Is the “Market Chill” for Real?
I have to admit, whenever I read an article that references the Colorado market as “cooling”, I wonder what they’re referring to or what data they are looking at. Colorado is a seasonal market so analyzing sales data month over month will lead to variable results and trends. The truth of the matter is that across all counties on the Front Range in Colorado, prices are up year-over-year.
Whereas each local neighborhood is different and should be evaluated on a hyperlocal level, the average appreciation on the Front Range over the past 12 months has been approximately 4-5%. In the past 24 months, it’s as much as 11-12%.
It is true that the average days a listing is on market is slightly up, and the number of sales compared to last year is down just a bit, but that is not a “down” or “chilly” market.
Let’s do some simple math. If you bought a home in May 2018 at $500,000 it is probably worth about $522,500 today. With a net appreciation of $22,500 in a year (simple 4.5% appreciation), it is not bad a bad investment and this equity growth is the sign of an “up” market vs. a “down” market
In most areas, we are probably past the double digit year-over-year appreciation we saw a few years ago. However, one thing that has always helped Colorado be a stable place to purchase and sell property is our stable appreciation. Double-digit appreciation is nice for homeowners but it is rarely sustainable, and too many years of high appreciation can lead to a market correction. The Colorado Front Range is settling back into a stable market with 3-6% appreciation and growth year-over-year. This stability and balance creates confidence in the market and allows us to maintain steady appreciation instead of market corrections.
Sellers still have rising home prices on their side, but the tempering in price growth is making homes more accessible for buyers, thereby creating a more balanced market.
The remaining months in 2019 look good for continued real estate stability and moderate appreciation. Solid job and wage growth, coupled with high consumer confidence, should continue to bolster strong housing market activity. Add low mortgage interest rates to that (see sidebar for 8z Mortgage contact info) and you have all the elements of a “strong” real estate market.
So before reading too much into national and even local publications about real estate trends and direction, it’s always a good idea to ask those in the business of selling real estate vs. those that want to sell articles. ?
I’m looking forward to the summer and fall months ahead and welcome the opportunity to help you with your real estate needs. This is my full-time career and I am committed to being your local real estate expert.
A Refreshing Look at the Question “What is my House Worth?”
Let’s take a look at some of the stats for our area to get a better idea of what is going on in the local housing market!
In El Paso County for May 2019, the average sales price* was:
- $325,000 for Single Family Homes (up by 3.2% from 1 year ago)
- $232,000 for Condos/Townhomes (up by 10.5% from 1 year ago)
I have access to detailed stats across Colorado and can help you find out the worth of your property any time. I can also help you determine what your home is worth even if it’s in a different area. As always, I am here for you. If it’s time for you to buy or sell, let’s talk.
*Median sales price based on a six-month moving average