Time magazine reported that 16 percent of all sales contracts failed in July because the buyers could not secure a mortgage, according to figures from the National Association of Realtors. In other words, one out of every seven contracts is going down due to problems that buyers are having getting mortgages. To look at it another way, writer Alison Rogers says, there are tens of thousands of people who are trying to buy homes but can’t because they’re denied a loan.

In her article, Rogers – a Manhattan Realtor and founding editor of the New York Post’s real estate section – concedes that it’s possible that the system is doing its job, and that those denied buyers shouldn’t get loans. “Maybe they’re poor credit risks, or their employment isn’t stable, or they’re trying to overpay for their target properties,” she said. “But I doubt that’s the only thing going on because the percentage of denieds spiked so suddenly, from 4 percent in May to 16 percent in June.”

While July turndowns are steady from June, it does look to Rogers like that quadrupling earlier this summer reflects that, “a credit spigot was shut off very, very suddenly.”

Cash purchasers, on the other hand, haven’t fled the market. Some 29 percent of July sales were all-cash transactions.  NAR reports that “the bulk” of these are investors.  “Those with means, it appears, still believe in housing, perhaps lured by the slump’s relative bargain pricing. (Or they’re fearful of the daily rollercoaster of the global equities markets),” the Time article noted.

Difficulty in securing financing isn’t the only hurdle buyers are facing today. Local Realtors are reporting that surprisingly low appraisals are preventing many sales from going through. Colorado agents aren’t the only ones who are experiencing this issue. The Wall Street Journal, in a recent front-page article, noted Realtors all across the country are running into the same problems.

According to the Journal’s reporters, real estate appraisers, who were criticized by some for being too generous in their property valuations before the housing market fell, may be going overboard in the other direction.

“One of the conclusions from the housing bust: The appraisal system was broken,” the Journal said. “One of the conclusions some have drawn from the struggling recovery since then: The appraisal system is still broken, but in a different way. There is little doubt that home values have depreciated sharply in recent years for the most basic of economic reasons: excess supply of homes on the market and weak demand. But some realtors, home-sellers and economists believe low-ball appraisals also are undermining a housing recovery.”

The Journal said some real estate professionals believe that lenders are pressuring appraisers to come in with lower estimates. Banks also are using less-experienced appraisers, who often don’t appreciate factors that make a home worth more, they say. And valuations are being heavily influenced by distressed sales priced at a discount to the rest of the market.

Lenders are “instructing appraisers to be a little conservative, and that responsibility on the one hand is seen as credit tightening and, on the other, as exacerbating the housing problem,” Columbia Business School economist Chris Mayer told the Journal.  A research paper last year titled “How Much Is That Home Really Worth?” by economist Leonard Nakamura at the Philadelphia Federal Reserve, cited a downward bias in appraisals.

In talking with my own agents around Colorado, I’ve heard many anecdotes about sales being slowed down, renegotiated or even lost due to appraisal and mortgage financing issues. It does seem to be happening more and more these days.

While it’s important for lenders and appraisers to be cautious and prudent given the problems of the past, they also need to be reasonable in their approach and make sure that the pendulum hasn’t swung too far in the other direction. The recovery of the housing market is too important to throw more hurdles in its path

Below is a market-by-market report from our local offices:

Boulder – The last two weeks in August tend to slow down due to parents getting kids back to school.  While the numbers are down when comparing these numbers to two weeks ago they are not significantly down from the same period in 2010.  Only new listings taken are down significantly during the same period in 2011 & 2010.  This is a continuing trend in 2011 of the lowest inventory levels in the past ten years when comparing month to month levels such as August to August.

Colorado Springs – Our showings and sales have been staying steady overall.  Most of Colorado Springs’ school districts have started back to school over the past few weeks.  This is keeping our listing inventory at a steady level, as buyers have tried to make the transition into the district of choice by now.  Buyers are still in the market to purchase homes with interest rates in the local market still at historic lows for a 30 year loan.  Foreclosure activity has shown a sharp decrease in our market.  Overall, we currently see a very steady Real Estate Market.

Denver Central – It still looks like we are holding our own in the market.  For the last couple of months everything seems to be pretty steady.  I feel a lot of move-up buyers are still on the fence right now waiting to see what the politicians do and to see what happens with the stock market.

Larimer County – Our median sales continue to creep upward with the July median sales price for single family homes in Fort Collins, tipping over $250,000.  With the majority of closed units in the $250,000-$299,000 price range, it is readily apparent that this price point is the hot ticket and stabilizing prices for well-maintained homes in desirable locations.  There are still lots of great deals out there both below & above this range – but the qualified buyers are fewer and farther between.  Investors continue to snap-up investment properties as the rental market continues showing market strength with vacancy rates in the low 6% range.  With the days getting shorter and autumn quickly approaching – there is some great inventory in the marketplace with super-favorable interest rates.  Don’t wait until the newspaper or CNN or Case-Schiller tells you that the market has turned for the better.  It may be too late!!!  Contact your Coldwell Banker agent today for a market snapshot of your home and see where it sits in the current marketplace!

North Metro – The Coldwell Banker North Metro office continues to help buyers & sellers close on homes. We are set to close 110 properties in August, which is up slighlty from a year ago at the same time.  We put 40 new homes on the market in August with prices ranging from $80000 to $1,500,000.  We experienced a little slow down the first part of August in the number of showings our listings were having.  Was it vacations? Getting the kids back to school?  We’re not quite sure what to attribute that to, but in the past week we’ve seen an increase in the showing activity & at open houses.  If a home is priced “to sell” in this market, we’re seeing multiple offers.

Parker – Finally, we are seeing more homes hitting the market again.  With the increasing listing inventory, the showing activity is going up as well.  Our sales activity is holding steady on a higher level than the recent months.  Because of the stable, low interest rates and with the steady buyer activity, values have stabilized in most of Douglas County!  Parker is preparing for the big Ride the Range event, Monday September 12th.  We are expecting the riders around 2:15PM.  What a great experience it will be!

Denver Central – Our agents are very busy with buyers.  Believe it or not, we are lacking good, saleable properties.  When we contact a neighborhood directly with a request to sell to a qualified buyer, we get several responses from potential sellers.  The sellers seem to be hesitant to place their homes on the market, yet they want to sell.  I would encourage sellers to contact a CB Real Estate agent for a market analysis to see if it makes sense at this time to sell.

That’s it for now!  Make it a great week!

Chris

With that in mind, our parent company, Realogy Corp., has issued a formal request to President Obama calling for a White House summit on housing to address some of the major hurdles holding back the housing market. Richard Smith, chief executive of Realogy, urged the President and his Administration to seek recommendations from real estate business leaders to help stimulate a sustained housing recovery.

As Smith noted, housing has an enormous impact on our nation’s GDP and given its substantial influence on all aspects of the economy, he believes it warrants special attention from the White House.

The key to the proposed White House summit on housing would be its emphasis on bringing together real estate business leaders to make actionable recommendations designed to stimulate the growth necessary for a sustained recovery in housing, which would have an ensuing positive effect on job creation and the broader U.S. economy.

Frontline business leaders from the residential real estate industry would add a valuable perspective to the process, and the summit would give the Administration the benefit of “unfiltered, real-time market feedback” from residential brokerage operators, real estate franchisors, homebuilders, mortgage lenders and other related industry groups.

In a letter sent to the President last Friday, Smith concluded by saying “your leadership on this issue would bring together the top business minds of the residential real estate industry at a time when practical business experience may very well offer the guidance necessary to stimulate housing, and thus, the U.S. economy.”

I’m proud that Coldwell Banker (through our parent company) is taking a leadership role on finding solutions to get the nation’s real estate market humming again. While there are many challenges facing our economy, much of it begins and ends with housing.

Below is a market-by-market report from our local offices:

Colorado Springs – Our showings have been increasing since July 4th and that gave us a very good sales month for July.  Our listing inventory has remained steady with quite a few sellers wanting to move up because they can still get a great deal on interest rates which remain below 5% for a 30 year loan.

Denver Central – Currently, some of our agents are very busy but showings have dropped off the last two weeks.  The thought is that people are waiting to see what happens with the government deficit ceiling vote in Washington.  Sellers are definitely more realistic on their listing prices now.  “It’s a price war to the door, then a beauty contest after that.”

