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The Strength of the Market Depends Upon Price Range

The Strength of the Market Depends Upon Price Range

In a recent market update I outlined how we are seeing more price reductions, fewer sales and that the market seems to be shifting away from a strong sellers market.  However, there are still pockets in the Boulder County market where most of the houses are under contract.  As I looked further I found that these “pockets” around the county all seemed to be in the lower price range of their community.  The graphic below shows the absorption rate of the inventory throughout Boulder County in different price ranges.  Think of it this way, if we froze the market and accepted no new listings but sales happened at the rate they have been happening over the past three months, how long would it take to sell all of the listings.  According to NAR (National Association of Realtors) a balanced market is 6 months.  Anything less than that is a sellers market and more is a buyers market.  So what we have is a sellers market under $1 million, a balanced market between $1 million and $2 million and a buyer’s market above $2 million. Another interesting graph that helps to tell the story of the market is below and it shows the number of price reductions in the market on a weekly basis over the past three years.  2015 and 2016 were markets characterized by multiple offers and above asking price sales.  2017 started out in much the same way but by the end of spring we were seeing some softening.  One way to see this softening graphically is in the number of price...
Boulder County Real Estate Statistics for August 2017

Boulder County Real Estate Statistics for August 2017

The real estate statistics for Boulder County for the last few months have shown a shift in the market.  August continued this trend.  Sales during the month were 11% lower than last year and lower than any August since 2011.  We are seeing more price reductions, more negotiation room and it’s taking longer for homes to sell.  It seems that we are shifting away from a strong sellers market to a more balanced market.  View the presentation below to see multiple statistics pointing in the same direction.   Boulder County Real Estate Statistics August 2017 from Neil...
Neil Kearney is Again Recognized as a Five Star Real Estate Agent Award Winner

Neil Kearney is Again Recognized as a Five Star Real Estate Agent Award Winner

Neil Kearney has once again been recognized as one of the top real estate professionals in the Denver Metro Area.  The “Five Star Professional” award in the real estate category is awarded each year based upon independent research and interviews with actual clients from the past year. The Five Star Professional research team applies a vigorous research and evaluation process to identify service professionals who provide quality services to their clients. Professionals do not pay a fee to be considered or placed on the final list of Five Star award winners.  Along with outstanding survey results the real estate agents who are considered must obtain a high standard of production. This year the criteria was tightened, and under 750 real estate agents in the Denver Metro Market were recognized as a Five Star Professionals. There are currently over 20,000 licensed real estate agents in the Denver area.  Neil feels honored to be once again be designated award winner.  This is one of the most credible awards a real estate agent can receive because it is based upon direct feedback from recent clients.  Only the highest scoring agents are selected. Here is a description of the research methodology that is used.  Five Star Professional follows standard survey practices used by other professional research organizations. The research also includes a regulatory review to provide necessary checks and balances. Five Star Professional conducts research to help consumers with the important decision of selecting a service professional. The Five Star award is presented to wealth managers, real estate agents, mortgage professionals, home/auto insurance professionals and dentists in more than 45 markets in the...
A Summer Wrap-Up and What’s Next in the Boulder Real Estate Market

A Summer Wrap-Up and What’s Next in the Boulder Real Estate Market

Market Update The next sixty days will tell us much about the direction of the real estate market in Boulder County.  If you are reading this newsletter, you are aware that our market has been on a torrid pace since 2013.  Over the past five years the average home has appreciated in value by over 60%[1] .  A year ago, during the second quarter, our annual appreciation rate was ranked number 1 in the nation.  In short, our market has been sizzling hot.  As I have written about before, net migration to the area, a strong economy, a desirable lifestyle and a shortage of housing and buildable land have been the major drivers of this trend.  However, anyone who pays attention to markets over the long term knows that all markets are cyclical.  In this short update I will highlight some current trends in the market and see what that might mean for the future. Trend #1 – Slowing Sales Through the end of July, sales in Boulder County were down 3% from a year ago.  This alone isn’t such a big deal.  What is more interesting is looking at sales on a monthly basis.  Through March, cumulative sales in Boulder County were up by 6% over 2016.  The market was strong, multiple offer situations were common and houses were selling quickly.  Sales tailed off a bit in April and May but that was due more to lack of inventory than anything else.  Then right around Memorial Day the market noticeably slowed down.  Houses that one would expect to sell quickly lingered on the market. We also started to...
Boulder County Real Estate Statistics – July 2017

Boulder County Real Estate Statistics – July 2017

Right around Memorial Day we saw a shift in the market.  At that point properties started staying on the market longer, inventory started rising and sales started to drop.  It’s normal in Boulder County to have a slow down during the summer but this year it began earlier than usual.   This decrease in sales coupled with an increase in inventory has led to a slowing of price appreciation in the county.  Is this a shift in the market or just a seasonal slow down?  The next 30 to 60 days will tell a lot.  What happens during the fall will give us a good indication of what to expect next winter and spring. See the presentation above for a more in depth view of the market as well as graphs and...
Boulder Area Real Estate Update – The Kearney Report Q2-2017

