denver housing market report - what happened in september?

via EIN NEWS

By WastonBuys.com | Published October 15, 2020

What happened in September?

Lets discuss.

Denver housing market has set new records again. This is despite Corona-virus. Many pros thought the headwinds of slowing economy and then COVID would cause a pullback for Denver homes but this has not been the case.

Across the board, indicators show gains year on year. The main reasons for continued appreciation are:

1. Housing demand remains very high. Denver still has a net migration increase despite rising house prices. Great companies are still moving to Denver bringing even better jobs.

2. Interest rates are still historically low. This allows more buyers into the market and allows buyers to pay more as mortgage payments are lower relatively.

3. Housing Inventory is unbelievably low. This is due to new homes not being built fast enough and existing homeowners not choosing to list. New home builder and local expert in Denver had this to say. "Raw material prices are increasing dramatically and we have had a labor shortage for years. These two factors are key in pushing up the cost of building. So we either can't afford to build or have to charge a lot more." This is also reflected in the Colorado Rockies resort communities where the, ‘we buy houses’ business in Avon had this comment. "We have noticed people selling homes in Avon are pushing the boundaries and ceiling of the upper limit of what potential buyers are willing to pay causing a slight pause. However, I feel this is the pause we saw in Denver about 8 months ago so I expect yet another strong upward movement in house prices over the next 12 months in Vail, Avon, and other Colorado Rockies resort communities.

For the second time now we have seen Denver house prices surpass $600,000. Last month and now. Properties in the $300,000 to $399,999 are flying off the shelf. New listings remain down when compared to this time last year.

The numbers that have been released continue to show that now is a good time to sell your house in Denver. Denver's strong economy allows potential buyers to bid higher for any given property.

Denver house buying experts we spoke to expect home price records are the result of low rates, strong job market, low unemployment rates, and a steady economy. One concern, which is not a new one, is the affordability of houses for people in Denver.

Denver House prices, trends, and other news.
Let’s take a quick look at the local economy.

Right now let's discuss home prices and the economic growth in neighborhoods in and around Denver so you can understand the way the Denver real estate market is moving. Denver is one of the hottest real estate markets currently in the entire nation and over the last decade or so the annual appreciation for houses has been around 7%.

Denver has some public transportation including buses and rail systems. The light rail system is going through a metamorphosis currently with many new lines being built in the last 5 years and more in the works. Denver is also a very bikeable city. The downtown area in September is extremely walkable. In fact, a walk score is currently at 93 out of 100.

Impact of covid-19 on the Denver real estate market.
Despite the current pandemic the prices of houses have continued to go out. As previously mentioned, the average price tipped $600,000 in the last month. Many experts believe that COVID has caused inventory to lower more than ever before. This is because people do not want to move right now. This puts increased pressure on the real estate market. People that do list their homes are easily able to sell them for a fair price.

Let’s do a quick final summary.

The month of August saw a record number of properties get sold compared to previous years.

6381 houses closed.

Single-family homes sold for a record high. This high was $602,191. This is a 13% increase - year over year.

The average days for the time a house was listed was at 23 days.

new apartments in the suburbs attract new yorkers

via The New York Times

By Sydney Franklin | Published September 8, 2020

City residents head to new developments in walkable suburban communities where they can get apartments with more indoor and outdoor space.

Some New Yorkers who have moved out of the city since the beginning of the pandemic headed to the suburbs, but not to a typical suburban life.

Instead of a house with a picket fence and a front yard, many urbanites have opted to rent in newly developed apartment buildings or to buy condominiums in denser, walkable suburban communities, where apartments tend to be bigger and offer more outdoor space than comparable units in the city. The increased traffic from city dwellers surprised developers at first, but it quickly became clear that many New Yorkers were hoping to secure what they felt would be a safer, short-term future outside the borders of the city.

“Back in April, the narrative of this outbound migration to the suburbs was anecdotal,” said James Fitzpatrick, division president for luxury home builder Toll Brothers. “But over the past three months, that’s now become real and measurable for us.”

Sales on single-family homes in the suburbs spiked when the pandemic began in March. Many families fled New York in search of temporary rental homes or permanent second homes where parents could work remotely, children could attend online classes and everyone could enjoy the summer with sufficient social distancing. New Yorkers who chose to leave the city for a new apartment or condominium, however, had different priorities, namely an affordable and active lifestyle — two things that a locked-down New York no longer offered.