Evergreen – Our listing inventory has increased with a total of sixteen new listings for July totaling $7,300,000 including seven luxury properties and ten listings sold during the month.  Showing activity has increased 18% in July compared to June with 353 showings.  Our selling activity is steady with a total of eleven listings totaling $3,800,000 going under contract including two luxury properties.  Seven buyers have also gone under contract during the month.

Larimer County – The debate over raising the debt ceiling put the brakes on more things than just our politician’s summer vacations!  Locally, we’ve seen a decline in showings that coincides with the deadlock we saw in Washington.  It also probably coincides with just-before-school-starts-again vacations or perhaps the slow-down is simply because Mercury is in retrograde….Either way, activity has slowed in the weeks prior to the back-to-school doldrums that are typical for this time of year.  Prices remain steady and inventory is still lower than in years past.  The next hurdle will be making sure that if you’re buying, you can take advantage of what still are historically (or perhaps hysterically) low interest rates!

Southeast Metro – Happy August!  The summer temperatures are still hot & the real estate market is heating up as well.  We are still in a situation where we have buyers who would like to purchase as soon as possible & the homes that they look at, that are priced correctly for the market, that are neat & clean are gone before the buyers can come back for a second look.  The upper end of the market, homes about $500,000 are seeing lots of activity also. We have had many successful sales & increased activity in this sector of the market. The ultra-luxury area, over $1,000,000 is now showing a nice increase on sales in the sector. “Slow & consistent growth” seems to sum up the numbers.  We are encouraging all sellers who are considering putting their homes on the market to do so as soon as possible since historically we will see a surge in activity as we move into the end of summer.  Happy Colorado Day from all of us at the SE Metro office.

Southwest Metro – We’ve seen our showings decrease in the last two weeks of July.  Our Open House activity has continued to be very good & has been generating great leads.  Our floor calls also continue to be a great source of business.  We are continuing to see buyers ready to move forward in purchasing homes especially second time home buyers.  We’re seeing sales continue to be very good & steady.  Our inventory is steady.  Sellers are continuing to want to get their homes listed & sold.  We are not seeing as much buyer hesitation as in previous months.  We are very busy & staying very busy.

Conifer – Our listing inventory has remained stable with four new listings & four listings closed for the month of July.  Showing activity decreased slightly with 143 showings compared to 165 in June.  Sales activity remained steady with six listings and three buyers going under contract during the month.  Activity in the HWY 285 corridor is primarily in the $200,000 to $300,000 price range.

That’s it for now. Have a good week!

Chris

After a modest spring, the local housing market has been heating up this summer with strong sales in June and even into July in many areas. Sales activity has been especially robust in the higher end of our markets.  But even the mid-level market was surprisingly active (more on that below).

As I was combing through last month’s sales figures, I noticed an interesting trend: In most of our Colorado markets in June we saw a higher number of million-dollar home sales, in some cases the highest since 2008. You might recall that was just weeks before the collapse of Lehman Brothers sent the financial markets into a tailspin and pushed our economy into the “Great Recession.” Now, three full years later, we’re seeing a much brighter picture for the local housing market.

The high-end of the market is not the only segment doing well. The entry level and mid-level markets have shown solid signs of improvement as summer rolls along.

The only thing holding back the lower end of the Colorado market in many cases has been a lack of inventory. Inventory remains elusive in many markets. Because of the shortage of good, well-priced homes, multiple offers are picking up in many communities. In nearly every one of our regional markets, you can almost be assured of multiple offers for a well-priced, well-located, and nicely staged home in the entry price level for that market.

Clearly, Colorado’s relatively strong economy, is playing a key role in our housing market.

This all is not to suggest the housing market is completely out of the woods. Real estate is very much a local business. And while many of our markets are on the mend, others are still softer than they were a few years ago. And there still is an overhang of distressed properties that will continue to come on the market as bank owned REO sales in the months ahead.

While we take quite serious the nation’s fragile economy, and most recently the stalled talks to come to terms with our national debt limit, we can be thankful for the Colorado real estate activity that continues to move forward.  We are fortunate to live and work where we do.  The limited housing stock, diverse job base, incredible universities, and great weather are all factors that help homebuyers focus on these terrific home values and low mortgage rates.

Below is a market-by-market report from our local offices:

Boulder—Our showing numbers have dropped by 33% over the past two week period and the under contracts and pending contract categories have experienced a similar drop.  This is the slow down that takes place every year with families beginning their summer vacations and taking advantage of the extended time off created by the fourth of July holiday weekend.

Colorado Springs—Our sales have increased and our agents still have a lot of buyers that they are working with.  Our listings have decreased but a big part of that has to do with sales and the July 4th holiday.  Showings have been steady during the week but very slow on weekends.

Denver Central—It seems that over the recent 4th of July weekend, everyone took the weekend off.  Our listings have slowed down the last two weeks.  It seems that families are taking  vacations & time off.  Our under contracts are still holding steady which is good.  It appears that the $500,000 has slowed down a bit, but the under $200,000 which show well and are in good condition are doing well.

Evergreen—Our listing inventory has increased with a total of 27 new listings for June, totaling over $13,000,000 and including 11 luxury properties. Our showing activity has increased by 50% this lst June compared with 300 showings in May.  Selling activity has improved with a total of 16 listings totaling almost $6,500,000 going under contract including four luxury properties.  Sixteen buyers have also gone under contract with a total volume of $5,000,000.

Larimer County—June sales for the office will likely fall short of last year’s run-up to the end of the Homebuyer Tax Credit but the open contracts for July demonstrate resilience for our mid-summer sales season. July may end up as our peak sales month as was the norm prior to 2007.  Showings remained at seasonal highs right up until the Independence Day holiday weekend where the numbers fell off dramatically.  Activity is likely to rally back quickly as buyers start thinking about getting into their new home before the start of school in mid-August.  The summer heat is upon us & the afternoon monsoon rain pattern has begun in earnest.  Everything is green & beautiful & if your home isn’t already on the market – now would be a great time as inventory levels remain substantially below the last several year’s numbers.  Activity has broadened in to the higher price ranges of the three hundreds where earlier in the season sales have been dominated by the under $300,000 price point.  Vacancy rates within the residential rental market remain at stunningly low rates & it appears as though lease rates are inching up with demand outstripping supply.  This trend appears likely to remain in place for the next several years.

Parker—Our sales activity has picked up again.  It looks as if as more buyers are realizing that not only values have become more stable, but also the interest rates will go up in the second half of the year.  The decreasing inventory is reflected by the lower number of showings. Now is the time to put homes on the market before the activity slows down towards the end of the year.

Southeast Metro—Welcome to July!  What a June it has been – we have seen much better activity as we roll into summer.  With decreasing inventory, we’re seeing multiple offers on properties & buyers not getting the homes that they really wanted.  If buyers are trying to put in a low offer & try to see what the seller will actually sell for, they are losing out.  Buyers must come in as strong as possible on their initial offers.  Seller would be well advised to get their homes on the market NOW & take advantage of all the motivated buyers out there.  If sellers price their homes correctly, considering condition, location & market statistics for the neighborhood , they will be very pleased with the results.  In the upper end, we’re seeing an increase in buyer activity & homes are moving in this sector also.  Price is so important & sellers would be well advised to choose their agent & the agent’s brokerage with a keen eye to what that agent & the brokerage provide to get the job done.  In this full service world, this choice will make a huge difference in a successful sale, in a timely manner.  Here’s to a successful summer!

Southwest Metro—Even with the 4th of July weekend, our showings were still very good.  We had a tremendous number of listings over the last two weeks as well as contracts to purchase homes.  Open houses have been very busy as well as our floor calls.  We are seeing a good amount of activity in the price ranges between $300,000 to $450,000.  Our agents are seeing clients ready to move up to larger homes & are feeling good about the economy & ready to list and buy.  Sellers and Buyers are no longer waiting and are ready, willing and able to move forward.  There is very good and positive activity in our office as well as with our clients.

Denver West—The Denver West office is in the summer real estate market frenzy.  Listings that are in show condition & priced for the market are receiving multiple offers.  Many of these homes are priced in the $250,000 to $400,000 price range.  Buyers have quickly learned that if they love a home, they need to act relatively fast in regards to making an offer.  In addition, they need to make a realistic offer or they risk losing the home to a multiple offer situation.  We’ve had some situations where our listings have gone under contract & have back-up offers as well.  In this situation, the buyers in first place need to be realistic in regards to their inspection notice requests.

