|
Current Boulder Area Real Estate Data
- Significantly, the number of sales in the Boulder area peaked in 2004, three years ahead of the 2007 peak nationally. While the housing market here has slowed, it has done so at a measured pace since 2004 with housing inventory following suit. Sales numbers in our market were down year-over-year in 2008 by 15%. But the saving grace has been falling inventory of homes since 2004, shadowing the decline in sales, down 12% last year. That puts us in the enviable position of having remarkably stable prices.
- In FHFA’s (Federal Housing Finance Authority, formally the Office of Federal Housing Enterprise Oversight or OFHEO) Top 20 Metropolitan Statistical Area and Divisions with the Highest Rates of House Price Appreciation, the Boulder MSA is ranked 17th in their Highest Rates of House Price Appreciation Index 2.99% in 2008. http://www.fhfa.gov/webfiles/1280/4q08hpi.pdf, page 28. That includes the dragging effect of houses priced over $1 million. On February 24, 2009 Standard & Poor’s and Fiserv released data showing that home prices in the greater Denver metro area were down just 4%. Those areas that took-off after 2001? Tampa -22%, Los Angeles -26.4%, Las Vegas -33% and Phoenix -34%. 3% appreciation here looks pretty great in comparison.
- Price ranges that don’t have a balanced supply of buyers have come down. Any property over $1 million faces a stiff headwind of a lack of reasonably priced jumbo loans (over the $417,000 conforming loan cap) more than it does a dearth of buyers. The credit markets have to loosen-up for these price ranges to begin to recover. The Showings per Listing data and Absorption Rates illustrate this sharply. The lower price levels however are ticking right along getting the lion’s share of the showings with absorption rates around 5-6 months, which by definition is a positive market. And we’re seeing an increasing frequency of competing offers in these price ranges. (!!!)
Boulder Area Real Estate Market Outlook
The national economic situation may be dark, but not the real estate market here. The picture emerging is a local real estate market demonstrating a robust stability, poised to grow even as the national economy struggles to recover. While the national economic situation is very serious and will take a great deal of time, attention and money to return to a balance, the local Boulder area housing market is showing core strength and stability. If not for the depth of the national downturn, this market, founded in solid local economic components, may have been well into its third counter cycle rally. Economic factors will change, but those in place now in this area were forged in an nine year cycle of no growth while other markets bubbled-up on speculation fueled by subprime and stated income loans. Some say those last nine years were our saving grace. At the worst, the current strength of this local housing market is acting as a buffer against the worst of the national state of affairs. The complaint we are hearing from our buyers is that there are not enough houses to see in their price ranges. There is pent-up demand in our housing market, poised to move when conditions nationally begin to turn.
Notes
Case/Shiller Index vs. OFHEO. You hear the media quote the Case/Shiller Index as a barometer of the housing economy. A careful analysis of Case/Shiller however reveals that its data is limited and selective. C/S derives its data only from county assessor records and only from 20 metro areas across the nation. It also is value-weighted giving greater influence to more expensive homes; a slice of the housing market that is not doing well. A more objective and comprehensive data source is FHFA, the Federal Housing Finance Authority, formally OFHEO, the Office of Federal Housing Enterprise Oversight. FHFA/OFHEO data is derived from conforming and conventional loan data and price trends for all properties in 366 metro areas representing every state of the nation. This report therefore relies on the FHFA/OFHEO data.
Data
- Latest OFHEO housing report:
http://www.fhfa.gov/webfiles/1280/4q09hpi.pdf
- Observing the economic cycles through time.
Go to http://www.ofheo.gov/hpi_city.aspx. This site will allow you to compare three different metro areas through time and observe their cycles. In the left hand column enter Boulder, CO. Compare against two other metro areas like San Diego-Carlsbad-San Marcos, CA, Fort Lauderdale, FL or Des Moines, IO.
- Colorado Population figures:
http://dola.colorado.gov/dlg/demog/population/components/components.pdf
- Boulder Economic Council:
http://www.boulderbusiness.org/
Francis Draper, Executive Director francis.draper@boulderchamber.com
- 2009 Colorado Economic Outlook:
http://leeds.colorado.edu/uploadedFiles/_Documents/Centers_of_Excellence/BRD/Boulder%20Economic%20Council.pdf
- University Colorado Chancellor Speech:
http://dirwww.colorado.edu/chancellor/speeches/boulderEconomicCouncil011708.html
|