“Affordability became paramount almost overnight,” said Jonathan Miller, chief executive of Miller Samuel Real Estate Appraisers & Consultants. “Covid-19 removed, in the short term, a lot of the things in New York that make it the reason to be there.”

Nowhere is this shift more visible than in the suburbs of northeastern New Jersey. Until the pandemic, Hudson County, which includes Hoboken and Jersey City, was the top-performing real estate market in the state, according to Jeffrey Otteau, president and founder of Otteau Group, a real estate analytics and appraisal firm. But demand for condos, a popular market in this part of New Jersey, dropped by 13 percent from January through August of this year. The rental market there also suffered as people moved farther out into the state. Now, there are over 1,300 fewer occupied apartments in the area.

The rental market just beyond Hudson County, however, is a different story. Across the state’s 19 more suburban counties, new apartment complexes have popped up to take on-demand.

Next door in Essex County, PEEK Properties is opening a 39-unit rental complex at 475 William Street in downtown East Orange. In the two weeks since launching the property’s leasing website, the developer has received over 50 inquiries from prospective tenants, with 60 percent of them coming from New York.

At the end of August, Sherri and LeRoy Lambert moved out of their two-bedroom apartment on the Upper West Side and back to Maplewood, N.J., a place where they had lived and raised their children for 28 years. After also exploring rental options in South Orange, the Lamberts moved into a one-bedroom apartment at Clarus Maplewood, a three-year-old, 20-unit development by JMF Properties.

Mrs. Lambert described the decision as their most logical move for the time being. They plan to relocate permanently to their second home in New Orleans in about five years. “When we were deciding to leave the city it didn’t seem like we wanted to live in some random community,” she said. “Maplewood felt like coming home.”

At Quin Sleepy Hollow, a building in JMF Properties’ portfolio that opened last November in Plainfield, N.J., an average of 12 apartments leased from March to July, but the number jumped to 20 leases in August, and more than a third of the new tenants were New Yorkers.

Seventeen miles north in Bergen County, BNE Real Estate Group two weeks ago started leasing at One500, a 228-unit luxury rental. Thirty-four percent of the newly signed leases have gone to former New York residents.

Benji and Arielle Klein are moving to a two-bedroom apartment at One500 this week from their 600-square-foot spot on the Upper West Side. A handful of their New York friends signed leases in the building as well. “I’m honestly sad to leave the city, but it does help that our friends are there and we’ll have a balcony,” said Mrs. Klein. “We are paying much less for almost double the space.”

Suburban New Jersey isn’t the only area that has benefited from this urban flight. New buildings on Long Island, and in Westchester and Rockland Counties have also seen increased interest from New Yorkers.

At Harbor Landing, a 385-unit, luxury rental complex in Glen Cove, Long Island built by RXR Realty, Joseph Graziose Sr., the company’s executive vice president of residential construction and development said that initially, about 80 percent of the people who viewed Harbor Landing came from within an eight-mile radius of the building. “Now, we’re probably renting to about 30 percent of customers coming east, including New Yorkers,” he said.

Suburban condominiums like the Brownstones at Edge-on-Hudson in Sleepy Hollow have seen a boost in sales since June as well, with about 65 percent of new residents coming from the five boroughs.

Straight east and situated on Long Island Sound in Stamford, Conn., Harbor Point — an 11-building, 3,400-unit development — has welcomed scores of New Yorkers to its newest tower, Allure, in the last few months. Since June, 188 new leases have been signed, according to Ted Ferrarone, co-president of the site’s developer, Building and Land Technology, and about 35 percent of the residents who moved into the building in June came from New York. Three more buildings are under construction in the development.

“The pandemic has turned into a real driver of demand,” he said. “Interest across all our properties slowed for about three weeks at first, but then traffic really ramped up.”

Erika Colon, a headhunter for Covid-19 nurses and the owner of her own recruiting agency, moved to Allure in May after seven years in a 400-square-foot East Village studio apartment. Without a proper desk to work from, she often made phone calls from her bed during the pandemic.

Ms. Colon, who is originally from Stamford, now lives in a one-bedroom, corner unit with ample space and a waterfront-facing balcony. She said she now has enough room to breathe and focus on work.