Connifer—Our listing activity has stabilized with eight new listings for the month of June.  Showing activity has increased 77% with 165 showings in June compared to only 93 for May.  We had six listings that went under contract and five buyers that went under contract.  The majority of showing activity in the HWY 285 corridor is in the $200,000 to $300,000 range.

That’s it for now. Enjoy the summer weather, and have a great week!

Chris

The Thomson Reuters/University of Michigan final index of consumer sentiment increased faster than expected to a three-month high of 74.3 from 69.8 in April. Economists had forecast a reading of 72.4, the same as the preliminary figure issued earlier this month, according to the median estimate in a Bloomberg News survey.

The upward trend is encouraging for those of us in the housing market. As real estate people know all too well, consumer confidence plays a critical role in the housing market. If buyers are positive about their job prospects and the overall economy, they’re more likely to take the leap into buying a home or trading up to a larger one.

Also encouraging: U.S. corporate earnings continue to improve. In a new report, Deutsche Bank said that earnings for the first quarter beat analyst median forecast by a full 50%. Earnings for the three-month period surged 18 percent year-over-year, far exceeding the 12 percent expectation at the beginning of the quarter.

This marked the ninth consecutive quarter of sequential earnings growth. Earnings were driven by cyclical sectors such as Materials (up 55 percent), Energy (up 40 percent) and Industrials (34 percent). Altogether, revenues rose by a healthy 9 percent for the quarter, an indication that earnings were not solely driven by cost cutting, a very good sign.

But despite the overall improvement in the economy and the financial markets, the nation’s housing market overall continues to struggle to gain momentum. Pending sales of existing U.S. homes dropped more than expected in April to touch a seven-month low, the National Association of Realtors reported on Friday.

NAR’s Pending Home Sales Index dropped 11.6 percent to 81.9 in April, the lowest since September. Pending home sales lead existing home sales by a month or two. Economists, who had expected pending home sales to fall 1.0 percent last month, said bad weather in some parts of the country might have affected home shopping.

So what to make of the mixed bag? Overall, the nation’s economic recovery is moving forward, albeit at a modest pace. Nationally, the housing market is fighting to work through the overhang of foreclosed and distressed properties. It’s not easy, and will take time. But it will happen.

However, more than ever, we’re reminded of how much real estate is about location, location, location. Things are far better here in Colorado. The overall market is much more stable than elsewhere in the nation, and in some pockets, actually fairly robust.

To learn more specifically, take a look at our latest market-by-market report from our local offices:

Colorado Springs—Our market has been steady the last few weeks.  Showings have remained steady during the week but slow on the weekends.  Sales have improved over the past weeks by about 20% as buyers are taking advantage of very low interest rates.  This has caused a decrease in listings, but we expect that to change in the upcoming weeks.

Devonshire—Our showing and overall activity seem to be increasing in and around the office.  Brokers seem to be very busy with listing preparation and contract preparation. It is a little harder to gauge actual broker activity as our office construction has quite a few of our brokers working from home.

Denver Central—We seem to be steady in the downtown Denver area.  However, with FHA mortgage insurance going up on April 18th, it is affecting some of the lower end buyers and what they qualify for.  New listings are slowing down because parts of the foreclosure market are slowing down possibly because some of the banks are holding back some inventory.

Larimer County—If Pomp & Circumstance is ringing in your ears – it is certainly drowning out some of the activity here in Fort Collins.  Showings dropped quite a bit in the last two weeks as high schools & colleges captured most of the public’s attention.  While our office is taking more and more listings, the inventory at large is still substantially lower than in previous years creating pressure and limited availability in some price points. Interest rates have remained surprisingly stable in spite of the projected end of the Fed’s Quantitative Easing.  One recent development that Buyers should take advantage of is Coldwell Banker Home Loan’s single premium mortgage insurance option.  On a $210,000 loan using this program, buyers can save in upwards of $100 a month on their mortgage payments as compared to conventional PMI.  That kind of savings can really add up to more buying power!  Contact your local CB branch to get more details!

Longmont—The summer busy season has hit the Longmont area.  Buyers are attending graduations, weddings and end of school events.  Our showings have taken a dip this last reporting period.  Investors are in the market to purchase.  They are looking at bank owned properties & HUD listings for the most part.  They are shying away from short sales due to the uncertainty of timing associated with those properties.  Appraisals are once again becoming an issue in getting deals done.  It is so true that real estate is local…very local…from one subdivision to another subdivision it can make a world of difference in values.

North Metro—Many sellers are preparing their homes to put them on the market now that it is becoming the height of the buying season.  The agents in our office have already listed 60 properties this month.  Due to the competition and number of homes on the market it is so important that sellers ensure their home is staged, the yard pristine & priced correctly for the market.  Open house activity has increased as well. This month we have already placed 114 homes under contract.  This is a large increase from this time last year.  We’ve had several agents that put on Neighborhood Garage Sales.  You don’t want to miss these as many homes participate in this great event.  Visit us at the Denver Century Ride on June 11th & 12th at INVESCO Field.

Parker—The steady activity and the number of listings over the past few weeks have caused the prices in most neighborhoods to stabilize.  Although we are not at a point yet where we can declare a balanced market, it is visible.  The decline has slowed down and even come to a halt in many areas.  The continuous inclement weather has caused showings to decline slightly.

SE Metro—Here we are in the full swing of spring.  What we are seeing is that if you are out looking for homes & you see something that you like & that meets your needs, you had better get an offer in to the sellers.  Houses that are in good areas & in nice shape are selling very quickly, often with multiple offers. Now is the perfect time to get homes onto the market.  When we have a new listing in the office, we usually see more than five showings in the first week.  The consumers are really realizing that with interest rates at historic lows, now is the time to move forward.  No one can say what interest rates will do going forward.  In the upper end of the market, we are seeing houses going under contract faster than we have seen in some time.  Once again, sellers need to get their homes on the market as soon as possible.  The pent up demand is leading to a shortage of homes available for buyers so we will see prices begin to escalate.  Now is the time!

SW Metro—May started out a little slower than April however we are back on track.  Our agents have been very busy with buyers and sellers.  We are still seeing buyers actively seeking to buy homes. Our mortgage rep has been very busy these past two weeks, he is seeing a steady flow of buyers ready to buy.  Open houses have been very busy & have provided good leads.  Floor continues to be active. We’re seeing homes in the $300,000 to $450,000 range doing very well in  our market.  Interest rates are great and we are getting our message out there that a mortgage is sometimes cheaper than renting.  Our market at this time has been good & we look forward to a good spring/summer.

Denver West—We attribute fewer showings to high school activities, graduations, Mother’s Day and other events in May.  Denver West agents are still very busy listing and selling properties.  We believe that buyer’s now believe the information they received about historically low interest rates, great inventory and low home prices.  Sellers that are priced right are experiencing an offer within a week and two or three times a week we see multiple offers on properties.

Loveland—It was great to have our showing activity return to normal.  Sellers are realizing this is the time to put their homes on the market.  Potential sellers are asking for full service realtors.  They know that marketing their property is best done by a professional.  New home activity is picking up.  Builders are once again selling from model homes & offering quick build times.  We are seeing activity in Loveland by businesses ready to service the companies that will be associated with the ACE project.  It is an exciting time in Loveland and Northern Colorado.

That’s it for now. Have a good week!
Chris

Bruce Zipf, president and CEO of NRT, our national parent company, said this week that despite trailing last year’s pace, our overall business results have managed to exceed expectations, thanks in large part to a surprisingly resilient high-end market.

Our company’s agents across the country closed 32 homes over $10 million in March, up from 10 last year and just six in March 2009. The total number of homes sold over $2 million is up 12%. There was particular strength in the luxury segment of the market in the Northeast, Florida and in California.

Normally, we judge the strength of the housing market by looking at current sales volume against the same time last year to gain a sense of how things are improving. But we couldn’t properly compare data from this March and April due to the artificial stimulus effects of last year’s Home Buyer Tax Credit. In May, these effects should lessen and give us our first true glimpse of the market’s strength.

Nonetheless, I’m optimistic that we’ll continue to see improvement in the market as we head into the heart of the spring buying season, especially right here in Colorado. Many of our local offices report seeing growing momentum from buyers looking to take advantage of mortgage rates while they’re still low, as well as prices that remain affordable.

In a number of our markets, we continue to have more qualified buyers than listings. This situation is resulting in multiple offers for many attractive homes, often bidding up the sale price over the asking price. Buyers are coming in with a lot of cash or all cash to win out the competition. My how things have changed since the depths of the recession!

