This trend is evidenced by three months’ worth of double-digit increases over the previous year in housing prices in Greeley and Evans, according to the most recent data from Information and Real Estate Services.
August, September and October saw increases of 19.2 percent, 24.2 percent and 22.2 percent, respectively. What’s more, the median price of a home in the submarket has risen in every month of 2012, with the exception of February, when home prices remained flat. April and May, meanwhile, saw double-digit increases.
In dollars and cents, this means the median home price in Greeley in October was $165,000, compared with $135,000 in October 2011.
Fort Collins and Loveland have also seen increases in median price in recent months, but the gains have been much smaller, at 4.3 percent and 3.3 percent, respectively.
Of course, Greeley’s price is still significantly lower than median prices in other parts of Northern Colorado, but the sustained improvement in home prices there is reason for optimism.
Chalice Springfield, managing partner at Sears Real Estate in Greeley, points to a basic tenant of economics as one reason for the jump in home prices.
“It’s partially about supply and demand,” Springfield said.
Greeley residents are beginning to purchase homes again, Springfield said, so much so that the number of active listings in the area dropped to 420 as of October, compared with 962 back in October 2008.
During the recession, homebuyers retreated and foreclosures created a glut of vacant homes on the market in Greeley, but improving economic conditions and a decrease in the area’s foreclosure rate have resulted in a nearly 11-percent drop in the number of active listings on the market year-over-year.
Foreclosure rates in Greeley have been steadily decreasing for nearly a year, with just a slight bump in April 2012 that dropped back down the very next month.
As of September, the foreclosure rate in Greeley was 1.41 percent, compared with 1.91 percent in September 2011, according to CoreLogic. Delinquency rates are also falling, from 4.88 percent in September 2011 to 3.93 percent a year later.
Delinquency rates track those homeowners who are 90 or more days behind on their payments. Greeley’s delinquency rate is still higher than Colorado’s, which was at 3.45 percent in September, but the area has made definite progress in the last year.
“Things have changed in the past 12 months,” Springfield said. “Interest rates are very low and those who were under water may not be any more.”
Like many other trends in Greeley, the oil and gas boom, as well as the entrance of Leprino into the market, can be considered partially responsible for improving conditions in the area.
Both of these have created new jobs and more disposable income for Greeley residents, and have also put a squeeze on the rental market in Greeley.
For months, it has been difficult, if not impossible, to find a single-family home to rent in Greeley, and those than can be found require rent that is between 10 and 30 percent higher than it used to be, depending on location.
Beyond the single-family market, it has been years since a new multi-family complex was constructed in the city, while multi-family developments are seemingly built left and right in Fort Collins.
“This is a prime opportunity for multi-family,” Springfield said. Because of low interest rates and even lower vacancy rates, some renters are beginning to buy, also contributing to the low housing supply.
Purchasing a multi-family unit in Greeley has also gotten more expensive as vacancies drop. The median price of attached dwellings in Greeley, which typically refers to multi-family homes such as apartments and condominiums, increased by 29.9 percent year-over-year in October.
Average rent in Greeley was at $693 per month in the third quarter, the highest it has been in at least five years.
The City of Greeley did issue permits for 10 units of multi-family development worth $1.1 million in September, indicating that perhaps this type of real estate might be ready for a comeback in Greeley.
While those in the market for a new home may not appreciate the prices of homes going up, the trend is an indicator of an improving economy.
“Weld County having positive increases is a sign of sustained change,” Springfield said.
Increased demand will drive new development, helping to bring back the construction industry and the jobs that go with it. Beyond that, real estate firms are also hiring new brokers to help keep up with the increased business.
The Group Real Estate, which has offices across Northern Colorado, has consistently been hiring all year, and Springfield’s company has added four new employees to its ranks within the last six months for a total of 38 employees.
Even with higher prices, those looking for a home can get more for their money in Greeley, Springfield said, a factor that is also contributing to the increase in demand.
“Affordability is huge in Weld County,” Springfield said.
Molly Armbrister covers real estate for the Business Report. She can be reached at 970- 232-3139, at firstname.lastname@example.org or at twitter.com/MArmbristerNCBR.