We had an interesting week last week and thought we would share it with you. We wouldn’t call it a typical week, but there probably isn’t a typical week in the life of a professional Realtor. Most of this activity is in addition to the normal real estate life of prospecting, marketing, networking, budgeting, learning and staying on top of the business.

It started on Sunday when we dealt with an offer on a property we had listed – just four days earlier. On Monday we presented a counterproposal to the original offer which was accepted by the buyer so we now had the property under contract. A lot of stuff has to happen at the time a property goes under contract so that kept us busy on Monday. Plus we had to prepare for Tuesday when we hosted our regular office sales meeting at an on site model and made a presentation to our office agents on a $15 million project we have listed.

On Wednesday, we hosted clients from Maryland. They found us through the internet and visited the Fort Collins area six years ago. We stayed in touch and having just become empty nesters, they were back for another look. We put on our Chamber of Commerce hats and put them in the car, visiting eight or nine different neighborhoods which took us literally all around town. We looked at few homes, had the obligatory lunch in old town and pitched the Fort Collins lifestyle. We invited them to our home on Wednesday evening for a social evening and spent more time with them on Thursday before they headed to check out Genesee and Evergreen. They are also considering relocating to North Carolina but promised us a decision when they got back home.

Friday brought another out of town client, this one from Milwaukee. She works for a company that is expanding and she was taking over supervision of their western operations. The company allowed her to pick the location for her home base and she wanted to get back to the mountain region – she had attended college in Montana – and selected Fort Collins. She also had found us through our web site and visited three weeks ago to look around, went back to Milwaukee, got her home there under contract and headed back here to find a home. We looked at homes on Friday and again on Saturday, she made a decision, we prepared the purchase offer and got it signed and delivered to the listing agent on Sunday. The offer was countered and accepted on Monday.

We also had clients that arrived on Friday from Massachusetts. They too are recent empty nesters and decided to check out Fort Collins because some very good friends of theirs just recently relocated here from Ohio. We had helped their friends find a new home in Fort Collins and they were nice enough to refer us. We had been in touch with them over the last couple of weeks – via email – and visited with them Friday evening for a little social talk about the area. We did the Chamber of Commerce thing on Saturday and visited a few homes that they had selected from the internet to give them an idea of the market. We hosted an open house on Sunday afternoon then met with them again late Sunday to show another home and their friends hosted a bit of a neighborhood party for them on Sunday evening to help with the pitch.

Obviously we don’t have three potential buyers in town every week so that made it a bit atypical but working with home buyers and sellers is what this business is all about. It is particularly enjoyable when you get a chance to show off this wonderful area and you might be surprised to know how impressed visitors are with our town and the region. We know there are those among us who don’t like growth and wish they could keep things status quo but we can tell it is not going to happen. There are too many good reasons for people to want to live in this area and, for the most part, we believe these new arrivals add energy and value to the community and we welcome them with open arms.

New home sales are way down, both locally and nationally, and that is not good news for the economy. On a national basis, new single family homes have normally been about 15% of the total home sales and sales of new homes peaked in 2005 with a total of 1.283 million out of 8.359 million home sales. Sales for this year are on a pace for 512,000 new home sales out of a total of 5.502 million home sales. This is the lowest total for new home sales in nearly two decades and also is a projected drop to just 9.3% of total home sales. These sales are down 40% from a year ago. The low sales and high inventory are dragging down prices which are now off 26% from a year ago to a current median price of $231,000.

Locally, new home sales to the end of June are down 28.7% from last year, on top of a 29.4% drop for the same period in 2007 compared to 2006. New home sales now account for 12% of total single family sales compared to 19% two years ago. In the region, the news is worse with the Loveland area off 33% for this year on top of a 35% decline the previous year and Weld County down 50% this year after a 7.5% drop last year.

Not all new home sales are reported through the multi-list system but building permits tell the same story. Permits for new single family construction are down 30.2% for the first six months of this year and are on a pace for 285 for the year. This compares to 345 in 2007 and 442 in 2006, a drop of 35% in two years.

Based on sales over the last year, there is a demand for 18.3 new homes per month in the Fort Collins area. Almost 60% of this demand is for homes priced under $300,000. There are currently 173 active listings for new single family homes which represents a 9.5 month supply but less than half of these homes are actually complete or under construction so we actually have just a 4 month supply of inventory. This ranges greatly by price range with less than a one month supply of standing inventory priced below $300,000 to a twenty month supply for homes priced above $1 million. If you are considering the purchase of a new home, you may have to enter into a contract to begin construction on a home priced below $400,000. Above $400,000 there is some standing inventory and you should be able to find a home that will fit your needs but for the most part these homes are not being replaced with new construction starts so when they are gone, there could be an actually shortage of new homes to choose from. You will find the builders in this price range very accommodating and you can probably make a deal that will make you happy and keep the builder in business. The relatively low inventory of new homes for sale has to be the reason that prices are holding up very well, particularly when compared to the national figures. For the year to date the Fort Collins area average price is up 6.0% to $362,323 and the median price is up 0.5% to $253,001.

The weak move up market has obviously hurt new home sales in the higher price ranges as has the jumbo mortgage market which now charges a premium of about 1.25 points over a conventional fixed thirty year mortgage compared to a premium of 0.5 points a year ago.

Home construction is a very important part of the economy. The National Association of Home Builders estimate that the local impact of building 100 single family homes in a typical U. S. metropolitan area include $16.0 million in income, $1.8 million in taxes and other revenue for local governments and 284 local jobs. The additional, recurring impact for 100 single family homes include $3.2 million in local income, $648,000 in taxes and other revenue for local governments and 63 local jobs. These are ongoing, annual local impacts that result from new homes being occupied and the occupants paying taxes and otherwise participating in the local economy year after year. With the drop in single family home building permits of over 250 homes in the last couple of years, this is $40 million of income, $4.5 million in taxes and other revenue and 710 local jobs that have gone missing plus the ongoing impact from not having the occupants of these new homes adding to the local economy. And new homes are not just about growth, a lot of new homes replace old homes and bring energy saving efficiencies and other benefits to home owners.