This is not to say that every market around Colorado is experiencing the same strong buyer demand. Certainly a number of communities and even neighborhoods within those communities have more balanced markets, and some homes continue to sit while others sell briskly. But in general, we’re seeing well-presented, well-priced homes selling much better today than they did a couple of years ago.

Another reason for my optimism is that mortgage rates are likely to remain affordable for some time to come. I know a lot of market-watchers were concerned that the Fed could ratchet up interest rates soon in response to inflation fears and the end of the government’s bond-buying program. But Fed Chairman Ben Bernanke largely put those fears to rest in his first-ever press conference last week.

Although Bernanke signaled the end of its $600 billion bond-buying program, as expected, he made it very clear that he isn’t inclined to raise interest rates for a long time unless the inflation outlook worsens.  More than anyone, the Fed chairman is very aware that the economy continues to face headwinds in the form of high unemployment levels and a tepid housing market in many parts of the country. While things are certainly getting better, Bernanke isn’t likely to do anything to douse the nascent recovery.

So as we look to May and the summer season before long, there are many reasons to be encouraged that our housing recovery will continue to gain traction – especially here Colorado.

Below is a market-by-market report from our local offices:

• Boulder—Listings are down over the two week period & we are getting comments from agents that there is not enough selection in the upper end of the price range.  The number of contracts remained steady over the two week period while the number of showings increased by 15% over the past two weeks.  All three indicators add up to indicate continued cyclical growth as we move into the busiest months of the year.
• Colorado Springs—Our showings were up 25% even with the holiday as a lot of showings were set for Saturday.  Our listing inventory has remained the same because many of our buyers do not want to purchase a short sale (mortgage holder must approve the contract & that can take from 5 to 10 weeks).  Because of that our sales were down 20% from past weeks. This coming week is jam-packed with economic reports that can have a big impact on the markets & home loan rates which still remain at an all time low.
• Southeast Metro—Well, here we are at the end of April and real estate activity is in full swing.  We have seen consistent increases in showings on all of our listings, even those in the higher price points.  Buyers are finding that if they find a property that meets their criteria, they had better get an offer in or they have a very good chance of losing that home to another buyer as listing inventory has dropped somewhat.  In the upper end of the market, we also see consumers making buying decisions.  Days on the market has dropped slightly.  We encourage sellers in all price points  to get their homes ready by doing the cosmetic fixups that will make their homes stand out from the others on the market – fresh mulch and flowers for great curb appeal as well as updates of paint colors, decluttering and staging the interior of their homes.  Interest rates are still very appealing so now is the time for both sellers and buyers.  We’re looking forward to a much improved real estate season as we move into spring and summer.
• Denver Central—At our downtown, Denver Central office we have been pretty steady for the last couple of months.  However, these last two weeks our under contracts have almost doubled.  We think a lot of buyers are getting off the fence right now.  Our listings are beginning to drop off some. Our agents have a good positive attitude about the market.
• Larimer County—Activity is still brisk with our office showing data increasing week over week.  There are numerous reports of multiple offers on well-priced homes & while the sales pace has slowed somewhat, it appears to be more Easter/Passover/Graduation related than anything on the economic front.  The business news for Northern Colorado remains on the positive side as local companies have shown positive quarterly earnings & slow but steady signs of growth.  Housing inventory levels remain at 10 year lows which will certainly help minimize the downward pressure on prices – but serious Sellers must be aggressive & take a hard look at the market to ensure that when their home goes on the market, it is priced to get the attention of the Buyers that are ready to buy right now.  Interest rates are relatively steady but creeping upward which can begin to limit a Buyer’s purchasing power.  The best bet is to contact a Coldwell Banker Home Loan mortgage advisor & get locked in on a great rate right now!
• Longmont—Activity is happening in the Longmont market!  Showings are up to usual Spring levels.  The agents holding Open Houses are seeing good traffic.  Educated buyers realize this is the time to purchase.  Short sales and foreclosures are still a part of this market and they are impacting some neighborhoods in a large way.  Financing for the marginal buyer continues to be a challenge, however the well qualified purchaser has some great financing options.  First time buyers are finding great values here in Longmont.
• Parker—The last couple of weeks have been very active again.  Our listing inventory is decreasing and our agents are writing more contracts every week.  Forecasts tell us that the interest rates are expected to go up by a full percent by the end of the year which makes now the time to buy and to invest!  Also, if the inventory continues to decrease, prices will be more stable and begin to go back up!
• Devonshire—I believe that market activity seems to be improving based on the number of showings and contracts written.
• Southwest Metro—There is great activity in our office.  We are seeing buyers & sellers and they are ready to make their move.  Interest rates at this time are still very good and I feel that buyers are realizing that they need to get moving before rates begin to creep up.  The majority of sellers are pricing their homes to sell in this market.  Showings have been steady and open houses have been great.  We had three clients walk in looking to buy & our floor agents have been successful in converting these to actual deals.  We’re looking forward to a good Spring season.
• Denver West—We have properties that have been on the market for sale for a year that are now receiving offers. Although the price has been adjusted down, it is clear that more buyers are in the market place.  Even though there is substantial inventory, oftentimes there is not “good” inventory.  Many homes in the 30+ age bracket desperately need new kitchens and bathrooms in order to help them to sell.  Typically, buyers want to move into a home that is “move in ready” or they want a real bargain if they need to do the updating.
• Loveland—The Loveland news that ACE (the NASA spinoff) is still huge news for Northern Colorado, Loveland in particular.  We are seeing more new home builder activity.  The price of these homes is mostly at the entry level for housing.  The builders are delivering a great product for the price!  Showing activity is inching up slowly but it is going in the right direction.  The general mood is that Loveland is poised to make a great recovery by the end of 2011.  If you are a buyer, looking for a bargain now is the time to be shopping!

That’s it for now. Have a good week!

Chris Mygatt

This year is no exception. The Colorado market seems to be gradually heating up along with the temperatures. Most of our local offices are reporting steady to improving sales activity and overall market conditions.

Don’t get me wrong. While many parts of the Colorado are seeing progress on the housing front, the picture isn’t uniform across the board. Some cities are experiencing stronger markets than others. In some communities, certain price ranges are hot while others are tepid. And even within a local market, while one property may get eight or 10 offers, another sits idle waiting for a single buyer.

Nonetheless, the recent uptick in activity in general is providing encouragement to Realtors as well as home sellers.

A variety of indicators—including investor and cash purchase levels and adjustable-rate loan use—are pointing toward a more normal market.  And while the housing market has certainly moved well back from its challenges two years ago, we still have a ways to go.

Distressed properties are still an issue in some counties and drag on prices.  Mortgage financing is still problematic for some borrowers as well.

What this tells us is, we appear to be moving in the right direction. I’m encouraged that the spring rejuvenation in many of our markets will continue in the months ahead, especially if the economy and the local job market continues to improve. Only time will tell.

Below is a market-by-market report from our local offices:

Boulder—Listings continue to grow as expected for the spring season.  The 24% growth from one, two week period to the next does feel larger than normal.  Sales are also continuing to grow in the market & have experienced an 18% growth over the past two weeks.  The number of showings has decreased by 5% on 600 showings in the previous week.  This would indicate slowing of leveling out in the growth of Buyers coming into the marketplace over the past two weeks.

Colorado Springs—Showings are back up to normal the past week with Friday and the weekend being busier than usual.  This has caused a slight decrease in listing inventory because more showings mean more properties going under contract.  Sales have been steady and most agents are staying busy.  They tell us just getting through the inspection and the appraisal is the hardest part of most of their transactions.

Denver Central—These last two weeks have been similar to the last two weeks in all ways.  It looks as if we are back to a steady market and hope to see an increase in sales activity soon.

Evergreen—Our listing inventory remains stable with the number of sales and new listings in balance.  We’ve had nine new listings so far this month with five listings put under contract.  This included a listing priced at $995,000 on the Hwy 285 corridor.  Showing activity has declined slightly with 115 showings so far this month but continues across all price ranges and property types.  Selling activity has also stabilized with three buyers put under contract including two in the luxury market.

