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Caught Up
We’ve been waiting for June to catch up. It finally happened (almost).
Back in April, real estate activity was significantly limited and the showing of property was restricted which caused the number of closed properties in May and early June to be much lower than last year.
Bottom line, fewer properties going under contract in April caused fewer closings 30 to 45 days later.
Closed properties in May were down compared to 2019 by 44% in Northern Colorado and 43% in Metro Denver.
Then activity jumped significantly in May. The number of properties going under contract was way up compared to last year.
We’ve been wondering when we would see this sales activity reflected in the number of closed properties.
Well, it finally happened (almost).
The number of closings so far in June compared to the same time period through June of 2019 is only down 1.8% in Northern Colorado and 1.6% in Metro Denver.
In both markets, there are only a handful of closings separating activity in June 2020 versus June 2019.
By the end of the month, when all the transactions are tallied up, we expect that June of this year will out pace June of last year in terms of number of transactions.
This is significant not only because of COVID-19, but also because of the reduced inventory compared to last year. Quite simply, there are fewer homes to buy.
All of this speaks to the health and resiliency of the Front Range market.
Matthew Gardner’s 2020 Real Estate Forecast
It’s that time of year when Windermere’s Chief Economist Matthew Gardner dusts off his crystal ball and peers into the future to give us his predictions for the 2020 economy and housing market.
All Time High
Home Builder’s confidence in Baby Boomer buyers is at an all time high.
The National Association of Home Builders (NAHB) surveys their members each quarter to discover what they expect of future sales.
The builders base a large part of their answer on how many people are visiting their sales centers and model homes versus the same time last year.
The results in their most recent survey show that builders have never been more confident about buyers who are 55 and older.
The confidence index for this age group is actually double of what it was in 2012. The NAHB sites low interest rates and strong job growth as the reasons for the high confidence.
Our Favorite Real Estate Podcasts
Podcasts are a growing medium as listeners search for new sources of entertainment and information. In 2018 there were about 550,000 podcasts, in 2019 there are more than 750,000. Listeners are growing too, an estimated 20 million more people in the U.S. are listening to podcasts this year as compared to2018.
This growth in audio entertainment inspired us to pull together a few of our favorite real estate podcasts. Whether you’re interested in investing in real estate, looking to make a move to a new home, or just want to know what’s happening in the market, here are our recommendations:
For Investors:
The Millennial Real Estate Investor
Find your niches in Real Estate with Dan Mackin and Ben Welch, who host experts with stories about their investing successes and challenges. Learn from the experienced guests on this show the many ways to get into investing and succeed at it.
Listen to Millennial Real Estate Investor wherever you get your podcasts (Icon linked):
Cash Flow Connection
If you’re drawn to the commercial side of real estate, Cash Flow Connections with host, Hunter Thompson, is an informative podcast that interviews leading investors, sponsors and managers. Learn about all the aspects of commercial real estate from all viewpoints to find the right fit for you.
Windermere’s Chief Economist, Matthew Gardner, was just interviewed about the state of the real estate market, and what to expect in the next recession (hint: it won’t be driven by housing). You can listen to that episode here.
Listen to Cash Flow Connection wherever you get your podcasts:
For Those About to Move
Windermere Home and Wealth
Host Brian Bushlach interviews business owners, local guides, and Windermere agents in each episode about different areas throughout the Western U.S. and what they have to offer to those who live or visit there. Learn about what’s attracting newcomers to the area, and what the local real estate market looks like. This podcast is sure to stir your wanderlust.
Listen to Windermere Home and Wealth wherever you get your podcasts:
Finding Home with 106.1 KISS FM
Join first-time home buyers, and radio personalities, Anthony and Carla Marie from 106.1 KISS FM, as they walk through the home buying journey with their Windermere agents. This podcast is both entertaining and informative as they ask the questions you’ve always wanted answers to. With their knowledgeable real estate agents by their sides, they’re taking you along as they get approved, look for houses, and even put an offer on a home.
Listen to Finding Home on iHeartRadio:
Stay Informed
Housing Developments
Hosted by National Association of Home Builders CEO Jerry Howard and Chief Lobbyist Jim Tobin, this podcast covers updates in the housing market and building industry across the nation. Learn from experts in the field about recent laws and the news of the industry.
Listen to Housing Developments wherever you get your podcasts:
Real Estate News with Kathy Fettke
This podcast is aimed at real estate investors who want to stay curren on the latest real estate news. Presented in bite sized episodes, listeners can learn about laws, regulations, and economic events that affect real estate and their local market.
Listen wherever you get your podcasts:
Net Worth
It’s no surprise that for just about every homeowner, their real estate represents the largest portion of their net worth.
Check out these numbers from the Federal Reserve’s Survey of Consumer Finances:
- Median Net Worth in the U.S. = $97,300
- Median Net Worth of a Renter = $5,200
- Median Net Worth of a Homeowner = $231,400
If you want to see even more insights about the Colorado market so that you can make really good decisions about your real estate, you are welcome to watch this complimentary webinar, just click HERE.
Case-Shiller
The Case-Shiller Home Price Index is a well-known report in the real estate industry and a valuable way to gauge what is happening in various markets across the Nation.
The report tracks home price appreciation in the 20 largest markets in the country.
Their most recent report shows that, Nation-wide, home prices are up 2.1% year-over-year.
Last year prices were rising at 6.3%. So, prices are still going up but not as fast as they were.
The city with the highest appreciation over the last 12 months is Phoenix with 5.8% growth followed closely by Las Vegas at 5.5%.
