of the free world for the next four years.  Americans can get back to work, and back to living.  And, we can all move on from the uncertainty, fearmongering, and mudslinging that comes standard with Presidential Elections.

I think we will see the months of November, December and January be some of the best months for home sales in many years (compared to the same months in years past.)

The reason for this is there is HUGE pent-up demand from home buyers. There are 1000’s of first time home buyers in the market with month to month leases, looking for the right opportunity to jump into the market.  There are 1000’s of people, who have a home to sell, that would love to buy up, or buy down, and take advantage of the depressed pricing.  This group has been sidelined because they have been unable to sell their current property for what they believe it is worth.  These people are looking to VOLUNTARILY move, and as such, have decided to “wait it out” rather than take the necessary beating to sell over the past year.

If I’m wrong, and the next 45 days don’t show any improvement, it’s my fear that we will be looking at late spring, early summer to see the rebound begin in earnest.

So let’s get this Election over with already!

What do you think?  Do you believe the Denver market is ready to rise?  How about Nationally?

photo credit: Ricardo Carreon

For Denver area Real Estate, the number of unsold homes in September dropped to the lowest level since December 2005 and the number of homes placed under contract jumped almost 22 percent from September 2007, the best September for sales in three years.

The average and median sale prices of homes, meanwhile, have fallen back to 2002 levels.

Certainly we’re not out of the woods yet, but this data continues to confirm our belief that the end of this down cycle is near!  My 17 years of experience have been telling me for months that we are in recovery mode.  Since March of this year, the Denver market has actually seen appreciation.  Less than 1%, but it’s certainly better than depreciating at 3%-5% per month like some other markets!

The latest Case-Shiller real estate market report shows Denver faring better than most other parts of the country.

With all of the economic uncertainty across the country about the real estate market, Denver, Dallas, Detroit, Boston, and Atlanta are appearing to have turned the corner.

Note:  Take one month stats and annualize them to get a picture as to the direction of the market.  For example Denver was up 1.01% for the month which equates to a 12.1% annual gain.  Which is obviously MUCH better than the previous year of -4.7%.  Now compare to Vegas at -4.36% or an annualized 52.32% loss! This would indicate they are still going down, while we have started to recover.

.                                           Jun 08-Jul 08                   Jul 07-Jul 08

Minneapolis                              1.93                           -13.10%
Denver                             1.01                     -4.70%
Dallas                                       0.78                           -2.50%
Detroit                                      0.53                           -16.70%
Boston                                      0.27                            -5.40%
Atlanta                                     0.15                            -8.20%
Tampa                                    -0.04                            -19.40%
Cleveland                               -0.32                            -7.80%
Charlotte                                -0.44                           -1.80%
Chicago                                 -0.53                            -10.00%
Portland                                 -0.82                            -6.60%
New York                               -1.47                            -7.40%
Seattle                                   -1.77                            -8.20%
Washington DC                     -2.11                             -15.80%
San Francisco                        -2.95                             -24.80%
Miami                                    -3.03                             -28.20%
San Diego                              -3.17                             -25.00%
Los Angeles                           -3.19                            -26.20%
Phoenix                                 -4.1                              -29.30%
Las Vegas                             -4.36                             -29.90%

20 City Average                    -1.46                             -16.30%

With all the turmoil in the financial and real estate markets, I am constantly striving to provide up to date information and data on what is REALLY going on in the Denver Market.

I’ve found a couple of sources of live, dynamic information that I will provide to you.  I have a new “Market Research” tab on the Top navigation bar.  Click here to see charts that are automatically updated with the latest data available.

Real Estate is local, and without local facts and figures it is easy to get the wrong view of the market place.  Therefore, take a look and make up your own mind.

If you have questions on how to interpret any of the data, please contact me and I’d be happy to explain what all the metrics represent.

The number of homes on the market, in the Denver, area plunged by 20 percent in August from a year earlier, the largest percentage drop in five years.

According to data from Metrolist, there were 24,648 unsold homes on the market last month, compared with 30,827 in August 2007.

This is very good news and reflects what we’ve been seeing also.  Home choices are not what they were 6 months ago.  However, there are still many options for those looking to buy right now.

Year to Year pricing is way down for August.  Both the median and average prices of single-family homes sold last month showed double-digit percentage drops.

