The House Price Index report just released by FHFA.gov shows that home values in Boulder County decreased by 2.76% for the 1 year period ending March 31, 2011. This shows some deterioration in the general market conditions in Boulder since the House Price Index which reported on the period ending December 31, 2010. Real estate in Boulder County has been very resilient throughout the general housing downturn but it seems that some sellers are recognizing that a good price is the only way to reach buyers. FHFA ranks home appreciation in 309 market areas and Boulder is currently ranked 173rd. Last quarter we were ranked 87th. During the first quarter of 2011 FHFA reported a decrease in home values of 3.42% in Boulder County.
During the past year all homes in the United States depreciated 5.5%. Like Boulder this represented a step in the wrong direction in terms of appreciation. Values in Colorado dropped 6% and was ranked ahead of 16 other states (list includes Washington DC). According to the report, values in Boulder County have increased just .39% over the past five years.
Here are some positive things I see in the market going forward:
- As I mentioned in a previous post affordability is way up. Salaries have risen, prices have dropped on an adjusted basis and the cost to borrow money is down. This encourages buyers to make the move and encourages sellers to be realistic on the selling end in order to reap rewards on the buying end.
- Real estate in cyclical – one of the key indicators of a turning market is the lack of rental vacancies. It was reported this week that Boulder has the lowest vacancies in the state, just 1.6%. This will drive rents up and provide stimulus for renters to buy.
- We do not have an abundance of short sale or foreclosure inventory to work through. Right now in all of Boulder County just 6.7% of homes currently on the market are listed as distressed sales. This is very healthy and much better than the national average. In the City of Boulder this drops to 1.9% or just 21 homes out of 1,111 on the market.
- The market is still flowing. Currently 16.5% of listed properties on the market in Boulder County are under contract.
The most important thing to know is that transactions are happening every day. There are buyers looking at homes and all it takes is a seller who recognizes the market and can react to it by presenting their home as a good deal. I can help.