Larimer County—Spring has sprung!  Tress are bursting with blooms & the early spring flowers are making their way out of the thawed ground.  In spite of drought conditions on the front range, the same cannot be said for the housing market.  Vigorous is the term that comes to mind as well priced  homes are coming on the market & going under contract in a matter of days rather  than weeks.  Many have multiple offers commanding full price or more!  Sales volume remains steady through March with inventory levels at their lowest since 2001!  In spite of year-over-year decreases in sales, units & volume. This is partially due to the artificial run-up in the market from last year’s tax credit incentive.  With recent news of the selection of Loveland as the preferred site for the CAMT ACE campus, increased energy exploration in the north, the jobs picture for Northern Colorado continues to get brighter.  If you’re thinking about selling – now may be a good time to get your home on the market to take advantage of the low inventory & improving demand.  Perhaps even trade up to the home of your dreams!

Longmont—The price of homes being shown & going under contract is creeping up in price.  Homes in the $200,000 to $300,000 range are the bulk of the activity. First time buyers are still in the market in a big way.  HUD has revamped the way that they are selling their inventory here in Colorado.  This has increased the number of HUD homes that our Buyers are making offers on. Short sales continue to be a long and drawn out process.  Cash deals can take two to three months to close.  We are all cautiously optimistic about this selling season.

North Metro—Spring is definitely in the air and activity is picking up.  In the month of March, the agents at North Metro put 121 homes under contract and 60 new listings on the market.  It appears that Sellers are more realistic today about at what price their homes should be listed to get it sold, not just for sale.  Showing activity has picked up on the weekends but it is still somewhat slow during the week.  Open house activity has picked up as well.

Parker—The threat of a possible government shutdown did not have as much impact as some anticipated.  The activity in the Douglas County market is picking up every week, and the listing inventory continues to go down.  This trend has caused several areas to hold their value relatively stable.  Despite these very positive trends, it is still unusually difficult to get transactions to the closing table!  Skilled agents that are able to educate and guide buyers abd sellers have become more & more important in today’s challenging real estate environment!

Devonshire—Many things are happening at the Devonshire Coldwell Banker office this week.  Our wonderfully located office, in the heart of Cherry Creek is getting a renovation & a new look. We are very excited about the look & increased functionally to help our broker and clients.  Showings on all ranges of property have had a healthy upswing of over 8% from the previous period indicating stronger consumer interest in all price ranges.  Additionally, new contracts and listings have increased which is also a strong indicator.  We’re all looking forward to these positive movements & bringing a higher standard of professionalism to our clients and the general public.

SW Metro—Our showings have increased each week and we are having great activity in our open houses.  Several agents this past week picked up buyers and are currently working with them to find a home.  Also, floor has been successful for several agents who are also working with buyers.  We had two agents this past weekend who had offers on three of their properties.  We’re still seeing a steady flow of buyers who are well priced properties.  We’re also seeing activity, not only on the $150,000 to $200,000 range but also the $350,000 to $450,000 range.  Agents are busy and the phones are ringing!

Denver West—The Denver West office placed 88 homes under contract during the month of March.  We are on target for an even more active market during April.  One of our multiple offer listings was on the market in the $300,000 price range and had three offers.  This generated a “bidding” event which ultimately sold the home for more than the list price.  Positive energy is felt throughout the office.  We are very busy listing & selling homes that are “priced right,” with staging in place.

Conifer—No new listings went on the market so far in April for the Conifer office.  Our inventory has declined slightly as three listings went under contract.  Our showing activity declined sharply with only 22 showings for the month to date.  Our selling activity remains steady since four buyers have been put under contract.

Loveland—The big news in Loveland is that Loveland is the front runner for the ACE campus.  This could mean thousands of mid to top range jobs coming to Loveland soon.  The Loveland community was very involved with showcasing the benefits that Loveland has to offer.  Local builders are showing their confidence in the local market.  They are digging foundations on spec homes and are offering some incredible deals.  Short sales and foreclosures continue to be prevalent in this market.  Buyers, both owner occupied and investors are seeing the value of these homes.

That’s it for now!  Make it a great week!

Chris

The paradox made me think that a lot of people – consumers and real estate reporters alike – may not realize that such monthly reports as the Case-Shiller index and even the very popular market reports are really lagging indicators of the housing market. They are in effect old news by the time they are released. These reports are based on closed sales the previous month that actually began two or three months before in many cases.

Take the most recent Case-Shiller report: This study came from closed home sales – not in March or even February – but January. Those same transactions began when consumers agreed to buy the home perhaps as early as the fall. These kinds of reports are a very old “snapshot” of the housing market by the time they get to the news media. This would be like someone opening up their sports section last October and instead of seeing the Giants in the World Series, found our local heroes 10 games out of first because the papers was still reporting the July standings.

So what’s a better way to take the current temperature of the market? New sales or pending sales are a much more accurate assessment of what’s happening now because they are a forward-looking indicator. These are sales that have just occurred, but haven’t gone through the 30 days or 60 days necessary to complete escrow. New pending sales offer the best barometer of what’s happening at the moment regarding buyer confidence in the housing market; the transactions that will be reported by Case-Shiller a month or two from now.

And what’s encouraging to me is that all across Colorado, pending sales in March are outpacing the same total last year.

This is not to say that every community and every neighborhood in Colorado is seeing a revival in new sales. There are still slow areas that are still challenged, depending on the price point. And even within some cities, certain parts of the market are doing well while others might be soft. And the overall market will continue to be challenged by shadow inventory of distressed properties coming on the market.

But my point is that if you read the lagging indicators like the Case-Shiller report you’d think the market is dropping off the cliff. Far from it. We are definitely seeing a tremendous improvement in many parts of Colorado, and we’re not alone.

According to the National Association of Realtors, the pending home sales index for properties nationwide, a forward-looking indicator, rose 2.1 percent to 90.8, based on contracts signed in February, from 88.9 in January. Lawrence Yun, NAR’s chief economist, said, “Pending home sales have trended up very nicely since bottoming out last June, even with periodic monthly declines. Contract activity is now 20 percent above the low point immediately following expiration of the home buyer tax credit.”

The outlook wasn’t even across all regions, however. The PHSI in the Northeast fell 10.9 percent to 65.5 in February. In the Midwest the index rose 4.0 percent in February to 81.1. Pending home sales in the South increased 2.7 percent to an index of 100.3. While in the West the index rose 7.0 percent to 105.6 and is now 0.6 percent higher than February 2010.

“We may not see notable gains in existing-home sales in the near term, but they’re expected to rise 5 to 10 percent this year with the economic recovery, job creation and excellent affordability conditions providing confidence to buyers who’ve been on the sidelines,” Yun said.

One other thought when it comes to housing numbers: It’s important to take the lower median or average sale prices in monthly reports this time of year with a grain of salt.

In many markets throughout Colorado, REOs and short sales can make up as much as 20% to 30% of the entry level sales.  While typical homeowners might take a break from the holidays and list (or re-list) their property in January or February, banks don’t take any breaks in November and December. These listings stay on right through the holidays. So a greater percentage of available listings that sell are “distressed” properties at lower price points, bringing the median and average sales prices down for several months in the New Year.

Below is a market-by-market report from our local offices:

Boulder— While the number of listings has dropped by 10% over the past two weeks in the marketplace the CB Boulder office experienced a 30% increase in listings over the same period.  For the month, CB Boulder will have listed in excess of 80 properties.  Sales have remained flat over the past two weeks.  Showings have decreased 12% however when asked, agents felt that their showings were increasing.

Colorado Springs— Our market hit a bump in the road with showings dropping about 30% from the past few weeks.  It is steady during the week but on weekends it’s very slow.  Listings are steady and it looks like a lot of sellers are getting their homes ready to put on the market (agent feedback from prelisting calls).  Sales have been steady throughout the month & with interest rates still at an all time low, it should continue to be a great time to buy and or sell.

Southeast Metro— As we look back at the month of March, we are feeling optimistic about the real estate direction for 2011.  Sellers are now getting into the market with homes that are staged to show nicely and priced, for the most part, to reflect accurate data and market trends.  Buyers are feeling better about their choices in the market place with this influx of “new” inventory.  Mortgage rates are still better than they have been historically and buyers seem to be ready to purchase now rather than taking a chance on an upsurge in rates.  With the upcoming increase in mortgage insurance premiums for FHA buyers, which should take effect mid-April, those that need and want FHA financing should identify their new homes & lock their rates as soon as possible.  The upper end of the market is moving with homes on the market for a shorter period of time.  Showings of these homes have increased & buyers for these homes seem to be feeling a little more confident in the current economic conditions.  We’re optimistic about a better spring season than we’ve seen in some time.  We’re also optimistic about a successful upcoming real estate season.

