The end is near. Another year is about to hike over the horizon and a new year will magically make its presence known. The years seem to slip by more quickly these days as we try to keep pace with the newest cell phone, computer or television. Technology has made things smaller, more efficient and quicker. We would die of boredom waiting for an old IBM 286 to boot up; all fifty pounds of it.
Despite all the changes in technology over the past couple of decades, the purchase and sale of real estate has remained pretty much the same. It is still a hands-on business. Ultimately, all the final decisions are made by humans, not computers.
The pace of a real estate market isn’t defined by the human element, though. Statistics rule here. How many homes have sold this week, this month, and this year? How does that compare with last year or the year before that? Are home values going up or down? How many homes are on the market for sale? All questions requiring statistical answers.
Here are some statistics compliments of IRES (the Northern MLS). The year 2005 is used as a benchmark, since that has been the most active year for sales activity for the past six years throughout the Denver Metro and Northern Colorado real estate markets.
Through November/2005, there were 4,464 single family sales and 1,156 attached unit sales in Northern Colorado – Fort Collins, Windsor & Loveland. That compares to 3,250 single family sales and 684 attached unit sales through November/2010; approximately a 30% reduction in the number of sales. When looking at 2009 figures, single family home sales for 2010 are UP slightly (1,875 vs. 1,834); attached unit sales are down about 15% (505 vs. 597).
For the entire Northern Colorado real estate market (Boulder to Fort Collins), through November/2005, the Medium Sales Price was approximately $237,500; Average Sales Price was approximately $296,521. Through November/2010, the Medium Sales Price was approximately $230,000; Average Sales Price was approximately $286,704.
Statistics can be confusing at times. They can be manipulated to represent a specific position or point of view. If looked at solely from the perspective of what the numbers are, they don’t lie. So, what do the numbers above tell us?
• Sales are down noticeably from 2005. They have trended down every year since 2005 for the Northern Colorado market area. It is encouraging that the sales numbers for 2010 are comparable to 2009. Hopefully, an upward trend will materialize in 2011.
• Over the course of the past few years, the number of active listings in the market collectively as a whole has decreased. Sellers have decided to (a) stay where they are and not move; (b) wait for the market to improve and then move; or (c) rented their home and moved.
• Real estate market values haven’t improved since 2005. The upper end of the market has experienced the greatest negative impact from the economy. The lower end of the market has been able to sustain itself.
The government’s foray into assisting the housing market through tax benefits created some short-lived positive energy. Historic lows for home mortgage interest rates have helped people to refinance out of adjustable rate and interest only mortgages, but haven’t provided a noticeable shot-in-the-arm for home sales.
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