Home prices, sales soar – and, yes, it’s weird

Home-selling prices in the four-county BizWest region (Boulder, Broomfield, Larimer and Weld) continue in uncharted territory with double-digit increases in both home sales and median selling price. The rate of increase actually slowed a bit in April with a 12.3 percent increase in median price, but the number hit $300,000 for the first time, boosting the year-to-date median price to $294,000.

By areas, the price-increase parade is headed by Larimer County which shows a 21.1 percent increase in the median price for the year to date. This certainly would seem to be an unsustainable rate of increase, particularly when compared with a 7.5 percent increase for all of 2014. All of the price increases are due to a rising demand for homes and a limited supply of homes for sale. The net active inventory improved slightly to 2,540 homes, but this compares to 4,000 homes a year ago and a figure of 10,000 required for a balanced market. With a 2.5-month supply, obviously sellers are in command and there is a lot of competition among buyers leading to multiple offers and escalation clauses, particularly in the lower price ranges.

The Denver metro area is making headlines as one of the country’s top 10 costliest housing markets with a 14.2 percent increase in April compared with the previous year, according to Zillow. The Denver Metro Association of Realtors shows the increase for April at 11 percent with an average sales price of $361,915. For the record, the four-county region we track recorded an average price of $356,619 in April, which was a 9.4 percent increase compared with last year.

Where we go from here is anybody’s guess. Obviously, all the pundits’ predictions for this year are out the window. At the present pace, we would end the year with 21,000 home sales at a median price of $305,000. This would result in a total market of close to $8 billion.

For the sake of comparison, at the bottom of the market five years ago, there were 13,647 homes sold at a median price of $220,000 for a total volume of $3.7 billion. It is too early to start predicting annual sales, particularly when we have no idea where the sales are coming from, but we continue to be amazed at the resourcefulness of the players in today’s market; somehow they keep finding homes to buy and sell – and prices be damned!

Dave Pettigrew is a real estate broker at Ascent Real Estate Professionals, 2700 S. College Ave., Fort Collins. Contact him at FCRealtor@msn.com or 970-282-9305.

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