In June/2013 the Boulder Valley housing market was humming along. Construction was peaking with new homes and condominiums being built in most market areas. Dormant housing projects, the product of several years of buyer disinterest, had new life breathed into them. Mortgage interest rates were slightly under 4% for the traditional thirty year fixed-rate loan. Single family home sales were up 12% for Boulder County through May/2013 compared to through May/2012. Attached unit sales were up nearly 15% for the same time periods. Available inventory was scarce. Home values had increased. Bank foreclosures and short sales were few and far between. All the stars had aligned and it was a seller’s market.
Here we are twelve months later. Several of the elements that existed a year ago in the Boulder Valley real estate market are still prevalent today. Bank foreclosures and short sales are still difficult to find. Available inventory is still well below the peak years of 2005 to 2008. Home values continue to increase, but at a slower level than a year ago. New construction is still apparent, especially in the eastern portion of Boulder County, with new subdivisions being developed. Mortgage interest rates have trended up over the course of the past year with that traditional thirty year fixed-rate loan now residing at slightly over 4%. In essence, on the surface nothing has really changed.
But … there’s always a but … the Boulder Valley real estate market feels different today than it did a year ago. There’s not that chaotic anxiety, where multiple offers and properties consistently selling for over the list price existed. It was a scarcity driven market back then. The market is more patient now … sanity prevails. The market has shifted from a seller’s market to a more balanced market. That’s not to say there aren’t properties coming into the marketplace that will have great demand, but overall the market has settled comfortably into a more practical state.
In a seller’s market, homes sell quickly. In a buyer’s market, homes sell slowly. In a balanced market, homes sell in a reasonable amount of time. Through May/2013, the Absorption Rate for single family homes in Boulder County was 150 days. Through May/2014 that number stands at 168 days. Not a significant difference, but half a month longer on average these days. At the end of May/2013 there were 1,288 active single family home listings in Boulder County. At the end of May/2014 that number stood at 1,290. Talk about a balanced market.
All economic signs indicate the immediate future will be much like the recent past for the Boulder Valley housing market. New construction will continue at a moderate pace. Mortgage interest rates will fluctuate up and down incrementally. Well priced homes, in good condition, will sell quickly. Home values will remain positive. The Absorption Rate will continue to improve as increased market activity impacts available inventory. (The Absorption Rate for 2013 ended the year at 71 days.) The overall market will peak in late summer/early fall and then start its typical slide into the holidays.
If you’re considering selling, this is an excellent time to make that move. Buyer activity will stay strong over the course of the next two to three months, with many prospective buyers wanting to be situated in their new home before the start of the school year.