Demand for new homes continues to build

New home sales and resales have begun rebounding in Northern Colorado, real estate broke brokers say.
More buyers are choosing new construction rather than resale homes again this year, said Susie Ewing, broker manager for The Group office in Fort Collins.
“A lot of people are showing more preference for new homes. Last year one out of every three homes sold in Larimer County was new and one out of every two homes sold in Weld County was new,” she said.
That trend has continued into this year.
“What we’re seeing is resale houses that are not priced right,” Ewing observed. “Buyers have a big choice and they can go to new construction and look in the same price range.”
This pattern tracks across the board on all price levels, she said. Houses in Wellington priced in the $180,000 to $200,000 range are moving well, as are upper end homes in Windsor’s Highland Meadows that sell for $300,000 to $400,000, she said.
“Builders have packaged their product quite well and they’re offering incentives,” she said. “We’re taking our resale listings and working with our brokers and sellers.”
For January through Aug. 31, 2004, new units sold in the Fort Collins and Loveland areas totaled 594, up from 541 from the same period last year. That amounts to about a 9 percent increase, said Jerry Crawford, managing broker for ReMax Action Brokers in Fort Collins. Resales for the period rose to 2,488, up from 2,278 a year before, about an 8 percent increase, he said.
“That’s certainly indicative of my office. From a company standpoint, it’s mirroring what’s happening for the county,” he said.
In a three-year comparison provided by the regional multiple listing service, a total of 4,164 units were sold for an average sale price of $217,548 in 2002.
In 2003, the number of units sold fell to 3,836, but the average sale price ticked up to $229,145.
For the period January through April 2004, 1,125 units were sold at an average price of $234,489. Another 1,956 units were sold in the period May through August 2004 at an average sale price of $229,707, he said.
“The indication is we will end up the year with more units sold than were sold in 2002,” he said. “We’re not seeing the quantity of activity but we are seeing quality activity. There are fewer buyers, but they are buyers. Even though the activity is down, I’m encouraged by the numbers,” Crawford said.
“Our unemployment rate went down here and that’s a compliment to the business community. Fort Collins is responsive and innovative,” he said.
He compared the local numbers to national figures that forecast existing home sales to rise this year. According to the National Relocation and Real Estate Magazine’s September edition, new home sales are expected to increase at a record 10.8 percent this year nationally, he noted.
Housing starts nationally are expected to grow at 2.6 percent above 2003. That would make it the strongest level since 1978, he said.
Doug Dodds, managing broker for Coldwell Banker Residential Brokerage in Fort Collins, agreed that the residential real estate market is up slightly over last year.
Total housing units sold in Larimer and Weld counties grew 5.5 percent in the first three quarters of this year over last year, he said.
During that period in 2003, some 7,993 new and existing homes were sold while 8,421 were sold this year, Dodds said.
“Our jobs stability is improving in Northern Colorado every day,” he said. “The economy is rebounding a little bit and interest rates have remained low. That’s a big determining factor. If inflation remains low next year, interest rates will stay low.”x09
Mortgage interest rates usually follow 2 percent to 3 percent above the inflation rate, he said. “That’s been real fortunate,” he said. x09
Many of the homebuyers are new arrivals from outside the area and outside the state, he said.
“We’re seeing some from California like we did four to five years ago,” he said. Because of steep housing prices in certain parts of that state, “some Californians can come out here and buy a house and have plenty of money left over,” he said.
He said his company’s relocation office has noted many more inquiries from Florida lately. “They’re getting really weary right now” after so many hurricanes hit the state this fall, he said. “Texas is also still strong as far as people moving up here.”