We have just completed our analysis of the Colorado Springs Real Estate Market statistics for the month of November 2008. This report is a mixed bag of good news, bad news and some optimism.
The market is not good but the Colorado Springs Real Estate is reacting in a couple of really appropriate ways. Additionally, pending troop moves provide a good measure of optimism….Read More
The numbers are in for November of 2008 and they are fairly lack luster. Median list price is a great indicator of the direction the market is trending towards. The median list price for November is down to $192,000.
This number is more an indicator of what we’re seeing hit the market as opposed to any major discount in prices. The trend for higher end home sellers is to either put the home into the rental market or to wait until the market turns around, if they can.
The most interesting aspect of this statistic is how judiciously the Colorado Springs Real Estate market moves. Here is a Year To Date look at the Average Listing Price in Colorado Springs.
The November 2008 numbers are in and although there is not a lot of great news there is some promising news. Listing inventory is at its lowest level of this year. Unfortunately, we can’t attribute this number to market health, we think it has more to do with sellers opting into the rental market or not opting into the market at all.
Having said all that, it’s still a good number to see, especially if you have your home on the market, this number has been as high as 10 months of standing inventory, earlier this year. Here is a a historic look at Colorado Springs Real Estate Listing inventory levels
We just Sold this beautiful two-story home in the popular Abert Estates community. This 5-bedroom, 5-bathroom home is located on 5 acres and features more than 5,390 square feet. The home sold for $650,000, that’s $120.00 per square foot, nearly $18.00 per square foot more then the average for the entire Northagte area.
Abert Estates features one of the best locations on the north end of Colorado Springs. This community features lots that average 5 acres and allow horses, all this in close proximity to the new Club at Flying Horse, Promenade Shops at Briargate, Pikes Peak Community College, the new Colorado Crossing , State Highway 83 and Interstate 25.
The popularity of Abert Estates has remained consistent even during these challenging times due primarily to it’s unique combination of amenities and location. To learn more about Abert Estates visit http://www.abertestates.com
Abert Estates is located in the northern part of Colorado Springs, Colorado. This community offers residents the opportunity to live in a relaxed equestrian community while staying in close proximity to some of the best amenities Colorado Springs has to offer.
Homesites in Abert Estates average 5 acres in size and allow for up to four horses per property. Thia area features some of the most incredible views in along the entire front range and is in close proximity to the Club at Flying Horse, The Promanade Shops at Briargate as well as the rapid growth and development we are seeing in the Interquest area.
This map will give you a sense of just how convienient the location is:
Jackson Creek is popular residential community located close to the northern edge of El Paso County, Colorado. Jackson Creek is just minutes from the north end of Colorado Springs and approximately 30 minutes south of Denver, Jackson Creek is one of the fastest growing parts of the Front Range.
Jackson Creek is a master planned community featuring 1,200 acres of traditional neighborhood, featuring shopping, restaurants, schools, open space and some of the most awe inspiring views along the entire front range of Colorado.
Jackson Creek offers a wide range of housing options from maintenance free patio homes and smaller single family homes to large estate quality custom homes.
This map shows the boundaries and amenities of the Jackson Creek neighborhood.
comScore, the leader in measuring the digital world, reports that 6.5 million Americans tuned into mobile video in the month of August. I think this is an incredible number. 6.5 Million people in the United States viewed mobile video in the month of August, 2008.
Now granted, most of it was “Evolution of Dance” type clips but I think this statistic points a big, flashing “Turn Here” (no pun intended) sign to any real estate professional that video is a marketing tool we need to embrace.
The big question is what is that going to look like? I think Real Estate video is very young, at least from a development standpoint. I think these numbers open the door for some great opportunities, especially for the entrepreneurial spirits out there.
So, although I don’t know how real estate video is going to look when it arrives, I do have a pretty good idea about where it’s headed.
DISCUSSION:
In the real estate industry, the joke of the last two years has been that you’d know when the market had turned when it looked better than your stock portfolio. In an unprecedented turn of events, at this writing, the Dow Jones Industrials are off almost 40% from their October 9, 2007 all-time high, while the first real signs of a market improvement have just shown in the local marketplace.
The Bail Out: There is no disputing that the turmoil that has rocked all the G8 Nations, not just the United States, began in the high rate of default in American home mortgages. If you have not bought or sold a home in a while, and it seems all so unreal that lenders were really giving out these loans, well, it was all pretty unreal. The rate of sale in Colorado Springs in 2004 was 10% higher than the previous best-year ever in 2003, and then 2005 blew away 2004. By 2005 and 2006, 40% of all national home sales were not primary residences. “Investors” (better called speculators) were so into real estate they were buying anything with 2×4’s and a roof. The housing bubble never really went burst, but it did deflate quickly. What burst was the lending bubble. How these homes were acquired was far too often due to exotic mortgages. While the rate of subprime loans was never more than 8%, it is factual that almost half the loans used to purchase homes in Colorado Springs in 2005 and 2006 were some form of 100% financing (VA less than 20% of that mix). So while media outlets rant about “toxic subprime mortgage securities” the problems are far deeper: when you look at the graph above, some ndividuals obtained loans when they shouldn’t have received loans (subprime). But that was 2 out of 25 loans. What was being pitched to the other 23 out of 25 were products no one should use (these were still called conventional). The problem was not just a sub-prime product. It was a sub-prime process with sub-prime thinking spread all around. Leverage is good. Over-leverage is bad.
