Economic April 29, 2021

The Future of Work?

This week we had the opportunity to hear a presentation by Ed McMahon who is the Senior Fellow for Sustainable Development at the Urban Land Institute.

He is a leading expert on the future of housing and development in the United States.

He sees that Colorado is positioned to massively benefit from the work from home shift taking place across the Country.

Ed cited that only 1 in 10 companies expect employees to come back to the office to work full time.  The believes the future of work is a hybrid model where most employees are mixing their work hours between the company office and their home office.

What does this mean for housing demand?

Smaller cities (like Denver), suburbs and high-amenity small towns will benefit.

He sees that those places with a high quality of life will benefit the most.

Bottom line, if people are untethered from their corporate office and can live anywhere, they will choose to live in places that are nice to live.

Colorado is certainly high on the list of high-amenity and high-quality places.

So, the new work from home dynamic is another reason to be bullish on the future of Colorado real estate.

Market Data April 28, 2021

Troutman Park 1st Qtr Real Estate Review

We’ve got a quarter of the year now to give us an idea of what Northern Colorado’s Real Estate Market has in store for 2021. Many were surprised to see how well Real Estate in our area weathered all the storms that last year threw at all of us. I think it’s fair to say that all of us are shocked to see what’s happened through the beginning of this year!

Let’s take a look back to see how Troutman Park’s Real Estate market has done through March 31, compared to the same time during other recent years. Here are the numbers:

2021 Q1 – 9 homes sold for $3,989,900. They ranged from $405,500 – $630,000 at an average of $433,322

2020 Q1 – 13 homes sold for $4,924,800. They ranged from $325,000-$420,000 at an average of $378,830

2019 Q1 – 12 homes sold for $4,439,400. They ranged from $325,000-$450,500 at an average of $369,950

2018 Q1 – 9 homes sold for $3,078,000. They ranged from $290,000-$394,000 at an average of $342,000

2017 Q1 – 7 homes sold for $2,377,200. They ranged from $257,500-$379,700 at an average of $339,600

2016 Q1 – 6 homes sold for $1,871,500. They ranged from $205,000-$400,000 at an average of $311,916

2015 Q1 – 15 homes sold for $4,004,175. They ranged from $218,325-$302,500 at an average of $266,945

We have a new All Time High in our neighborhood! The home at 819 Marble was listed for sale on at $585,000 on February 18, 2021 and quickly had 8 offers in it’s first few days on the market. It went under contract on Feb 22 and closed 22 days later on March 16th.

What I found interesting about the sale of 819 Marble at $630,000 was that it passed the previous neighborhood all time high sales price of $507,000 (731 Benthaven St) by $123,000! That’s an increase of 24.26%!

We’re seeing this in other areas throughout Fort Collins as well. The reason for such a significant jump is the inventory available for sale is down 71% here in Larimer County compared to last year at the same time. With all time low interest rates available many decided to put off their search for a new home and refinance the mortgage they were currently in to either save money or add on and improve their current residence.

That combined with the fact that home builders are seeing increases in costs and reduction in materials available (lumber, appliances, etc) means that there is a historic low in terms of what is available for buyers to choose from. At the same time there is a rise in demand because of the low interest rates and increasing desire for high quality suburban living.

The end result means there is a lot of opportunity for sellers to take advantage of this perfect storm if they want to cash in on all that equity that has developed.

If you have questions about anything or if you’re curious about what your home might be worth, just let me know. I grew up here in Fort Collins, I’ve worked in Real Estate since 2002, live right here in Troutman Park and I’m always happy to share.

Market Data April 14, 2021

The percentage of homes selling at or above list price

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What percent of properties are selling for list price or more!?!

Take a guess.  Of the properties that have sold so far in April, how many of them sold for at least list price?

Meaning, how many of them had a final sales price that was equal to or above the asking price?

The answer…

88% for properties in Larimer County and 86% for properties in Weld County.

We have been tracking this statistic for many years and this is a new record high.

Here’s something else that is interesting…

Not only do the number of properties selling for over asking price exceed the number selling under asking price, they also exceed those selling at list price.

There are roughly double the amount of properties selling for more than asking as compared to the number selling at asking price.

This is all a result of the low inventory, high demand market that we are experiencing.

We are using all of our researching, offer writing and negotiating skills right now to help our clients win in this highly competitive market.

Market Data February 18, 2021

Questions we get about market activity right now!

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Do you think more properties will come on the market this Spring?  Yes, the normal pattern in our market is for new listings to be 40% to 70% higher in April versus January.  The peak month for new listings is typically June.

Do you think buyer demand will grow even more as time goes on?  Yes, for two main reasons.  Buyer activity, just like listing activity, increases significantly in the Spring and Early Summer.  Plus, we expect the economy to open up even more as the COVID vaccine gets rolled out over the course of the year. Although in previous years prior to Covid-19 we’ve noticed that buyer activity really dies down in July/August. It will be interesting to see if there is enough pent up demand to break that trend this year.