Boulder Area Real Estate Update – The Kearney Report Q2-2017

I have just completed the latest edition of The Kearney Report for the second quarter 2017.  The goal of this report is to give you a quick understanding of the statistics and trends in the Boulder County real estate market. You can view the entire report below or you can download the PDF here.  The Kearney Report 2nd Quarter 2017 Real Estate Market Update During the second quarter of 2017 the Boulder area real estate market continued to be a strong sellers market, but towards the end of the quarter there was a change in the market.  In this summary I will discuss these trends as well as discuss what we might expect to see during the third and fourth quarter of the year. During the second quarter of 2017 there were 1,459 sales in Boulder County which reflects an 8.3% drop from the same quarter of the previous year. The median sales price during the quarter was $500,000 which is ironically 8.3% higher than it was a year ago.  Inventory this year has been been consistently higher than the past two years and this has given buyers more choices when looking.  This was especially true at the end of May when the levels of active inventory were above 2016 and 2015 levels, equal to 2014 levels and just below 2013 levels.  During the second quarter, 41% (50%) of the homes sold for a price above the list price, 22% (20%) were at the asking price and 36% (30%) were below.  When comparing this years numbers to last years, which are shown in parenthesis, it’s clear that the market...
2437 Lexington Street, Lafayette – $635,000 – SOLD!

2437 Lexington Street, Lafayette – $635,000 – SOLD!

2437 Lexington St. Lafayette, CO 80026 – $635,000 I’ve just listed a beautiful home in Lafayette.  It provides a rare opportunity to buy a premium lot backing on two sides to the Indian Peaks Golf Course & a quiet location at the end of a quiet cul-de-sac. It’s priced to sell now! It was built by McStain Builders but it has a custom plan with a 3-story addition that provides treehouse views from the master bedroom suite (great remodeled bath), a large formal dining room (maple cabinetry) & additional garden level space in the unfinished portion of the basement. The home is light and bright and has views of the green golf course everywhere.  A great value for a lucky buyer.            ...
Fireworks from 405 Hapgood

Fireworks from 405 Hapgood

The conventional place to watch the fireworks in Boulder is from Folsom Stadium.  But this year I watched them from the roof of my listing at 405 Hapgood.  405 Hapgood is located on the lower slopes of Flagstaff Mountain and has 180 degree views of Boulder.  The house is a great candidate for a remodel or a scrape and rebuild but what a place to host a fireworks party from your rooftop deck!  Here is a video that shows the finale from the 2017 Boulder Fireworks Show....
Senior Property Tax Exemption

Senior Property Tax Exemption

With property values increasing as steadily and as rapidly as they are in Boulder County, it should come at no surprise that property taxes are following suit. This became very clear this past May when assessment notices made their way around town informing Boulder County residents that the assessed value of their property had significantly increased by on average 26%. Although it is exciting to watch the value of your assets increase it does mean that property taxes will most likely increase for you as well. When discussing property taxes I believe it is helpful for anyone to have a basic understanding or concept of how property taxes are actually determined. When boiled down to the basics it is actually quite easy to understand. Three major components go into your property taxes: Rate of Assessment Assessed Value Mill Levy (Tax Rate) The Rate of Assessment for residential properties in Colorado serves as the base for property taxes as it determines what percentage of your homes actual value can or will be taxed.  This can be adjusted on the state level and just recently got lowered for the first time in 14 years from 7.96% to 7.2%.  The rate of assessment is multiplied by the assessed value to your taxable value. The Assessed Value is the value assigned to your home by the county assessor.  This assessment is adjusted every two years based upon comparable sales in your neighborhood.  The assessed value is what arrived in your mailbox in May.  Finally, the Mill Levy (also known as the Tax Rate) is the percentage of the Assessed Value that is actually...
Home Search Zillow Sued for Inaccurate Zestimate’s

Home Search Zillow Sued for Inaccurate Zestimate’s

This past May, Zillow, the online real estate search company was sued by a Chicago based home building company who claimed that Zillow’s online Automated Value Model (AVM) is deceiving home buyers with prices below the true value of properties leading to frustrated sellers. Furthermore the suit claims that Zillow’s “Zestimates” are in violation of the legal description of an appraisal, which under Illinois law must be administered by a licensed appraiser. Zillow defends themselves by stating that their Zestimates claim only to be approximations not true appraisals; to which the suit responds stating that whether or not they are technically appraisals homeowners are viewing them as such leading to confusion and irritation. It will be interesting to see over the coming months how this lawsuit plays out. It’s clear that Zillow’s Zestimate and other AVM’s which are becoming common across the internet are being used by consumers to determine the approximate value of their home.  But in my experience, many times this approximation isn’t close to the true market value. So just how accurate are Zestimates. In a Nationwide study conducted by Zillow it was found that their Zestimates fall within 5% of the sales price of homes 53.9% of the time, within 10% of the sales price 75.6% of the time and finally within 20% of the sales price 89.7% of the time. Back in 2007 when Zillow was just getting its footing I conducted my own research local to Boulder on the subject and found that on a whole Zillow’s algorithm was 99% accurate.  However, when I took a closer look I found that there was...