Business as usual? Back to normal? Not yet, but silver linings and positive signs of moving forward are starting to show. One such light is the Boulder Farmer’s Market, which opens this Saturday, May 23rd. It will be different than past years, but it's a great start and beloved Boulder County tradition!
We can say the same thing about our local real estate market. Are the current market conditions normal? Not yet, but there are signs of normalcy as market activity resumes and our local economy begins to recover now that many restrictions are lifted. According to real estate industry expert Mike DelPrete, “The number of new listings coming to market is a key indicator of a healthy real estate marketplace, representing high-intent seller demand and available inventory.”
Over the course of the last week ending May 20th, new listing activity in Boulder and Broomfield counties was DOWN over 21% compared to the same week in 2019, but only 13.6% down from 2018 and almost even with 2017. Under contract activity was only down 2.4% compared to 2019, but up over a healthy 9.5% from the week before as pent up demand continues to catch up after very limiting restrictions on real estate showing and marketing activity.
The biggest impact to our market numbers is in closed transactions which were down over 63% compared to the same week last year. With inventory pulled off the market and no ability to show occupied properties in Boulder and Broomfield County during April and the beginning of May, fewer buyers pulled the trigger on a purchase decision. We expect that this will change in the coming weeks as showing activity picks up and consumer confidence begins to restore itself. The number of homes put under contract has risen steadily each week since showing restrictions were lifted and this will soon reflect in the sold data.
First-time home buyers continue to benefit from the new inventory listed in recent weeks and last week was no different. Almost 48% of all listings in Boulder and Broomfield Counties were in the $300,000- $599,999 range, with the most inventory in the $400,000-499,999 range. Buyers looking to escape to the suburbs will have the most luck in Lafayette and Broomfield as communities such as Erie, Niwot, Louisville and Superior continue to have very little inventory.
The sell-through rate is a key indicator of market activity, revealing how fast the new listing inventory can be absorbed within a certain timeframe. A high or increasing sell-through rate means that most of the new inventory is put under contract during that period. A low or declining sell-through-rate means that demand can’t absorb the new listings coming on, or could be due to seasonal fluctuations.
Mike DelPrete recently analyzed international real estate activity and based on evidence from several countries hit hard and early in the pandemic, it appears that the longer and more severe the lockdown, the faster the recovery. According to DelPrete, “The evidence suggests that once restrictions are lifted in the hardest hit markets, new listings rebound quickly. However, new listings are only one component of a full market recovery. Buyer demand, leading to completed real estate transactions, will come over time -- and it’s unclear how long that recovery will take.”
As we referenced in an earlier blog, Forbes recently named the Denver metro area one of the top best cities in the US for coronavirus recovery. In December 2019 Longmont was dubbed the number one boomtown in the country by SmartAsset, and in July 2019 Boulder was called the best housing market in the country for growth and stability. If any area has the buyer demand necessary for recovery that DelPrete references, the Boulder and North Metro Denver are could very well be top of that list as well!