Credit revolves around trust. Ninety-two percent of the loans were supposed to be made to trustworthy individuals. But the products themselves required infinite growth in the housing sector. The second that stopped, it seized the flow of cash, especially to those who made questionable loans. Now, banks and corporations don’t trust consumers, consumers don’t trust consumers, and banks don’t trust banks (the overnight lending rate is an astounding 5% add-on right now)
.“How on earth are the numbers getting better in Colorado Springs real estate? Apparently global credit is seized, and yet the Colorado Springs market saw more closings in September 2008 than September 2007. That doesn’t sound like a seized credit market.
Here are the new realities of loans: Though Must Have Assets. Though Must Have a Stable Stream of Income. Though Must Have Credit. Got the Trio? Go buy something. Lack one or more? You’re on the sidelines and for a while. Some lenders lent money in ways that were more flagrantly destined for failure than others. Today, a lender with a risky reputation has no liquidity. That means they have a hard time lending, and may be headed out of business. If a lender abused their investors’ trust by creating negative-amortized adjustable 80/20 financed loans for investment property (in layman’s terms, a risk on top of a risk on top of a risk on top of a risk on top of a risk… see Washington Mutual) that lender stopped receiving cash from their investors. This system only works with a steady infusion of currency, which in mortgage terms, is called a loan origination. The investors control the pipeline of origination with their cash. and no investor with cash has the desire to be fooled with right now. So the lenders with the highest rates of default are falling apart… quickly. The lenders that maintained some (or a lot) of dignity and passed up the easy bucks for a sustainable business model (see Chase, PHH, Wells Fargo), are often the companies the consumer hears today buying the smoldering assets of these other lending titans. Make no mistake: ALL LENDERS have tightened their underwriting. But in Colorado Springs, they funded over 700 purchases last month. For the first time since March, 2006, this local market can say “it’s actually better than it was last year.”
Remember sub-prime mortgages versus sub-prime thinking? The sub-prime mortgages went to only 8% of the population. The other 92% were offered crazy loans to make their expenses as low as possible. Some of that 92% is now in the category of a sub-prime consumer because their credit was laid waste in the implosion. But most of them are healthy and doing okay. The national numbers may be one in six with problems, but that is not the case in Colorado Springs. Year to date, the entire market is off around 7% in pricing. Most of the rest of the nation is off in excess of 10%, many competing markets in the west are off 15% or more. Most markets are in an inventory build phase: we are in inventory reduction. Most markets are seeing fewer and fewer buyers. We just saw an increase.
IN SUMMARY:
Stephen Covey’s famous circle of influence and circle of concern is writ large on the Fall, 2008 American Economy. There are the things you can’t control and the things you can, influence and concern. Right now, what is holding back the real estate market in Colorado Springs (and most of the Front Range) are national problems. Jobs aren’t being created, credit is tight, and our inbound buyers are still frustrated sellers in the markets they are coming from. But for buyers in the local market, this is as rich an opportunity as any in decades. Rates are at 6% or better on 30-year fixed mortgages. Colorado has had a surge in relocation traffic every year this decade creating new households for decades to come. Depending on the neighborhood you’re looking in, prices could be at 2005 or even 2004 levels. Inventory is down 12% from a year ago and sales activity was up almost 6%. Yes, the economy is in a recession. But chance favors the prepared mind.
Black Forest saw prices soften but sales increase for the month of September. This appears to be the result of pent up buyer demand in conjunction with seller motivation. As we have discussed here in the past, there are buyers in the market and the homes they are buying are the ones that are priced right. There are a lot of homes on the market so buyers have plenty of selection. When they see a deal, they know it.
High Forest Ranch is a private gated luxury home community, located at the northern edge of Colorado Springs, Colorado.
High Forest Ranch offers beautiful, home sites ranging in size from 2.5 to 39 acres. These sites feature towering ponderosa pines and views of the front range. pines and views of the front range.
Here is a quick look at the High Forest Ranch Market for October of 2008:
The November 2008 numbers are in and although there is not a lot of great news there is some promising news. Listing inventory is at its lowest level of this year. Unfortunately, we can’t attribute this number to market health, we think it has more to do with sellers opting into the rental market or not opting into the market at all.
We just Sold this beautiful two-story home in the popular Abert Estates community. This 5-bedroom, 5-bathroom home is located on 5 acres and features more than 5,390 square feet. The home sold for $650,000, that’s $120.00 per square foot, nearly $18.00 per square foot more then the average for the entire Northagte area.