Denver Central— Well, it appeared that we were really starting to pick-up momentum, but the last two weeks have dropped off from the first two weeks of March and the last two weeks of February.  It seems that all activity has flattened out.

Evergreen— We’ve had seventeen new listings go on the market in March.  Listing inventory continues to increase as homes come on the market as the selling season gets into full swing.  Showing activity has rebounded following a decline in February due to severe cold & snowy weather and has spanned all price ranges and property types, totaling 295 showings and previews during the month.  Selling activity has also improved with four listings and twelve buyers being put under contract so far this month.  Properties that are priced competitively at the outset or are adjusted to the “sweet spot” will receive offers and in some cases, multiple offers while properties that are overpriced are shunned by the buyer pool.

Longmont— The Spring buying season has started… the showings on our listings are holding steady at a nice rate.  Homes being shown are in most price ranges.  Still not seeing a lot of activity in the $1,000,000 and up price ranges.  A number of agents are showing rural/acreage properties , need to put those horses somewhere.  Buyers, both investors and owner occupants are looking at and buying HUD homes.  There are some great values with bank owned properties too.

North Metro— March has turned out to be an extremely busy month at the North Metro office.  Our listing inventory is up as is the average sales price for our office.  The agents are set to close approximately 80 homes in March.  This is slightly down from last year at this time, but last year we had the Tax Credit, which of course we don’t have this year.  Open House activity has increased as has the number of calls coming into the office.  We’re looking forward to an even better April.  Spring is definitely in the air.

Southwest Metro—Our agents are very busy with buyers & sellers.  We have seen a steady increase in listings and buyer contracts. Open houses have been great!  Several agents have picked up great leads and have had terrific activity.  Floor calls have resulted in several listings as well as a couple of buyers.  We are seeing activity in listings in the price range of $300,000 to $450,000.  We are still seeing short sales in several areas and we feel that these will be around for awhile.  Overall, the agents are busy & working hard to get listings priced to sell in our market place.

Denver West— We’re seeing competition from buyers who are purchasing in the $190,000 to $250,000 price range.  It appears that there is pent-up energy with sellers.  They are tired of waiting for the market to fully rebound & are deciding to place their homes on the market at this time.  Most are very realistic about their sale price.  Oftentimes, if the house is priced aggressively, we are able to generate more than one offer, which ultimately bumps up the sale price.  The buyer in the number one position acts diligently because they know there is a back-up offer behind them waiting to move into first place.  Traffic at open houses has increased.  Buyers have more confidence in the economy, know the interest rates are low and believe the prices are good.  We see more motivation on their part.

Conifer— We had five new listings go on the market so far in March.  Inventory has stabilized as fewer homes are being withdrawn and both new and past sellers are beginning to put homes back on the market.  Showing activity continues to gain strength with 140 showings.  Selling activity is also increasing with five listings and two buyers being put under contract so far in March.

Loveland— We are waiting and waiting for the location decision of the Aerospace & Clear Energy Manufacturing & Innovation Center (ACT) to be announced.  Loveland is a very viable candidate for the location.  Loveland would see a huge benefit should ACT locate here.  The art community in Loveland is gearing up with fund raisers and great exhibits in our many galleries in town.  New construction is happening in Loveland and there are great products at entry level pricing.  The time to buy is now!

Have a great week!

In his letter, Buffett notes that, “a housing recovery will probably begin in a year or so. In any event, it is certain to occur at some point.” He said that “home ownership makes sense for most Americans, particularly at today’s lower prices and bargain interest rates,” adding, as an aside, that “the third best investment I ever made was the purchase of my home.” The first two, he says, were wedding rings.

Consequently, Buffett told shareowners, he has made several strategic investments in the housing sector in recent months. Among these are five corporate acquisitions in the building components field, a $50 million acquisition of a brick manufacturer, a new $55 million roofing plant for Johns Manville, and $200 million capital expansion of his Shaw Industries carpet company.

“Buffett doesn’t spend money unless he thinks he’s going to make money,” Jeff Matthews, hedge fund manager and author of Pilgrimage to Warren Buffett’s Omaha, said in a recent interview. Matthews said Buffett’s housing bullishness is “interesting because that didn’t happen last year and didn’t happen the year before that.”

The legendary chairman of Berkshire Hathaway isn’t the only one suggesting a turnaround in housing may be at hand. The Wall Street Journal ran an article recently headlined, “Why 2011 May be the End of the Housing Crash.” The Journal gives a number of reasons as to why we may have seen the bottom, including the fact that housing is the most affordable it has been in decades.

Nationally, the cost of a house is the equivalent of about 19 months of total pay for an average family, the lowest level in 35 years, Moody’s Analytics says. Prices usually average close to two years’ pay, although that varies nationally.  At the peak, midway through the last decade, a home in Los Angeles, the Journal said, cost the equivalent of 4.5 years’ pay. The average price has since fallen to just over two years’ income now. That’s well below its pre-bubble average of 2.6 years.

“Pricing is down so much in some markets that when you analyze renting versus owning it makes much more sense to own,” says Michael Larson, a real-estate analyst at Weiss Research in Jupiter, Fla.  Such analyses are “definitely bullish,” the Journal said. “Housing prices will probably bottom in 2011,” agreed Scott Simon, a managing director at money-management firm Pimco in Newport Beach. His views are important because Simon foresaw the housing crash, helping his firm dodge losses that plagued Wall Street.

The Journal also points out that investors are stepping up to buy real estate, which is usually another sign that the market has bottomed out or is near a bottom. In some instances, they’re paying entirely in cash. “That’s a far cry from the heady bubble days when borrowed money seemed the key to riches,” the paper reported.  “It’s a sign that these investors are betting on a rebound.”

What to make of all this? It gives me reason for optimism that the real estate market in general – and the Colorado market in particular – may see much brighter days in 2011. As the economy continues to mend, it’s reasonable to expect some of the greatest economic gains will be seen locally thanks to our diverse economic makeup. That bodes well for our local housing market.

Below is a market-by-market report from our local offices:

Boulder—While new listings are down for the two week period by 12%, the Boulder office saw an increase in listing inventory.  Active backups and pendings saw a very slight decrease over the two week period.  Closings saw the largest decrease, however the first two weeks of February close 66% of the transaction closed during the heavy closing period of the month ending two weeks previous period.  This indicates more closing volume in February 2011 when compared to the previous month.

Colorado Springs—Our market has been slow the past few weeks.  Showings have dropped 20% with very few showings on the weekend.  This is a surprise because our showings were strong throughout January.  Sales have also slowed down with most buyers not wanting to go under contract with a house that is listed as a short sale.  Listings have also decreased as most sellers are waiting until spring to put their homes on the market.

Denver Central—Our activity is still doing very well.  The number of contracts written has nearly doubled from the two weeks previous.  Listing inventory has picked up however, and has tripled from two weeks before.  The number of buyers is increasing but so is the inventory.

Evergreen—We had two new listings that went on the market so far in February.  Our listing inventory has started to increase as both new sellers as well as past sellers are beginning to put homes on the market.  Four listings went under contract and six buyers have been put under contract for the month to date.  Showing activity has been impacted by severe cold & snowy weather during the first two weeks of the month with only 70 showings for the month to date.  Activity has been in all price ranges, including two buyers under contract on properties in excess of $500,000 and on all property types; single family homes, condos & vacant land.

Longmont—Don’t you just wish you had a magic crystal ball to tell the future?  Now, more than ever the housing market is local, local, local.  We are seeing price increases in one subdivision and price decreases in another subdivision.  Short sales continue to make the market stats move dramatically in a short period of time.  Most short sales and bank owned properties are subject to multiple offers.  If being one in a number of competing offers and waiting for the “bank” to reply is not in your home buying strategy, look at the well priced & usually well maintained homes that are also on the market.  Great deals are out there.  Now is the time to put your home on the market & beat the Spring rush!

North Metro—We saw slightly decreased activity in the month of January but it is picking up in February.  Could be due to the frigid cold weather?  Our Agents continue to list around 30-80 homes per month with a slight decrease in the number that are in a short sale situation.  Activity at open houses is picking up as is the number of floor calls coming into our office.  Our average sales price is $261,000 at this time, however we are beginning to see an increase in the number of Luxury homes ($500,000+) beginning to sell.