So help us out – go and buy a really new home!

Finally, a month of sales that we can crow about…a little! Local real estate sales in June were the best month since last July and, while still a decrease from June 2007, the drop put an end to the double digit decreases we have experienced every month since last September. The average selling price also showed a very modest increase, but an increase nevertheless and the fourth month this year on the plus side.

As the sales table shows, there were 402 homes sold in June, a 13.2% increase from the previous month but a decline of 8.8% from a year ago. This results in year to date sales of 1,649 homes, down 12.6% from this point in 2007. The average price was up 0.3% to $249,115 and the year to date average selling price is $250,910, an increase of 0.6% from last year. The median sales price in June was down 2.6% to $210,658 and the year to date figure is $210,000, down 2.3% from 2007.







June closed sales averaged 103 days on the market compared to 114 last month and 111 in June last year. For the year to date, marketing times have improved from an average of 125 days last year to 114 days this year. The inventory of homes for sale dropped at the end of June to 2,074 compared to 2,154 at the end of May and 2,462 last year. The supply of homes is equivalent to about 7.5 months compared to close to 9.0 months supply at this time last year. A balanced market between supply and demand is generally considered to be around six months so we are still in buyer friendly territory although this ranges dramatically by price point.

Sales in other areas of the region are considerably worse. The Loveland area had a decrease in sales in June of 25.2% coupled with a 14.4% decline in average selling price to $257,473. For the year to date sales are off 10.7% and the average price is down 5.6% to $260,063. In Weld County, June sales were down 26.7% and the average price was $202,187, a drop of 8.9%. This puts sales down 18% for the year and prices off 8.1% to $195,198.

A metro Denver area headline reads “Area housing may be recovering” and they report June sales increased 3.9% over May and were down 5.5% compared to June last year. The median price of a single-family home was up 1.5% from May but is still down 12.5% from 2007. Significantly, the number of homes on the market was down 13.7% from a year ago.

With half the year in the books it is difficult to predict where we will end up. The year to date 1,649 closed sales would normally equate to total sales in the range of 3,300 to 3,400 homes which would be the lowest total since 1997. But to even achieve this, sales in the next six months would have to equal the sales of the same period last year, at a time when we have been experiencing double digit decreases this year compared to last year and have a year to date drop of 12.6%. No matter where we end up, it is apparent that our market is in a lot better shape, for both buyers and sellers, than other areas of the region and a lot of other areas of the country and there is no reason to suggest it won’t stay that way.

New home sales are way down, both locally and nationally, and that is not good news for the economy. On a national basis, new single family homes have normally been about 15% of the total home sales and sales of new homes peaked in 2005 with a total of 1.283 million out of 8.359 million home sales. Sales for this year are on a pace for 512,000 new home sales out of a total of 5.502 million home sales. This is the lowest total for new home sales in nearly two decades and also is a projected drop to just 9.3% of total home sales. These sales are down 40% from a year ago. The low sales and high inventory are dragging down prices which are now off 26% from a year ago to a current median price of $231,000.

Locally, sales to the end of May are down 22.8% from last year, on top of a 29.4% drop for the same period in 2007 compared to 2006. New home sales now account for 12% of total single family sales compared to 19% two years ago. In the region, the news is worse with the Loveland area off 30% for this year on top of a 35% decline the previous year and Weld County down 52% this year after a 7.5% drop last year.

Not all new home sales are reported through the multi-list system but building permits tell the same story. Permits for new single family construction are down 23.6% for the first five months of this year and are on a pace for 295 for the year. This compares to 345 in 2007 and 442 in 2006, a drop of 33% in two years.

Based on sales over the last year, there is a demand for 18.3 new homes per month in the Fort Collins area. Almost 60% of this demand is for homes priced under $300,000. There are currently 173 active listings for new single family homes which represents a 9.5 month supply but less than half of these homes are actually complete or under construction so we actually have just a 4 month supply of inventory. This ranges greatly by price range with less than a one month supply of standing inventory priced below $300,000 to a twenty month supply for homes priced above $1 million. If you are considering the purchase of a new home, you will find a good selection priced above $400,000 but you may have to enter into a contract to begin construction on a home priced below $400,000. The low inventory has to be the reason that prices are holding up very well, particularly when compared to the national figures. For the year to date the Fort Collins area average price is up 3.2% to $363,825 and the median price is down 7.3% to $244,724.

The weak move up market has obviously hurt new home sales in the higher price ranges as has the jumbo mortgage market which now charges a premium of about 1.25 points over a conventional fixed thirty year mortgage compared to a premium of 0.5 points a year ago.

Home construction is a very important part of the economy. The National Association of Home Builders estimate that the local impact of building 100 single family homes in a typical U. S. metropolitan area include $16.0 million in income, $1.8 million in taxes and other revenue for local governments and 284 local jobs. The additional, recurring impact for 100 single family homes include $3.2 million in local income, $648,000 in taxes and other revenue for local governments and 63 local jobs. These are ongoing, annual local impacts that result from new homes being occupied and the occupants paying taxes and otherwise participating in the local economy year after year. With the drop in single family home building permits of over 250 homes in the last couple of years, this is $40 million of income, $4.5 million in taxes and other revenue and 710 local jobs that have gone missing plus the ongoing impact from not having these new homes. And new homes are not just about growth, a lot of new homes replace old homes and bring energy saving efficiencies and other benefits to home owners.