As we head into summer — and peak season for residential real estate sales — it’s instructive for would-be Front Range homebuyers to get a lay of the land and see how regional housing prices are stacking up.
A look to the southwest shows that average prices in Boulder are pushing toward the $1 million mark and beyond, reaching $956,342 in April (In fact, median prices in Boulder did reach $1.247 million for April). Scanning the Denver metro area, we see an average price of $518,154 in April. Focusing on average prices for single-family houses in the Denver suburbs, Arapahoe County reported $535,094, Jefferson County $530,687 and Douglas County $592,378.
By comparison, average sale prices on the north end of the Front Range are still coming in substantially below what our neighbors to the south are confronting. Boulder prices more than doubled the going rates in communities such as Longmont, Fort Collins, Greeley and Loveland (see the accompanying chart). Denver metro prices are easily 15-20 percent more than these Northern Colorado markets.
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Add it all up and there’s a resounding message: Even with local prices moving up and demand remaining high, buyers have opportunity to own in Northern Colorado at comparably favorable prices.
Wait at your own risk
In light of the above discussion of prices, it’s also worth examining the three options that most people weigh when it comes to housing decisions:
First, wait for a recession to bring the market down to a lower price range. But if that sounds like you, history isn’t on your side. Recently, Front Range prices made only a minimal slide during the Great Recession.
Second, choose the flexibility of renting — but lose out on the long-term wealth creation that home ownership provides.
Third, buy and invest in the largest asset class in the United States. And as we highlighted earlier, that opportunity on the Front Range is far more accessible in Northern Colorado.
Here are some additional highlights from April real estate sales in the area:
Sellers are still in the driver’s seat. Need proof? Look at the average sale-to-list price for local markets: Berthoud, 99.9 percent; Fort Collins, 100.3 percent; Greeley, 99.9 percent; Loveland, 99.6 percent; Wellington, 99.8 percent; Windsor, 98.9 percent. In other words, buyers are not finding much in the way of discounts and may even be bidding up the price in some cases.
The inventory squeeze remains tight. Overall availability of homes for sale in the region, including Boulder, was down 9.3 percent in April. Only Timnath, up 43.6 percent, experienced any meaningful inventory growth for the month.
The lack of inventory continues to be a drag on sales totals, which were down 2.8 percent across the region for April. Thanks to a surge in construction, the Windsor-Severance market was a notable exception, with home sales increasing 74 percent over the previous April.
We found one potential sign of prices easing up this spring. The Estes Park, Greeley/Evans, Loveland/Berthoud, and Windsor/Severance sub-markets all reported average sales prices slightly below their first quarter averages.
Brandon Wells is president of The Group Inc. Real Estate, founded in Fort Collins in 1976 with six locations in Northern Colorado