Real Estate News
With the housing market booming I’ve had a number of folks ask me if we’re going to experience another housing bubble sometime in the near future. It’s a great question, so we decided to look at the historical data to look for a sensible answer. What we have done is attempt to correlate the population of metro Denver over the past 25 years with the number of single-family home sales per year to determine what the relationship looks like. What we found is fascinating!
The blue line on the chart represents the population of metro Denver over time. The red line is the number of home sales. What you see is that there definitely appears to be a relationship; the higher the population, the more home sales occur over the long term. But that relationship is skewed during market booms and busts.
During the recession that was ending around 1990 you see that there were fewer home sales than average. The economy was suffering so fewer folks bought homes. Then about 1991 the economy recovered and more people bought homes. We experienced the hyper boom of home sales from 2002 – 2006, then the crash of sales from 2008 to 2011.
So, where are we today? We are certainly in a recovery of home sales but still well below the historical average. I believe we’ll experience several more years of a strong sales recovery, at least into 2014 and probably into 2015. I expect the number of home sales to surpass 50,000 in 2014 before beginning the drop back to the historical average. I believe that we’re going to continue to experience a strong seller’s market for at least a few more years!
The best way to learn about investment properties is to go out and look at them. The more properties you see, the more you understand what is available, what condition they are in, what kind of work is required, and what sort of values you can expect. A great way to see properties is to join us on one of our frequent Your Castle property tours. We go out to different neighborhoods and look at lots of different types of properties to see what the market looks like. We do condo tours, duplex/fourplex tours, tours of homes of in different towns, luxury condo tours, small apartment tours, and lots of other fun and interesting tours. The tours are always free of charge and are really just classes in the field to help you better understand the real estate market around us. Let me know if you’d like to join us on our next tour and I’d be glad to get you on our schedule or email you the upcoming tours.
You’ve heard me say this for months but it bears repeating, the housing market is on fire and I need homes to sell! I have lots of buyers out looking for a home but there are so few available it’s challenging to find the perfect property.
What does it look like for a seller these days?
- Metro Denver home prices are up a whopping 12% in the past year.
- The inventory of homes on the market in metro Denver is the lowest since records have been kept, down another 31% in just the past year.
- The number of homes under contract is up 22% over this time last year.
- The average Days on Market for a home is down an amazing 24% in the past year.
Add it all up and you get the best seller’s market we have ever experienced. Sellers are reacting by hiking prices, testing the limits of the market, and pushing the envelope. And you can too. Call me if you want to discuss what your home is worth in this new seller’s market and how best to take advantage of it!