Do you think interest rates will go up?  Yes, all of the trusted forecasters and economists expect rates to be slightly higher by the end of the year.  Our own Chief Economist sees rates at 3.07% by year-end.

Do you think prices will keep rising?  Yes, because of the simple economic forces of supply and demand.  Supply is at historic lows.  The number of properties for sale today is roughly 80% below the average.  Demand is being fueled not only by the low-interest rates, but also a rebounding local job market that is poised to rebound even more.  Plus, the new work-from-home dynamic positions the Front Range as a sought after place to live.

Market DataTroutman Park February 10, 2021

Troutman Park 2020 Real Estate Year in Review

All the data from 2020 is in and it’s time to look back and see how Troutman Park’s Real Estate Market has performed compared to other recent years.

Back in March last year many felt like property values would decline like many other investments did through all the Covid-19 adjustments. If you own a home in the Troutman Park area you’ll probably be happy to see that we’ve actually fared quite well though.

 

Here are the numbers compared to other recent years:

2020 – 70 homes sold for $28,164,381. They ranged from $331,000-$507,000 at an average of $402,348

2019 – 72 homes sold for $27,749,783. They ranged from $300,000-$505,000 at an average of $385,413

2018 – 51 homes sold for $18,681,050. They ranged from $286,500-$480,000 at an average of $366,295

2017 – 56 homes sold for $19,372,269. They ranged from $257,500-$443,000 at an average of $345,933

2016 – 55 homes sold for $17,891,500. They ranged from $205,000-$436,000 at an average of $325,300

Since 2016 the average price of Troutman Park’s Real Estate has increased by almost 24%

Right now Northern Colorado is seeing serious demand for housing while supply is at an all time low which is resulting in competing offers for many properties and accelerating our appreciation rate.

To give you an idea of where we’re at Fort Collins has 91 homes on the market between $350,000-$500,000 and 78 of those are under contract leaving only 13 available for buyers to choose from (as of 2/10/2021).

Right now in all of Fort Collins there is a total of 457 residential properties that are on the market and 330 of those (72%) are under contract. The average price of those homes that are under contract is $519,884.

With interest rates around 3% buyers are able to justify paying premiums for homes that are move in ready. That combined with all of people who have become frustrated with big city living conditions/restrictions over the last year who are looking to relocate to areas like Northern Colorado means there is tremendous opportunity for anyone in our area that is thinking about selling a home this year!

If you have questions about Real Estate I’m always happy to share what I know. I grew up here in Fort Collins, I’ve worked in Real Estate since 2002 and live right here in Troutman Park so feel free to reach out if there is any way I can be of assistance.

Market Data February 3, 2021

Employment recovery fuels NoCo Real Estate Market

Interest Rates

“How could the real estate market be so strong in the middle of a pandemic?”

That is a fair question and one we hear frequently from our clients.

There are several reasons for this but two stand out.

  • Interest rates
  • Jobs

Employment has bounced back much quicker than most people expected.  When COVID first showed up, the expectation was that many industries would be hit hard for a prolonged period of time.

The reality is that only a few industries were severely impacted by COVID and the rest were able to get back to a near-normal level of business relatively fast.

Additionally, what we find along the Front Range is that our ‘job bounce’ is even better than the national average.

 

Here are the numbers…

The COVID-peak unemployment rate for the Front Range looked like this:

  • Larimer County = 11.1%
  • Weld County = 10.1%
  • Metro Denver = 12.3%

Today it looks like this:

  • Larimer County = 5.2%
  • Weld County = 5.2%
  • Metro Denver = 6.4%

 

Nationally, unemployment peaked at 14.8% and now stands at 6.7%.

So, a main reason why values are soaring right now is because jobs have bounced back, and that bounce combined with near all time low interest rates has increased demand while supply remains at a record low!

Market Data January 31, 2021

Q4 2020 Colorado Real Estate Market Update

The following analysis of the Metro Denver & Northern Colorado real estate market is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact your Windermere agent.

 

REGIONAL ECONOMIC OVERVIEW

The job recovery that appeared to be firmly in place in the summer has started to wane. Though Colorado has recovered more than 209,000 of the jobs lost due to COVID-19, employment levels remain almost 210,000 below the level seen last February. Even with employment growth stalling, the unemployment rate stands at a relatively respectable 6.4%, down from a peak of 12.2%. Regionally, unemployment levels range from a low of 5.4% in Boulder to a high of 6.9% in Greeley. Rising COVID-19 infection rates continue to impact the job recovery, and I do not see much in the way of palpable improvement until a vaccine becomes freely available, likely in the second half of this year.