The average price of a single-family home was $284,531, down nearly 14 percent from $329,783 in August 2007.  And the median price of a single-family home was $225,000, down nearly 13 percent from $257,500 in August 2007.

This data is skewed slightly as it takes the entire Denver Metro area into consideration.  There are many parts of town where both average and median prices have actually gone up in the past year.  Additionally, from June to August of this year, prices have been on the rise.

This is another indicator that the market is at, or near bottom.  Contact us if you have any questions, or would like further information.

This video is very informative and explains the reasons for real estate market corrections. It also gives an historical perspective of where we’ve been, and the inevitable result of any downturn. A big shout-out and Thank You to Ted Mackel and the Homebuysblog from Simi Valley, for finding this gem!

Explaining the market is much easier than Timing the market. Timing is a much harder thing to predict. We believe the Denver Real Estate market is at, or very near the bottom. Read some of our previous articles, or better yet subscribe to our feed. You will then always be on top of the important statistics that will help you make up your own mind.

We always love to hear what you think! What are your predictions for the Denver Market? If you are thinking of a home purchase, or sale, when do you think it will be the right time to pull the trigger? What factors do you look at when making this decision? Etc…..

PMI, Private Mortgage Insurance, is required on most mortgage loans in which the borrower has less than a 20% equity position.  These insurance companies charge the borrower a premium to benefit the mortgage lender in case of default.  Part of their insurance rate analysis includes an in-depth analysis on the potential for property value decline.  Obviously, a large concern for everyone today.

From The PMI Group, Inc.

Risk scores translate directly into an estimated percentage risk that home prices will be lower in two years. The Summer 2008 Risk Index is based on first-quarter Office of Federal Housing Enterprise Oversight (OFHEO) data.

The Great News, Denver is one of only only 14 areas in the country, with a less than 1% risk of prices dropping in the next two years!

To see the other 13 areas, click here.

Here are some recently compiled market stats for April 2008. My market area is the South Metro Denver cities, including Denver, Centennial, Greenwood Village, Cherry Hills Village, Englewood, Aurora, Littleton, and Highlands Ranch.

Big Picture (Covering the Entire Metro Denver Area) The figures are for single family residential properties only, and do NOT include Condos, Land or Commercial data.

Total Closings for the Month: 3,353, Down 3.4% from 2007, Up 12% from previous month.

Average Days on Market: 103, Down 4.6% from 2007, Down 5.5% from previous month.

Active Listings: 20,477, Down 2.1% from 2007, Up 3% from previous month.

Average Sold Price: $267,259, Down 17.1% from 2007, Down 2.7% from previous month.

Absorbtion Rate: 5.8 Months, Down 10.8% from previous month.

South Suburban Central & South Suburban East MLS Market Areas (This data covers the majority of Greenwood Village, Cherry Hills Village, Englewood, Littleton, Centennial, south Aurora, and un-incorporated Arapahoe County.)

Total Closings for the Month: 211, Down 12% from 2007, Up 40% from previous month.

Average Days on Market: 109, Up 3.2% from 2007, Up 12% from previous month.

Active Listings: 1313, Up 5.2% from 2007, Up 23% from previous month.

Average Sold Price: $443,160, Down 15.1% from 2007, Up 6.5% from previous month.

Absorbtion Rate: 6.7 months, Down 5.2% from previous month.

The biggest take away from this data is the fact that the marketplace is absorbing properties quicker and quicker. The 6 month absorbtion rate is historically the line in the sand between buyer’s and seller’s markets. Anything less than 6 Months, is perceived to be a Seller’s market and anything greater than 6 Months favors the Buyer’s. Prices continue to be down year over year, but that was expected as we have all lived through this market decline.

All in all it is pretty much what I expected, and it continues to indicate the market conditions are improving.

Click Here to download the full report in .pdf format. April 2008 Market Stats

More news today on some HOT markets in the Denver area.

As reported in the Rocky Mountain News, certain Zip Codes are doing extremely well! Over the past year, the median price in the Denver Metro Area has fallen. But certain areas are going UP. The top 5 areas are:

1. Centennial, Cherry Hills Village, Greenwood Village 80121 UP 26%

2. Denver 80212 UP 18.5%

3. Golden 80403 UP 15.4%

4. Denver 80215 UP 14.6%

5. Greenwood Village, Englewood 80111 UP 13.2%