Facebook
X
Pinterest
Copy Link
Northern Colorado Market Forecast Overview
Did you miss our Northern Colorado real estate market forecast or do you just want a quick refresher?
Windermere Colorado’s President, Eric Thompson, gives you a recap of what we discussed and what we predict will happen with the housing market in the upcoming years.
A few key points from Matthew Gardner, co-presenter at the forecast and Windermere Real Estate’s very own Chief Economist:
OVERVIEW
Annual employment growth in Colorado was measured at a respectable 2.2% in November and will likely finish the year having created around 55,000 new jobs. Within the metropolitan market areas included in this report, we are seeing employment growth at or above the state level and I anticipate that this will continue to be the case in 2017.
Unemployment rates continue to drop, and with rates now below three percent, all of Colorado’s metro areas are at full employment. Because of this robust level of growth—in concert with very low unemployment levels—I anticipate that we will see some fairly substantial income growth as companies look to recruit new talent and keep existing employees happy.
HOME SALE ACTIVITY
- There were 14,614 home sales during the fourth quarter of 2016—up by a marginal 0.7% from the same period in 2015.
- Jefferson County saw sales grow at the fastest rate over the past 12 months, with a 5.9% increase. Sales activity fell in three counties, but this was a function of short supply rather than slowing demand.
- Listing activity continues to remain well below historic averages, with the total number of homes for sale in the fourth quarter 12.8% below that seen a year ago.
- The key takeaway from this data is that 2017 is shaping up to be one which will still substantially favor home sellers. I do anticipate that we will see some improvement in listing activity, but it is almost a certainty that demand will exceed supply for another year.
HOME PRICES
- Demand continued to exceed supply in the final three months of 2016 and this caused home prices to continue to rise. In the fourth quarter, average prices rose by 9% when compared to the fourth quarter of 2015. The average sales price across the region is now $393,969.
- In many parts of the region, prices are well above historic highs and continue to trend upward. With double-digit price increases over the past year, the market remains very hot.
- Annual price growth was strongest in Larimer and Jefferson Counties, where prices rose by 11.8% and 10.9% respectively.
- While we will likely see some modest softening in home price growth in 2017, we can still expect a very strong market.
Interesting Takeaways
The Zillow Group just completed an extensive survey of home buyers and sellers. Here are some interesting takeaways from the research:
- Half of today’s home buyers are under the age of 36, and 47 percent are first-time buyers. Solo home buyers are in the minority;
most buyers are shopping with a spouse or partner (73 percent). - Eighty-three percent of buyers are shopping for a single-family house. Their top considerations are affordability and being in a safe neighborhood.
- Today’s sellers are most often members of Generation X (38 percent), and the majority (63 percent of all sellers) are listing a home for the first time.
- Most sellers are trading their homes for one they see as an upgrade, seeking a median of 100 more square feet and a home that costs an average of 11 percent more.
- Sellers’ top regret was that they didn’t take more time to prepare for a sale (30 percent). (By the way, Windermere’s Certified Listing is a proven 10-step process which prepares both the home and our clients for the sale. Let us know if you want to know more about it.)
Top 5
A new report from Veros Real Estate Solutions, which works in enterprise risk management and collateral valuation services, shows the strongest and weakest markets for the next 12 months ending in Sept. 1, 2017.
Their Top 5 Markets:
At the bottom of their list is… Atlantic City.
Hot and Not
Where are the hottest markets in Northern Colorado?
Hint – it starts with “W”
Turns out the communities with the largest increase in year over year sales are… (drum roll please)
Windsor and Wellington!
Windsor transactions are up 22% more than last year. Wellington has seen an 11% increase.
All other NoCo communities are flat or lower than last year.
For example, Boulder transactions are down 9% compared to 2015.
Certainly one of the reasons for the uptick in Wellington and Windsor is the amount of inventory available to choose from and specifically inventory in the lower price ranges.
So, while prices are up everywhere, only two places have seen more sales than last year.
Signs of Slowing
It’s not just temperatures cooling off as we transition from summer to fall, there are signs that the market is cooling as well.
The numbers are in and both Loveland and Fort Collins had their slowest August in several years.
Loveland had 127 single family home sales last month. This is 16% lower than August 2015 and the slowest August for Loveland since 2012.
Fort Collins had their slowest August since 2011 with 206 single family sales. This is 13% lower than last year.
This is good news for buyers who may have been reluctant to enter the multiple-offer frenzy that occurred this past spring. It looks like we are moving toward a more “normal” market.
