We are still in a strong seller’s market, with a mere 1.56 and 0.74 months’ of inventory of single-family homes and attached homes, respectively. And yes, prices are up an average of 14 percent for single-family homes and 20 percent for attached homes in the first six months of the year. (I covered Boulder’s crossing the $1 million threshold in a previous article.)
Notwithstanding the foregoing, the second half of 2016 will be the best time for home buyers to jump into the market for the foreseeable future. Here are three key reasons why.
Inventory. The inventory of homes in Boulder County typically peaks in the summer and gradually trails off in the second half of the year. There is typically an equivalent (or slight higher) number of homes on the market in the fall than in the spring.
Decreased competition. While the number of homes available is similar in the spring and fall, there are fewer buyers in the market in the second half of the year. There are myriad reasons for this, such as families wanting to be settled for the school year, but the upshot for buyers is that if you are home shopping in the fall and winter, you will be facing less competition for those homes. My colleague, Mike Malec, tracks the number of showings our company sets up per available listing, and that tracking clearly demonstrates the decreasing buyer activity in the second half of each year.
Flatter appreciation. When one looks at year-over-year appreciation in Boulder Valley, the last several years show fairly robust appreciation throughout the year. However, viewing appreciation on a month-by-month basis for the past five years reveals that most of the appreciation in our market typically takes place in the first half of the year. This flatter appreciation in the second half of the year means that buyers can feel less pressure when looking because the cost of delay is less than in the first half of the year.
Despite the continued seller’s market, the combination of a decent supply of homes on the market, less competition for those homes, and flatter appreciation in the second half of 2016 (not to mention historically low interest rates) equals as good an opportunity for buyers as we are likely to see in the Boulder Valley for some time.
Jay Kalinski is broker/owner of Re/Max of Boulder. He can be reached at firstname.lastname@example.org.