COLORADO HOME SALES

❱ In the final quarter of 2020, 12,207 homes sold. This represents an increase of 21.8% compared to the fourth quarter of 2019, but 19% lower than in the third quarter. I am not concerned, though, because seasonal influences tend to impact sales in the winter.

❱ Sales rose in all markets other than El Paso compared to the fourth quarter of 2019. I believe sales are only limited by the number of homes on the market.

❱ Inventory levels remain well below what I would like to see. The average number of homes on the market in the fourth quarter was down 55% from the same period in 2019.

❱ Pending sales were 34% lower compared to the third quarter. Again, seasonality and a lack of homes to buy impact this figure. Pending sales are still 13% higher than a year ago.

COLORADO HOME PRICES

❱ Home prices rose significantly in the fourth quarter, with the average price increasing 13.7% year-over-year to $532,492. Prices were up 1.8% compared to the third quarter of this year.

❱ Interest rates are unlikely to drop much further and this will lead price growth to slow as we move through 2021.

❱ Year-over-year, prices rose across all markets covered by this report, with significant appreciation in Clear Creek, Gilpin, Park, and El Paso counties. Every county but Arapahoe saw double-digit price gains.

❱ Affordability in many Colorado markets remains a concern as prices continue to rise at well-above-average rates. That said, I anticipate we will see price growth moderate in 2021.

DAYS ON MARKET

❱ The average number of days it took to sell a home in the markets contained in this report dropped 15 days compared to the final quarter of 2019.

❱ The amount of time it took to sell a home dropped in every county contained in this report compared to the fourth quarter of 2019.

❱ It took an average of 26 days to sell a home in the region, down 3 days compared to the third quarter of 2020.

❱ The Colorado housing market continues to demonstrate solid demand, and buyers are clearly competitive as suggested by the short length of time it is taking to sell a home.

CONCLUSIONS

This speedometer reflects the state of the region’s real estate market using housing inventory, price gains, home sales, interest rates, and larger economic factors.

Home sales and prices are significantly higher than a year ago, and demand for housing is very much in place. Naturally, this favors home sellers who are still in control of the market. I do expect to see some improvement in listing activity this year, which, in concert with modestly rising interest rates, will likely start to take some of the steam out of the market. However, any moderation in the market has yet to appear. Even given the possible headwinds mentioned above, I am moving the needle a little more in favor of sellers, as demand is likely to exceed supply for the time being.

 

ABOUT MATTHEW GARDNER

As Chief Economist for Windermere Real Estate, Matthew Gardner is responsible for analyzing and interpreting economic data and its impact on the real estate market on both a local and national level. Matthew has over 30 years of professional experience both in the U.S. and U.K.

In addition to his day-to-day responsibilities, Matthew sits on the Washington State Governors Council of Economic Advisors; chairs the Board of Trustees at the Washington Center for Real Estate Research at the University of Washington; and is an Advisory Board Member at the Runstad Center for Real Estate Studies at the University of Washington where he also lectures in real estate economics.

Market DataMortgage January 19, 2021

Economists Prediction on Interest Rates

Interest Rates

Where are interest rates headed?

This question was one of many which were addressed during our annual Market Forecast yesterday.

Our Chief Economist, Matthew Gardner, provided insight on rates, prices, inventory and many other fascinating topics.

Matthew’s prediction is for rates to creep up to 3.07% by the end of 2021.  They are currently at 2.79%.

The image below shows how his prediction compares with predictions of his economist colleagues.

Please let me know if you have questions or if you would like a recording of the full presentation.

EconomicMarket Data January 15, 2021

Economists Prediction on Interest Rates

Interest Rates

Where are interest rates headed?

This question was one of many which were addressed during our annual Market Forecast yesterday.

Our Chief Economist, Matthew Gardner, provided insight on rates, prices, inventory and many other fascinating topics.

Matthew’s prediction is for rates to creep up to 3.07% by the end of 2021.  They are currently at 2.79%.

The image below shows how his prediction compares with predictions of his economist colleagues.

Please let me know if you have questions or if you would like a recording of the full presentation.

Home Design December 7, 2020

Home Remodeling ROI’s

Remodel

Americans spend $400 billion per year remodeling their homes.

So, which remodeling investment gives the best return when it comes to resale value?

It should come as no surprise, especially leading up to Thanksgiving, that the best money to spend upgrading your home is in the kitchen.

It’s the place where most homeowners spend most of their waking hours.

According to the research from the National Association of Realtors, it’s where remodelers will see the biggest return on investment.

Here is the ranking of various projects in terms of the value it adds to the home:

  1. Complete kitchen remodel
  2. Kitchen upgrade
  3. HVAC replacement
  4. Owner’s suite renovation
  5. Bathroom renovation
  6. Finishing a basement
  7. Adding a bathroom

If you have questions about what your property is worth or what the best remodeling value for your home is feel free to reach out. I’m always happy to share what I’ve learned.