July was a big step backward with closed home sales down a whopping 21.4% from a year ago and 13.3% from last month. The local real estate market is now down 14.1% from last year and the streak of monthly decreased home sales has now reached all the way back to last September. There seemed to be some light at the end of the tunnel when June sales totaled 407 homes, a drop of 7.7% from a year ago but a significant 16% increase over the previous month but we obviously did not build on that momentum.

In addition to the drop in home sales, the average selling price is also down and now shows a slight decrease of 0.2% for the year to date. The median price is down more at $210,000 for the year to date compared to $215,000 last year, a decline of 2.3%. By major categories, the average price of a resale home for the year to date is $267,707 an increase of 2.3% from 2007 and the median price of $229,900 is exactly the same as a year ago. Newly built single family home sales are down 27% but the average price is up 4.3% to $355,438 and the median price is up 2.4% to $260,368. It is the multi-family category that is pulling down the market with the average price of $160,085 down 5.2%.

The total market value of closed sales for the year to date is $503M compared to $586M at this time last year which also means real estate commissions are off 14% for the year. With seven months of the year complete – or 60% as it normally relates to home sales, the market is on a pace for about 3,300 closed sales but if the 14% decrease continues over the next five months, it is possible we could be looking at closer to 3,000 closed sales. This would take us back to the three year period of 1995 – 1997 when annual sales averaged just over 3,000. In the ten years since then, sales have averaged 3,848 per year.

The marketing time for the closed sales in July averaged 103 days compared to 90 days last year. For the year to date, we are at 112 days this year, an improvement over the 118 days last year. The decline in the supply of active listings is helping to hold prices. The current supply of 2,031 homes compares to 2,379 listings at the end of July last year and 2,793 homes on the market at the end of July 2006. This means there is about a seven month supply of homes in total but it varies greatly by price range. Under $300,000, which accounts for almost 80% of the market, there is a five or six month supply. Above $300,000 there is a one to two year supply of homes so where you are positioned as either a buyer or seller depends a lot on the price point.

All in all, July will have to be recorded as a disappointing month but our local market remains in a lot better shape than many other areas although our situation is quite different. In most other markets both the average price and the number of homes sold are both down considerably. As an example, metro Denver reports a 6.2% drop in sales for the first seven months of the year. Coupled with 9.8% drop in the average selling price this gives them a total market volume decline of 14.4%. Closer to home, Weld County has a 14.3% drop in home sales and a 7.8% decline in average selling price, a total market volume decrease of 21%. Locally we have a 14% drop in total market but it is all in the lower number of homes sold – not affected by a drop in average selling price. Clearly contrary to the trend elsewhere, but that seems to be typical of our local market!