Southeast Metro—Here we are nearing the end of February and things are very busy here at the SE Metro office.  Not only have showings increased, but open houses have had more visitors & sellers are realizing that it is time to get their homes onto the market before they have more competition with other homes.  With the little bump in interest rates that we saw last week, it has prompted some buyers to get out there & look at homes sooner rather than later.  Thus the surge in activity, we believe.  Now is the time for sellers to be doing all of the maintenance items & sprucing up of their homes in anticipation of a quick sale once they get their homes listed.  This spring promises to be a busy time for all of us & we are anticipating it to be better than last year.

Denver West—Denver West agents are still listing and selling many short sale properties.  The odds of closing has increased tremendously with the use of a short sale negotiating company.  Nice weather increased attendance at open houses.  Many buyers are taking every relevant step towards a successful purchase.

Conifer—We’ve had three new listings so far during the month of February.  Our inventory has stabilized as fewer homes are being withdrawn and both new and past sellers are beginning to put homes back on the market.  Showing activity continues to increase with 51 showings this month despite several periods of cold and snow.

Loveland—The winter deep freeze that we experienced did not help home showings or sales BUT the good news is that the usual Colorado winter weather has returned.  It is safe to go house hunting again!  We have buyers who are looking and looking and looking & are not finding what they want right now.  They are looking for well maintained homes priced competitively.  Now is the time to list your home.  Short sales and bank owned properties are still having an impact on our market in certain locations.  Investors are buying in the market…a good sign for all of us.

That’s it for now. Have a good week!

Chris

Steady improvement in the financial markets is putting the Great Recession even farther behind us. It means that retirement accounts for millions of Americans have erased much of the losses inflicted by the sharp downturns of 2008 and early 2009. Two years ago next month the Dow stood at 6,547 and the S&P at 676. Since then, they’ve nearly doubled in value. It’s an encouraging signal that the economic recovery is gaining traction, albeit slower than most of us would like.

So what about the real estate market? In general, the nation’s housing market remains fragile. While there has been improvements in many communities since the depths of the recession, including here in the Denver Metro area, the market overall continues to be challenged by high unemployment rates and the shadow inventory of additional homes that could fall into short sales or foreclosures.

While acknowledging all of the economic headwinds, Rick Newman, chief business correspondent for U.S. News and World Report, wrote this week that the stage could be set for a solid recovery in the housing market this year. “A buzzer won’t go off when it happens, but 2011 could be the year that the housing bust officially ends,” he said.

Nationwide, prices have fallen by about 30 percent since the peak in 2006, and Moody’s Analytics thinks they could fall another 5 percent or so in 2011. “But improvements in the overall economy will lift the housing market sooner or later, with many buyers who have been sitting on the sidelines finally deciding to take the plunge,” Newman writes. “In a few markets, that already appears to be happening.”

U.S. News says home buyers are tiptoeing back into the market, amid an increasing number of signs that the fifth year of the housing bust might be the last. “Economists are watching closely for an inflection point at which the housing market turns upward for good. But for buyers planning to live in a home for years, precise timing matters less because they also need to take into account the direction of interest rates and their own personal need for housing,” Newman said.

“With flippers and speculators largely out of business, most buyers simply want to know that the home they buy won’t plunge in value once they own it. In many U.S. cities, that now looks to be the case,” he adds.

U.S. News points to four reasons that home buyers may be feeling more confident that it’s safe to step off the sidelines:

• In some markets, homes are now undervalued. According to the Case-Shiller home-price index, overall prices nationwide have fallen 30.3 percent since peaking in 2006. Moody’s, for instance, says that homes are undervalued in many cities, based on the ratio of home prices to median income.
• Affordability is excellent. Falling prices, plus falling interest rates, have made homes more affordable than they’ve been in decades. The National Association of Realtors’ affordability index, which goes back to 1970, is at the highest level it’s ever been. The typical family today needs to spend just 13 percent of its monthly income to pay the mortgage on a median-priced home, compared with nearly 25 percent at the peak of the housing bubble.
• Economic factors that affect housing are improving. Most economists believe the recession is over for good, with the risk of a double-dip fading rapidly. Consumers are spending again, and the economy is growing. Big companies have lots of cash and are in a good position to hire once business picks up. A rally in the financial markets is helping many Americans recover some of the wealth they’ve lost through falling home values. Those trends all support increased higher demand for homes.
• The government will continue to support housing. There will likely be continued political debate over Fannie Mae and Freddie Mac, the troubled housing agencies now operating under government control. But despite some calls for a private system to finance housing, it’s likely the government will remain a key player in the mortgage market until at least 2013, after the next presidential election. And once policymakers figure out how to replace Fannie and Freddie, it will probably happen slowly, so as not to upset the housing recovery.

While it’s still too early to tell for sure where we are in the recovery, anecdotal reports from our field offices tell us that things are gradually moving in the right direction. Buyers are easing back into the housing market in many Colorado communities. As we approach the spring buying season it will be interesting to see how this translates into sales. Stay tuned!

Below is a market-by-market report from our local offices:

Boulder: Feedback from our agents in the office indicates an increased pace of business.  Many agents are working with at least one active buyer and have a scheduled or upcoming listing appointment.  While showings remained flat the total number of parties looking at houses has increased over the past two weeks.  Listings are up 5% over the previous two week period and agents report information gathering by potential listing clients is increasing.

Colorado Springs: Listings have been steady at best, with a lot of sellers waiting until Spring, showing no urgency to move at this time.  Showings have been increasing with the past week being the best showing week since last November.  Sales have slowed even with the showing activity as buyers are still hoping interest rates will go lower.

Denver Central: According to agents, activity is definitely picking up.  Our numbers have also picked up but need to remember we had two holidays in there, January 3rd and January 17th.  I anticipate that our numbers should be up a little the first two weeks of the month.

Devonshire: Here we are at the end of January & it looks like an interesting year is shaping up.  We have had a very nice jump in showings on our properties since mid-month & our sllers are feeling much more optimistic about the activity level in the community.  Interest rates have bumped up slightly but just enough to remind both sellers & buyers that the historic rates that we have been seeing may not be around forever.  We are seeing a very nice increase in buyer activity at open houses & with showings.  With increasing listing inventory, buyers are having many more homes to choose from.  Looks like this Spring will be better than last year & we are all feeling good about that.  The upper end is seeing an increase in sales yet but the activity will generate sales very soon.  We are optimistic about 2011.

Evergreen: We had a total of twelve new listings go on the market in January.  Listing inventory has started to increase as both new sellers as well as past sellers are beginning to put homes on the market.  Seven listings went under contract & six buyers have been put under contract in January.  Showing activity is improving as new buyers are coming into the market following the holidays with 199 showings during the month, nearly double the number of showings in December.

Larimer County: BRRRRRRRRRR! It may be cold outside, but the market continues to gain steam & momentum as we creep toward Spring.  Buyers seem to be emerging from hibernation & pent-up demand that we’ve been hearing about seems to be kicking in.  Combined with seasonally low sale inventory, we’ve seen some competing offers for homes in the popular price ranges (under $280,000).  Investors are also scouring the inventory for great deals as the demand for rentals increases.  Rental inventory is moving quickly which will likely push rental rates higher.  This appears to be a trend that will have some legs as financing for new purchase homes is still primarily dominated by the first time homebuyers with good credit & some down payment money saved up.  Move-up buyers with equity & good credit are also taking advantage of some tremendous deals in the $300,000 to $500,000 range.  Those without good credit or recent foreclosures on their record still need homes to live in & the rental market is where they’ll end up.  If you’re thinking about selling – now may be a good time to get your home on the market to take advantage of the low inventory & improving demand.

Longmont: it is nice to see the showings on our listings up by 16% week over week.  The price point of homes being shown is predominately in the mid-price-range for the Longmont market.  It is good to have this mid-level buyer activity.  The market is still very active with HUD homes, short sales and bank owned properties.  Investors have entered our markets in a large way.  They are looking for great deals and they are coming with cash.  A bright note is that appraisals seem to be more realistic on our current contracts.  The overall market is one of confidence.  Now is the time to buy.

Parker: The trend from last week continues!  Although the number of showings has decreased slightly, we are receiving more offers on our listings which seems to indicate that buyers are getting more serious!  On energy priced listings we still see multiple offers and the sellers taking advantage and sell for top dollar!  Now is the time to get your home on the market.

Southeast Metro: The first month of the new year started strong in the SE Metro office.  We averaged 600 showings every week in January and the average number of showings before selling dropped to 17 as compared to last year’s average of 24.  Our agents closed nearly 100 properties in January and put under contract 132 homes.  The luxury market is also experiencing an up tick in activity.  Open house activity is strong and we set a record for the most open house traffic over one weekend in January with 55 potential buyers visiting one home for sale!  It is an important time for sellers to evaluate the listing price of their homes and to adjust their list price accordingly.