“Sometimes you have to do something to make sure you feel comfortable from a mental health standpoint,” she said. “New York will always be there. It’s just a train ride away.”

are you ready for the summer housing market?

As the health crisis started making its way throughout our country earlier this spring, sellers have been cautious about putting their homes on the market. This hesitation stemmed primarily from fear of the spread of the coronavirus, and understandably so. This abundant caution has greatly impacted the number of homes for sale and slowed the pace of a typically busy spring real estate season. Mark Fleming, Chief Economist at First American notes:

“As more homeowners are reluctant to list their homes for sale amid the pandemic, the supply of homes available to potential home buyers continues to dwindle.”

With many states beginning a phased approach to reopening, virtual best practices and health and safety guidelines for the industry are in place to increase the comfort level of buyers and sellers. What we see today, though, is that sellers are still making a very calculated return to the market. In their latest Weekly Housing Trends Report, realtor.com indicates:

“New listings: On the slow path to recovery. Nationwide the size of declines held mostly steady this week, dropping 23 percent over last year, a slight increase over last week but still an improvement over the 30 percent declines in the first half of May.”

Although we’re starting to inch our way toward more homes for sale throughout the country, the number of homes on the market is still well below the demand from buyers. In the same report, Javier Vivas, Director of Economic Research for realtor.com shares:

“Sellers have yet to come back in full force, limiting the availability of homes for sale. Total active listings are declining from a year ago at a faster rate than observed in previous weeks, and this trend could worsen as buyers regain confidence and come back to the market before sellers.”

Lawrence Yun, Chief Economist at the National Association of Realtors (NAR) seems to agree:

“In the coming months, buying activity will rise as states reopen and more consumers feel comfortable about homebuying in the midst of the social distancing measures.”

What we can see today is that homebuyers are more confident than the sellers, and they’re ready to make up for lost time from the traditional spring market. Summer is gearing up to be the 2020 buying season, so including your house in the mix may be your best opportunity to sell yet. Interest in your house may be higher than you think with so few sellers on the market today. As Vivas says:

“More properties will have to enter the market in June to bring the number of options for buyers back to normal levels for this time of the year, nationwide and in all large markets.”

Bottom Line

If you’re ready to sell your house this summer, let’s connect today. Buyers are interested and they may be looking for a house just like yours.

will the housing market turn around this year?

Today, many people are asking themselves if they should buy or sell a home in 2020. Some have shifted their plans or put them on hold over the past couple of months, and understandably so. Everyone seems to be wondering if the market is going to change and when the economy will turn around. If you’re trying to figure out what’s going to happen and how to play your cards this year, you’re not alone. This spring in the 2020 NAR Flash Survey: Economic Pulse, the National Association of Realtors (NAR) has been tracking the behavior changes of homebuyers and sellers. In a reaction to their most recent survey, Lawrence Yun, Chief Economist at NAR, noted the beginnings of a turn in the market:

“After a pause, home sellers are gearing up to list their properties with the reopening of the economy…Plenty of buyers also appear ready to take advantage of record-low mortgage rates and the stability that comes with these locked-in monthly payments into future years.”

What does the survey indicate about sellers?

Sellers are positioning themselves to make moves this year. More than 3 in 4 potential sellers are preparing to sell their homes once stay-at-home orders are lifted and they feel more confident, which means more homes will start to be available for interested buyers.

Just this week, Zillow also reported an uptick in listings, which is great news for the health of the market:

“The number of new for-sale listings overall has shown improvement, up 5.9% last week from the previous week. New listings of the most-expensive homes…are now seeing the biggest resurgence, up 8%. The uptick is likely a sign sellers are feeling more confident because of improving buyer demand, as newly pending sales have also jumped up during the same period.”

What does the survey note about buyers?

The recent pandemic has clearly impacted buyer preferences, showing:

• 5% of the respondents said buyers are shifting their focus from urban to suburban areas.

• 1 in 8 Realtors report changes in desired home features, with home offices, bigger yards, and more space for their families becoming increasingly important.

• Only 17% said buyers stopped looking due to concerns about their employment or loss of a job.

As we’ve mentioned before, buyer demand is strong right now, and many are simply waiting for more inventory to become available so they can make a move, especially as the country begins to reopen.

Bottom Line

If you’re thinking about putting your house on the market, let’s connect today. There’s a good chance an eager buyer is looking for a home just like yours.