Colorado Springs Real Estate Blog

Absorption Rate is defined as: An estimate of the rate at which a particular classification of space - such as new office space, new housing, new condominium units and the like - will be sold or occupied during a specific time frame.

This is an important number for Buyers because it gives you a general ideal of the market conditions in a given area. Equally important for Sellers as it is a good indication, (when used in conjunction with our pricing grid) of what to expect in terms of “Days on Market”. Higher rates are an indicator of better market conditions.

We track activity in the 19 most popular MLS areas in the Pikes Peak Region. Here are the latest Colorado Springs/Pikes Peak Regional Absorption Rates.

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Lengthy market times, few showings and low ball offers seem to be a part of our new reality in the Colorado Springs Real Estate Market, at least for some homes. The early spring market seems to be breaking into three categories.

First and fast is the sub $200,000 market. These homes, if well priced, well staged and aggressively marketed, seem to be getting plenty of showings and even appear to be going under contract quickly.

The second stage of the market if the $250,000 to $400,000. This segment is slow, seeing few showings and even fewer offers. This price range is seeing a lot of bargain hunters. The $250,000 buyer trying to marry up to the $350,000 house. You really can’t blame them, every night on TV and in the papers we hear about the lousy housing market. Why wouldn’t they go shopping for bargains? Right now our job in this price range is to manage our sellers frustrations and our buyers expectations.

The third stage in our current market is basically $400,000 and up, kind of strange as $600,000 and up used to be considered the custom market. I think this market is more concerned with price as opposed to custom vs. semi custom. This segment of the market is moving at a glacial pace! Few lookers and even fewer offers. I am going to do a market overview after May 1st. my hunch is the statistics will prove this opinion to be true.

I think we will see more activity into May, June and July. Hopefully this activity spike will be in the higher price points. I am constantly hearing the following statement: “They love your listing BUT they have a house to sell in XYZ”. I think we might be looking at pent up demand by mid summer. As far as liquidity is concerned, all of the lenders I talk to seem to have money, at least for solid, credit worthy buyers.

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Here is a SWOT analysis of the Colorado Springs Real Estate market as of the end of quarter 1 2008.

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The Belltower Condominiums have broken ground and framing has begun. The Belltower Condominiums are a welcome addition to the Southeast Colorado Springs Real Estate market. This project will feature seven different floor plans starting in the $120’s. Square Footages range from 843 to 1,272 square feet, smaller units feature 1 bedroom and 1 bathroom. Larger units feature 2 bedrooms, 2 baths and lofts and Garages are available as an upgrade.

This is an exciting project as there really isn’t an abundance of newer condo product in the south east to central part of town, especially with this level of quality at this price point.

For more information visit http://www.BelltowerCondos.com

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Here’s a little insight from our good friend Ben Day: This comes from the ERA Shields Stat Pack. Ben and his team do some great work on this every month….Thanks, Ben

HERE IS WHAT IS GOOD TO KNOW, GOOD NEWS, BAD NEWS:
GOOD NEWS: Listing Volume was off 18.9%. That’s really good news. The trend of listing stimulus building up our supply may be near completion.
BAD NEWS: Demand was off the same amount, with sales at 722, off 19% from March 2007, a bad March for most sellers and REALTORS.
BAD NEWS: Our average selling price in March was only $236,503, off 7.2% year to date
GOOD NEWS: February’s average selling price was in the basement, so $236,503 was a $10,000 gain over February, so a 3% gain month over month is nice to see

So far, total sales volume year to date is off 24% in Single family/patio and 32% in condos/townhomes. If your pockets are feeling a little light right now, you’re clearly not alone.

Compared to the same time 2007, there are only 96 more total units for sale in our market. Builders still have a little more spec inventory than they would like. In existing home sales (condos and townhomes included) there are only 150 more properties for sale than the same time last year.

Demand is off about 20% from the same time last year, but the market is showing signs of heating up, not cooling off. Despite a lousy March for closed sales, the pending numbers seem to be picking up. PPAR is reporting a pending number that is a good 180 lower than what I quoted yesterday at 685. That is likely 685 new pendings in the month of March, with no January/February carry-over. But it is good to know that there are close to 900 pending sales in the MLS right now and another almost 300 under contracts.

I have not yet run months of inventory, area comparisons or price range comparisons and those numbers will not be pretty. But especially when you are educating buyers, have them take a look on the long-term. Ask what they see happening in supply and demand. ASK, ASK, ASK.

Don’t tell, ASK.

Ask: if supply is stabilizing, and demand among other buyers is low, is that a good thing for you?

Ask: if prices went up $10,000 last month, is that an indication that prices are going down?

Ask: if these are signs the market is stabilizing, and other buyers haven’t figured that out yet, is that good for you or bad for you?

Ask: How many times previously have you bought a home with a 30 year fixed rate at less than 6%?

Absorption Rate is defined as: An estimate of the rate at which a particular classification of space - such as new office space, new housing, new condominium units and the like - will be sold or occupied during a specific time frame.

This is an important number for Buyers because it gives you a general ideal of the market conditions in a given area. Equally important for Sellers as it is a good indication, (when used in conjunction with our pricing grid) of what to expect in terms of “Days on Market”. Higher rates are an indicator of better market conditions.

March 2008 Absorption Rates

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Absorption Rate is defined as: An estimate of the rate at which a particular classification of space - such as new office space, new housing, new condominium units and the like - will be sold or occupied during a specific time frame.

This is an important number for Buyers because it gives you a general ideal of the market conditions in a given area. Equally important for Sellers as it is a good indication, (when used in conjunction with our pricing grid) of what to expect in terms of “Days on Market”. Higher rates are an indicator of better market conditions.

2/2007 through 2/2008

As reported by the Pikes Peak Association of Realtors

Absorption Rate is defined as: An estimate of the rate at which a particular classification of space - such as new office space, new housing, new condominium units and the like - will be sold or occupied during a specific time frame.

This is an important number for Buyers because it gives you a general ideal of the market conditions in a given area. Equally important for Sellers as it is a good indication, (when used in conjunction with our pricing grid) of what to expect in terms of “Days on Market”. Higher rates are an indicator of better market conditions.

1/1/2007 through 1/31/2007

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Ok, you’ve priced your home correctly, de-cluttered, deep cleaned and staged it. Now you are ready for the showings to start but where are the buyers going to come from?

Today, buyers come from a wide range of places both online and off. The National Association of Realtors studies where home buyers actually come from. This study is published in their annual “Profile of Home Buyers and Sellers”.

Here are some statistics from the 2006 study. These numbers show the Information sources used in the home search by home buyers.

Notice “Luck” isn’t on this list. In any market, there is competition for the best buyers.In a slow market, that competition is for those buyers is extreme.

If you are serious about selling, make sure your marketing plan includes the real estate community, the Internet and a good sign.

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So you’ve decided that you are going to sell your home. At this point the first thing you need to do is to stop thinking like a home owner and start thinking like a home seller.

There is a big difference, a home owner wants to continue on with their life, they want few to zero disruptions in their day to day world.

A home seller on the other hand realizes that until the deal is closed they will have to make significant changes in their day to day life. Things like de-cluttering, keeping things picked up, vacating the property for showings and more.

This is why Step 1 was “Do you have to sell”? Because the market is so competitive, unless you are willing to be actively involved in the process of pricing, staging, de-cluttering, cleaning and maintaining your home, you’re probably better off not selling.

The truth is your competition is probably willing to do all of these things. So are you ready to think like a Seller?

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