The Boulder/Denver Metro area’s real estate market is typically robust in the spring and summer, and with the lifting of restrictions our late spring/early summer market is certainly living up to that reputation. As businesses reopen our housing market is finally starting to pick up. According to data from IRES, LLC, the Northern Colorado area MLS, new listings in Boulder and Broomfield Counties were up a whopping 80% from April, and down only 9.5% compared to May 2019. Considering the restrictions imposed on listing and showing activity due to the pandemic, this is far less of a monthly downturn that the 50% or more originally predicted for national averages.
This 80% increase in new listings and a 90% increase in properties under contract is quite uncommon and probably due to people who waited to put their home on the market or to pull the trigger on a purchase.
Although there was a slight hiccup in the activity over the last 7 days and we don’t have a crystal ball, the overall trend indicates the real estate market will continue to maintain at pre-COVID levels. Sold properties are still trying to catch up and are a clear indicator of what happened 30-45 days prior and were down 25% from 2019. New listings for the past week tracked with the same week in 2018 but were down almost 14% from 2019. Properties under contract show strong buyer activity.
Over 50% of the new listing inventory in the last week is within reach of first-time home buyers priced up to $600k while 14.6% is priced over $1M. The majority of the area’s listings continue to come from Boulder and Longmont as those looking to purchase in the smaller suburbs of Boulder County and the mountains face sub-markets where there is less than 2 months of inventory to compete for.
The sell-through rate of over 100% last week, and over 90% for 3 of the last 4 weeks, is further indication that we are still in a very resilient seller’s market.
A look at key market indicators – solds, new listings, under contracts and withdrawns – in the context of the COVID-19 timeline certainly indicates a recovery, at least in the short term.
On Monday, the National Bureau of Economic Research (NBER) announced that the U.S. economy is officially in a recession. This did not come as a surprise to many as most people realize that the pandemic shut down the country earlier this year, causing a significant decline in economic activity.
While consumers will undoubtedly remember the devastating impact the last recession had on the housing market just over a decade ago, the real estate market is in a totally different position than it was then. The four major differences in today's real estate market are:
1. Families have large sums of equity in their homes
2. We have a shortage of housing inventory, not an overabundance
3. Irresponsible lending no longer exists
4. Home price appreciation is not out of control