Denver came in at 3.4% which makes it tied for 8th place out of the 20 cities.
A Closing Window
For home sellers who would like to move to a new home this year, there is a window of time that is closing as we head into the Fall months.
Most people know that the Spring and Summer are the most active months for real estate and that activity trails off into the Fall and Winter.
Here are the specific numbers behind this…
The number of homes sold along the Front Range in November tends to be between 15% and 29% lower than September.
That means the best window of time for current sellers to obtain a contract from a buyer and close by the end of the year will occur over the next 45 days.
For sellers who have homes on the market today, it is time to ensure that:
- The home is priced right versus the competition
- All of the marketing elements are in place
- It is easy for a buyer to make an offer on the home
Down Again
Mortgage rates dropped again for the fourth week in a row.
The average 30-year rate is now 4.06% which is the lowest it has been all year.
Rates today are actually the lowest they have been since early 2018.
The main factor driving rates down is the trade war with China.
Investors are shifting money from stocks into bonds which causes the yield on the 10-year Treasury to drop.
Mortgage rates are closely aligned with the 10-year Treasury.
At the beginning of the year, most experts believed that 2019 would have a trend of increasing mortgage rates eventually reaching 5.5%.
Instead, the opposite has happened which is good news for real estate.
Get Real
We’ve seen some headlines recently that suggest home prices along the Front Range have peaked and are starting to decline.
When we dig in and do the research, this is what we find…
Home prices are still going up, just not as fast as they have been.
We’ve known that the double-digit appreciation that we’ve seen for the last several years could not be sustained and we expected the pace of appreciation to slow down.
So far in 2019, this is the case. Prices still going up, just not as fast.
It’s like running up stairs. Eventually you will get tired and you will need to start walking (but you’re still going up).
Headlines that suggest that prices have peaked and are falling create unrealistic expectations for buyers and give sellers a skewed perspective on the market.
Here are the numbers…
Average Price:
- Up 1.53% in Metro Denver
- Up 6.1% in Larimer County
- Up 5.1% in Weld County
Months of Inventory:
- 5 Months in Metro Denver
- 5 Months in Larimer County
- 4 Months in Weld County
- (Remember that 4-6 months of inventory represents a balanced market)
There has been an increase in Days on Market which means that homes are taking longer to sell. But the increase is measured in days, not months.
Here are those numbers…
Days on Market:
- Up 4 Days in Metro Denver
- Up 11 Days in Larimer County
- Up 3 Days in Weld County
So, be mindful of headlines that can be sensationalized and might suggest that the market is falling.
Bottom line, the market is going up, just not as fast as it was.
Make the Most of the Home You Have
If you have been in your home for a while you may be restless for change. The great part about having a home of your own is you can make improvements and give your home a chance to evolve over time. You just need to help your home live up to its potential! Here is a top ten list of improvements that will help you make the most of your home.
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- Find your home’s purpose. Each home is as unique as its owners, so in order to fully utilize your home, consider how you view your home’s purpose. Some people like to entertain, others find it a calm space in the frenzy of daily life; some nurture their families and others nurture their creativity. Your home’s purpose can be any combination of these and more, but it helps to consider the function of your space in order to ultimately find its purpose.
- Assemble a list. A list always helps me figure out where to start or prioritize what is the most important project. Think about what you want to change in your home, inspirations, and preferences.
- Make an “inspiration board”. An “inspiration board” is a great way to visualize your home’s decor. You can create a board online with a tool like Pinterest to organize ideas you love or you can do it the old fashioned way with a board, magazine cutouts, color swatches, and fabric samples. Doing this will allow you to see all the elements you like in one place so that you can then tie it all together into a room you love.
- Create a collection. If you have items that you like to collect, think about how to transform that collection into something you can display. If you don’t already have a collection of loved objects think about what this collection would be for you. You can center a room design around your travel souvenirs, old camera collection, figurines, unique plates, or familial objects. Adding to this collection over time can be a great way to keep your spaces new while maintaining a personal feel to your decor.
- Choose a new palate. Shake up your sensibilities and think of a color that will compliment your room while making a statement. It’s easy to fall into the white/beige standby to keep our rooms neutral, but sometimes a color that provides a contrast to your décor will make the room pop.
- Repurpose an old piece of furniture. Instead of replacing your furniture give it a facelift. You can have a sofa or chairs reupholstered or make use of a slip cover. Also, Painting and staining can add new life to your wood pieces.
- Rearrange. Moving furniture around is another easy way to reinvent your space. Try placing your sofa on an angle to open up your entertaining room or move your lamps to improve lighting. You can also think about moving a piece of furniture into a room to give it new life, like using a unique dresser for a credenza or a chair as a side table.
- Make a room of your own. Find some space in your home that is uniquely yours, whether this is the corner of the guest room or an office of your own. It can be very rewarding to have a space that you can organize to fit your personal needs without the worries of others intruding
- Find an inspirational object. Have you ever fallen in love with an object that inspired you to want to completely redo a room to accommodate it? Designing a room around an inspiring object can be a great way to create a space that truly embodies your design sensibility.
- Find design motivation. Home design evolves over time and can be sustained by finding items that inspire you. Read magazines and books that inspire your interests in architecture, design, art, etc. Or find stores and flea markets that sell pieces that influence your aesthetic. Or bring a camera with you when you’re doing your favorite activities and bring back memories or inspirations. Most of all have fun!
What inspires your home design?
