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RSS FeedDenver Real Estate Ideal for Buyers in March 2008 |
Categorized in: Denver Market Info
In spite of national real estate market "doom and gloom" reports, Denver buyers have a golden opportunity to buy at (or near) the bottom. In February the market showed more activity than it has in recent months. Properties under contract, both detached and attached single family homes, increased over January by 12.66%, and by 4% over February 2007. The number sold decreased slightly, but that number reflects properties under contract in January. Prices for all single family homes showed a slight decrease (-.47%) from January, and a greater decrease (-3.74%) from February 2007.
Median prices increased 2% from February for detached single family homes, but decreased by 1.9% for attached single family homes. The median price for detached homes was $221,486 in February, up from $216,950 in January, but down 5.75% from February 2007. For attached homes the price in decreased from February 2007 by 7.73%. The high number of foreclosures is keeping prices low, giving buyers the advantage.
Homes are still selling for much less than the original price, but by the time sellers finally sell, on average 114 days after first listed, the sale price was 96-97% of list price. Seller concessions, such as down payment and/or closing cost assistance, is still common.
Interest rates are still low (conventional loans were at 6.375% for well-qualified buyers as of March 7, 2008, from our preferred lender, RateOne, The Mortgage People). Housing supply is as high as it's been in awhile at 25,037. Homes are more affordable. Denver's economy is steady and jobs are expected to increase this year. The unemployment rate in December was 4.5%, a half-percent lower than the national rate of 5%. 22,000 new jobs are expected in Colorado in 2008, and foreclosures are expected to drop by about 9% according to Patty Silverstein, Chief Economist for the Metro Denver Development Corporation.
New home builders, faced with a sizeable inventory of unsold homes in early 2007, have pared the excess to virtually nothing. In the 4th quarter of 2007 starts of single family new homes and condos dropped to 1,611, the "lowest quarterly starts in the seven years that Metrostudy has gathered information for the metro area" according to the Rocky Mountain News (“Metro new-home sales, starts "worst in 20 years", February 7, 2008).
The Denver market is not in the same situation as many cities. We're still riding out the effects of the mortgage crisis which led to so many foreclosures, but values haven't dropped nearly as much as the rest of the country. Values dropped about 2% in 2007 and are expected to drop another 3% overall in 2008. Contrast that with Orange County, California (suburban Los Angeles) which dropped 10.2% or Boston a 13.3% drop.
Many parts of the country have suffered a double whammy with the real estate bubble bursting together with the number of foreclosures rising which put a downward push on prices. Denver's bubble burst in 2001, but values remained steady until 2007 when they began to drop. 2006 values increased an average of 2.7%, while values at the end of 2007 had dropped by 2%, a difference of 4.7%.
Denver's cost of living makes it an easy choice over higher cost areas like both coasts. According to CNNMoney.com it costs 57% less to live in Denver than in San Jose; 53% less than in San Diego; 61% less than in San Francisco; and 20% less than Seattle. If you live in the east, it will cost 51% less than in Washington, D.C.; 36% less than in Boston; 72% less than in New York; 26% less than in Philadelphia.
For buyers coming from the south and the midwest, Denver could cost more. It costs 14% more in Denver than in Atlanta; 49% more than in Houston; 41% more than in Dallas; 29% more than in Dayton, Ohio; 22% more than in Rochester, MN, and 23% more than in Boise. But living in Denver still costs 17% less than in Chicago, 16% percent less than in Portland, and a whopping 56% less than in Los Angeles..
You'll need to do your due diligence to compare cost of living between your city and Denver at websites like http://www.bestplaces.net, http://www.bankrate.com/brm/movecalc.asp, or http://cgi.money.cnn.com/tools/costofliving/costofliving.html.
Having an Exclusive Buyers Agent to find the best buys will shore up your buying ability by representing your best interests - finding the best home at the lowest possible price, and saving you time and hassles. See client references at http://www.buyers-advantage.net/references.html Phone numbers available upon request. Call Judith Clausen now at 303-587-3509 to help you find your new home in Denver.
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