Southwest Metro: We continue to see an increase in our showings.  Agents are very busy with buyers looking to buy.  Our mortgage rep had a great January & is continuing to stay busy.  The interesting fact is that sellers are wanting to list their properties but are looking for a full service company.  They realize that in this market they do need to have all the bells & whistles that we provide.  The $300,000 & below market is doing very well in our area and we have seen a slight slow down in the upper end listings.  Buyers are all over looking for starter homes as well as to move up.  There seems too be a tremendous amount of activity in the office & we are very happy to see it.  Open houses have been very good as well as floor calls.

Denver West: Our agents are very busy with buyers, showing property in all price ranges.  New listings at all price points have increased.  Although the market conditions indicate seller’s should be flexible when receiving an offer, not all of them are so.  Some are holding firm and the buyer is accepting their counter offer.

Conifer: We had one new listing for the month of January.  Inventory has stabilized as fewer homes are being withdrawn and both new and past sellers are beginning to put homes back on the market.  Five buyers were put under contract in January.  Showing activity has improved almost 50% over December with 86 showings this month compared to 58 for all of December.

Loveland: The price point on homes being shown is still predominately at the lower level.  First time buyers are seeing the benefit of owning vs renting.  With interest rates holding at a very attractive level more buyers are seeing this is the time to act.  Buyers are facing a long & sometimes not so friendly process when obtaining a loan.  Lots of documentation is needed and it may even have to be supplied more than once.  My advice, please don’t let the frustration with the process hold you from purchasing your dream home.

That’s it for now!  Have a great week!

Chris

The organization reported, “Existing home sales, which are completed transactions that include single-family townhomes, condominiums and co-ops, rose 12.3 percent to a seasonally adjusted annual rate of 5.28 million in December from an upwardly revised 4.7 million in November but remain 2.9 percent below the 5.44 million pace in December 2009.”

NAR Chief Economist Lawrence Yun had this to say about the upward trend, “December was a good finish to 2010, when sales fluctuated more than normal.  The pattern over the past six months is clearly showing a recovery,” he said.  “The December pace is near the volume we’re expecting for 2011, so the market is getting much closer to an adequate, sustainable level.  The recovery will likely continue as job growth gains momentum and rising rents encourage more renters into ownership while exceptional affordability conditions remain.”

Also revealed this week was Coldwell Banker Residential Brokerage’s must anticipated Denver Luxury Home Report which revealed that luxury home sales in the Denver Metro Area jumped sharply in December compared to a year ago as the luxury end of the market gained momentum heading into the new year.  A total of 51 homes sold for more than $1 million in the Denver Metro Area in December, up 54.5% percent from the 33 that changed hands in December 2009.  Sales were also up nearly 16 percent from November.

The median sale price of million-dollar homes edged higher in December from November, reaching 1.25 million, up from $1.23 million the previous month. However, the median was down 7.4 percent from last year’s level of $1.35 million.  The figures were derived from Multiple Listing Service data of all homes sold for more than $1 million last month in the Denver Metro Area.

My assessment of the market right now?  There definitely has been a lot more optimism in the market lately.  High-end buyers are starting to feel more confident about the economic recovery, both in the U.S. and here in the Denver area.  If you’ll recall in my December Reality Check message, I said that the upper-end market is probably going to be the first area of the market to recover because that market has softened since the middle of last year.  Early signs are showing that those buyers feel more confident that the economy is improving nationally as well as in the Denver Metro area and as the employment figures improve and thus, these are the buyers who are going to make a move.  As that happens, then the rest of the real estate industry will be pulled forward.  I believe these are the early signs that the luxury market is on the rebound and may be the first price niche to recover from the housing downturn of the last several years.

Now, let’s take a look at this week in real estate:

Colorado Springs:  Our number of listings has been slowly increasing the past few weeks with only about 15% being short sales (needing bank/owner approval for sale to be completed).  Showings have been up as agents get back to work after the holiday season and that has increased our sales to almost one and one half times what we’ve been doing.  With interest rates still at an all time low our market is looking very good for future business.

Denver Central: It seems as though our Agents have begun to receive more calls from their sphere over the last two weeks wanting to buy or sell.  There also seems that buyers are starting to get off the fence apparently responding to the rise in interest rates.

Devonshire: Welcome to 2011!  We are so excited to see 2010 fade into memories and to have a new year in front of us.  It appears that buyers feel the same, as our showings are up and buyers seem to feel this new energy.  Mortgage rates remain steady & the economic forecast is beginning to feel more optimistic.  Jobs are still a concern and once the public feel that jobs are opening up, we will see the real estate market take an upward swing.  Sellers, on the other hand are getting their homes ready to get on the market.  Why wait until everyone else gets their home listed & face all that competition!  They are better served to put their homes on the market as soon as possible & avoid the increased competition.  It’s great to feel new energy & optimism for the return of a stable real estate market.

Evergreen: One new listing went on the market so far in January.  Listing inventory has stabilized as both new sellers as well as past sellers are beginning to put homes on the market.  Three listings went under contract and three buyers have been put under contract so far this month.  Showing activity is improving as new buyers are coming into the market following the holidays with 103 showings so far this month compared to a total of 167 for all of last month.

Larimer County:  Happiest of New Years from Northern Colorado!!  December ended with quite a bang and it wasn’t just New Years fireworks that were popping!  Following the Christmas dip in activity, showings came roaring back & we had a flurry of closings prior to year-end putting us ahead of our previous December.  The 12-month statistics are showing some positive trends in terms of stabilizing sales trends.  When you filter out some of the noise from the bumps created by the home buyer tax incentives – the last quarter of 2010 really shows promise & January is proving to demonstrate more of the same.  Inventory levels have continued to drop & sales have remained stable.  The trend in sales look more like typical historic 4th quarter results which I believe demonstrates a flattening out of what has been downward movement over the last several years.  In spite of the chilly weather & snowy days, showings continue to increase each week as Buyers continue to take advantage of truly terrific interest rates that are still hovering just above 4.5% for a 30 year fixed arte mortgage!

Longmont: Wow, what IS happening to the real estate market?  Some days it seems like one step forward & two steps backward.  Our predictions are for a stable 2011.  Home prices will remain at or near the current range & mortgage interest rates will do the same.  Investors have money to spend & they are looking for “screaming” deals.  Dealing with the event of the shadow inventory coming on the market will keep local real estate market values fluctuating for the near future.  We continue to be cautiously optimistic.

Parker: The high activity of the first couple of weeks is now reflected in a decrease of inventory.  Showing activity and contracts written are still increasing!  If the weather cooperates we should be able to see this trend continue throughout the spring.  The office is very active and we were able to add four strong agents to our sales force.

Southwest Metro: Our showings have steadily increased since the 2nd of January.  Our agents are seeing an increase in 1st time buyers ready to actually find & write an offer on a home.  It seems that buyers are finally realizing that it is the time to buy before rates begin to move up.  Floor calls have been great with our agents receiving 4 leads this past week.  Open house activity has increased & our agents are feeling good about the way the new year is starting.  We have seen lots of activity on weekends in our office.  Agents are busy meeting with buyers & sellers.  Sellers seem to be ready to test the market & list their homes.  Buyers are wanting to buy.  We are also seeing more investors looking to purchase at this time.

Denver West: Activity continues to be strong in the Denver West office.  The mild weather has helped since it’s relatively easy to show homes without the usual snow storms.  Buyers are still looking “for the good deal.”  Sellers have become more realistic when considering pricing.  Showings are up for the month from the same month last year by nearly 150.

Conifer: One new listing so far for the month of January.  Inventory has stabilized as both new and past sellers are putting homes back on the market.  No listings have gone under contract in January although five buyers have been put under contract so far this month.  Showing activity has improved with 52 showings so far this month compared to 58 for all of December.

Loveland: Showing activity is creeping up in Loveland.  The market’s average sales price is also inching up.  We are seeing increased activity in our mid-range and upper range properties.  Financing is still a big concern to the overall transaction.  The largest percentage of deals fall due to the Buyer’s financing.  We’re watching the shadow inventory very closely here in Loveland.  It can impact a small neighborhood/subdivision swiftly.  Loveland is a delightful place to call home and it is beginning to get some national recognition as such.