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Recent headlines about the national housing market certainly seem to be in conflict with one trumpeting "Good Signs for the Real Estate Market" and another "Home Prices Down in Most Cities." Or how about "New Home Construction Bounces Back - Soars 9.3 percent in November" versus "Home Sales Remain Weak."
And to add to the confusion, the National Association of Realtors just revised its annual home sales report knocking down annual sales 14.3 percent from 2007 through 2010.
The original report showed 4.9 million existing home sales for 2010, and the revised figure is now 4.19 million.
The good news is that the seasonally adjusted annual rate as of November is now at 4.42 million homes which is a 12.2 percent improvement over the 3.94 million pace in November 2010.
For more on the NAR revisions see Saturday's Real Estate Weekly.
New single-family home construction probably will total 440,000 for the year, the lowest level in the 50 years that records have been kept but home construction overall is up as apartment construction has doubled in the last year.
On the national level, the bottom line is that real estate sales are improving, helped in no small part by record low mortgage interest rates. On the other side of the coin, prices continue to fall. According to NAR, the national median price for existing homes was $164,200 in November, down 3.5 percent from a year ago.
The Case-Shiller 20-city index shows home prices fell in September and October and are now 32 percent below the index of five years ago.
On a broader level, the FHFA Home Price Index dropped 0.2 percent in October and is down 2.8 percent for the 12 months ending in October. The index is 19.2 percent below the April 2007 peak.
In Fort Collins and northern Larimer County, 2011 home sales are going to be within a whisker of the 2010 total halting a six-year drop that began in 2005.
This has come about due to a very nice turnaround in the last six months as home sales were down 13.3 percent at the end of June. More importantly pricing remains very stable with the average selling price in 2011 expected to be in the range of $250,000, a 1.5 percent increase from the previous year.
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Prices reached a peak of $253,406 in 2007 and after dropping 5.5 percent to $239,359 in 2009 have now recovered to within 1.5 percent of the 2007 level.
We had the opportunity this week to discuss the 2011 sales and get some insight into what to expect for the New Year with several leaders of the local real estate community: Chris McElroy, a broker/partner with The Group, Inc., a member of the Colorado Real Estate Commission and a director of the National Association of Realtors; Ken Anderson, a broker with ReMax Alliance who is now in his second go-around as president of the Fort Collins Board of Realtors and Gene Vaughn, broker/owner, ReMax Alliance.
All of us agreed that 2011 has been a good year for local real estate, and we were particularly encouraged by the 11 percent increase in sales over the last six months and the momentum this should bring to sales in the New Year. Here is kind of a compendium of the comments:
» Fort Collins is a great place to live, and we will continue to see national interest and be an attractive destination for a wide range of people from many diversified areas of the country.
» The stability of the real estate market with regard to the number of homes sold, the inventory and the pricing are of comfort when compared to the wild gyrations of many other areas.
» The economic engine that is Colorado State University and its continued growth, research funding and the added bonus of the excitement of the new direction in the athletics department.
» Stable home prices and low mortgage interest rates compared to high rental rates and low vacancies provide incentive to first-time home buyers as well as to investors.
Put another way, owning a home has never been more affordable and there are a multitude of benefits of ownership vs. renting.
The very real prospect of an improving economy, job growth and consumer confidence combine to give more people the opportunity to own their own home.
With more first time home buyers it is time for the move-up market to kick in, bringing more buyers to the higher priced home market.
No one was prepared to go out on a limb with any solid prediction, but the consensus is that we have weathered the recession very well and we can expect to see new growth in the housing market and relatively stable prices.
To put a number on it, we expect to see a minimum of 3,000 homes sold in 2012 which will be somewhere around a 4 percent improvement, and there does not seem to be anything to prevent home prices from gaining another point or two and finishing above the 2007 peak.
So go ahead, file this away and we will expect to hear from you in twelve months. In the meantime, we would like to wish you a safe and Happy New Year.
Prices reached a peak of $253,406 in 2007 and after dropping 5.5 percent to $239,359 in 2009 have now recovered to within 1.5 percent of the 2007 level.
We had the opportunity this week to discuss the 2011 sales and get some insight into what to expect for the New Year with several leaders of the local real estate community: Chris McElroy, a broker/partner with The Group, Inc., a member of the Colorado Real Estate Commission and a director of the National Association of Realtors; Ken Anderson, a broker with ReMax Alliance who is now in his second go-around as president of the Fort Collins Board of Realtors and Gene Vaughn, broker/owner, ReMax Alliance.
All of us agreed that 2011 has been a good year for local real estate, and we were particularly encouraged by the 11 percent increase in sales over the last six months and the momentum this should bring to sales in the New Year. Here is kind of a compendium of the comments:
» Fort Collins is a great place to live, and we will continue to see national interest and be an attractive destination for a wide range of people from many diversified areas of the country.
» The stability of the real estate market with regard to the number of homes sold, the inventory and the pricing are of comfort when compared to the wild gyrations of many other areas.
» The economic engine that is Colorado State University and its continued growth, research funding and the added bonus of the excitement of the new direction in the athletics department.
» Stable home prices and low mortgage interest rates compared to high rental rates and low vacancies provide incentive to first-time home buyers as well as to investors.
Put another way, owning a home has never been more affordable and there are a multitude of benefits of ownership vs. renting.
The very real prospect of an improving economy, job growth and consumer confidence combine to give more people the opportunity to own their own home.
With more first time home buyers it is time for the move-up market to kick in, bringing more buyers to the higher priced home market.
No one was prepared to go out on a limb with any solid prediction, but the consensus is that we have weathered the recession very well and we can expect to see new growth in the housing market and relatively stable prices.
To put a number on it, we expect to see a minimum of 3,000 homes sold in 2012 which will be somewhere around a 4 percent improvement, and there does not seem to be anything to prevent home prices from gaining another point or two and finishing above the 2007 peak.
So go ahead, file this away and we will expect to hear from you in twelve months. In the meantime, we would like to wish you a safe and Happy New Year.
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