The Kearney Report
Boulder County Real Estate 2011
NeilKearney.com
The Kearney Report Cautious Optimism Our view of the real estate market in Boulder County is multi-faceted. On one hand, sales ended up down 2.6% for 2011. The lowest total in over a decade. On the other hand, the real estate market, the economy in general and general sentiment seem to be heading in the right direction. All real estate is local and we are lucky to be living and working in an area where people want to be. High tech is still thriving in Boulder and the Highway 36 corridor continues to thrive with new national lease signings. As we continue to track the market we are reminded that real estate is not all about the numbers. Real estate is about emotion and security. The economy in general and the housing market in particular have deeply affected the way people view the world and we recognize that it will take some time to recover. We expect that the Boulder area will be on the leading edge of the housing recovery. Here are the reasons why: • The local economy has remained stable and we are being boosted by our vital high tech community. • Warren Buffet said that “You only find out who is swimming naked when the tide goes out”. Fortunately, the Boulder County real estate market was mostly covered. We don’t have a big surplus of foreclosures waiting to hit the market. Short sales are only a small part of the market. • Rental homes are hard to come by and the prices are rising! This will bring back buyers to the low end. • Housing affordability is way up! The combination of low interest rates and lower home values make this an incredible time to buy a home. Real estate comes down to basic economics; supply and demand. Over the last three years as our sales declined, we were lucky to have our inventory decline as well. If there are too many sellers out there that absolutely have to sell, prices fall. As we move toward recovery the number of listings is still low. Buyers are finding it hard to find the right home and there are more multiple offer situations. The market is not yet recovered but we are heading in that direction. Confidence in the market is key and if you are looking at the local real estate market your optimism should be rising.
NeilKearney.com
The Kearney Report Boulder County The total number of sales in Boulder County decreased by 2.6% during 2011. The past three years sales have been stable. Unfortunately, the level of stability during this housing market is 35% down from the peak. Median prices in Boulder County have been in a holding pattern over the past few years. During 2011, median prices in Boulder County were down 5.4% on average. FHFA.gov reported that according to their methodology, prices in Boulder County dropped just .75% for the year. This ranks Boulder County as the 57th (out of 306) best market in the nation for home appreciation.
NeilKearney.com
The Kearney Report Boulder County
The Federal Housing Finance Agency (FHFA) tracks home values in 306 metropolitan areas across the United States. Over the year ending December 31, 2011 the average appreciation in Boulder County was -.75%. The top graph shows Boulder County’s appreciation on a quarterly basis compared to the United States average. The lower graph compares Boulder’s most appreciation over the past 4 years to other select cities across the nation. The main takeaway is that, comparatively we are doing very well.
NeilKearney.com
The Kearney Report Boulder County The charts on this page offer an interesting view of the real estate market in Boulder County. What stands out here is the difference in median price between the City of Boulder and the rest of the county. There are many reasons that Boulder’s median prices are so much higher than the other communities in the area. Here are the top few: There is always a demand to live in Boulder by more people than can afford to live in town. There is a greenbelt of open space that surrounds the city that restricts new building (and adds to the quality of life). Lastly, many of the homes in Boulder have been improved in recent years so that the homes are different and more valuable than they were a decade ago. This effect is not so dramatic for attached dwellings, as seen on the bottom chart.
NeilKearney.com
The Kearney Report Boulder County
0 - $250,000 $250,000 - $500,000 $500,000 - $750,000 $750,000 - $1 Million $1 million - $1.25 million $1.25 million - $1.5 million > $1.5 million
2009 1703 1614 431 132 45 21 49
2010 1571 1684 515 137 61 28 45
2011 1569 1610 477 144 54 34 53
The top chart shows the sales pattern for Boulder County. Typically, sales peak from April through June and the rest of the year forms a smooth bell curve. The table shows the number of sales by price range. The number of sales in Boulder County were down2.6% during 2011. Sales under $1 million were down 2.7% but sales over $1 million were up 5% for the year. NeilKearney.com
The Kearney Report Boulder County Even though sales have been dropping, our market has not been overrun with listings. Our inventory has fallen as well. This has kept our prices relatively stable. I expect many homes to come on the market this spring. I sense pent up demand. The bottom graph shows absorption rate. Absorption rate relates the sales rate (how many properties sell per month) to the number of homes on the market. The graph shows the number of months it would take to sell all of the current listings. The lower the number the more activity in the market.
NeilKearney.com
The Kearney Report Five Reasons To Be Optimistic About Real Estate in 2012 1 2 3 4 5 6 7
Word is getting out through the media on why Colorado is a great place to buy real estate right now. People want to live here!! We have not had a real estate bust. Low foreclosure rate. We don’t need to wade through tons of short sales and REO sales in order to start moving forward. Strong economy with a young motivated work force who want to stay in Colorado. Low inventory – new building started slowing in 2003 not in 2007 or 2008. There is not a stockpile of homes to sell. If you have been putting off a move because you haven’t felt that it was the “right” time. It may be time to reevaluate your situation. If you are concerned because you have a house to sell check out the article on this subject at www.NeilKearney.com/advice-for-buyers/.
My Business Principles The foundation of my business is serving my clients. To me, being client focused means doing the things which build a long term relationship based upon respect, honesty and trust. By providing sound advice based upon broad experience and deep expertise, I’m able to provide a solid framework from which my clients feel empowered to make smart decisions. I have a long term focus. I know that if I consistently give great service, filled with integrity, I will attract abundance in all aspects of life. I believe this is best demonstrated by the small things done on a daily basis. I like to think of it as The Golden Rule +. I do what someone would expect plus a bit more. My approach can be described with the following words: friendly, high energy, no pressure, prompt, prepared and continual improvement. I like to win and succeed, but I think how I win is more important than winning itself. I have been chosen by my peers to chair the Ethics Committee and I strive to uphold the high honor of that duty. I am a second generation REALTOR® and Boulder native. I hope you will consider me first when you are considering buying or selling a home. I look forward to serving you!
NeilKearney.com