COVID-19 Mondays With Matthew April 20, 2020

This Monday’s Topic covers U.S. New Homes:  

  • New Home Sales 
  • Household Formations 
  • Year Over Year Changes in Home Ownership vs Renters 
  • New Home Supply & Demand 
  • Impacts to New Development 
  • Looking Forward –  New Home Development 

How questions or feedback? Email me at justine.marx@windermere.com.

Posted on April 20, 2020 at 8:24 pm
Justine Marx | Category: Economics, Real Estate Outlook, WHO LOVES STATS | Tagged , , , , ,

Mondays with Matthew Gardner, Chief Economist at Windermere

Matthew shares his thoughts and predictions on how COVID-19 will impact the U.S. and our housing market.

This Monday’s Topics:
– Recession
– Health vs. Housing Crisis
– Supply & Demand
– Home Value

 

 

kind words following last week’s video, it makes me so happy
Posted on March 30, 2020 at 7:51 pm
Justine Marx | Category: Economics | Tagged , , , , , , , , , ,

COVID-19 – Mondays with Matthew

This Monday’s topics cover: 

– Economy Performance & Predictions by Quarter
– Unemployment Rates
– Need for Economic Stimulation

Posted on March 23, 2020 at 7:36 pm
Justine Marx | Category: Economics | Tagged , , , ,

Colorado Real Estate Market Update

The following analysis of the Metro Denver & Northern Colorado real estate market (which now includes Clear Creek, Gilpin, and Park Counties) is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact your Windermere agent.

 

ECONOMIC OVERVIEW

The Colorado economy continues to grow, adding 69,100 new non-agricultural jobs over the past 12 months, which represents a solid growth rate of 2.6%. That said, we are continuing to see a modest slowdown in employment gains, but that is to be expected at this stage of the business cycle. My latest forecast suggests that Colorado will add a total of 65,000 new jobs in 2019, representing a growth rate of 2.3%.
In November, the state unemployment rate was 3.3%, up from 3% a year ago. The increase is essentially due to an increase in the labor force, which rose by 77,279 people. On an un-seasonally adjusted basis, unemployment rates in all the markets contained in this report dropped between November 2017 and November 2018. The highest rate was in Grand Junction, but that was still a very respectable 4%. Fort Collins and Boulder had the lowest unemployment rate of 2.9%. All the regions contained in this report are essentially at full employment.

 

HOME SALES ACTIVITY

  • In the fourth quarter of 2018, 12,911 homes sold — a drop of 13.8% compared to the last quarter of 2017 and down 22% from the third quarter.​
  • The only market that saw growth in sales was Clear Creek, which rose by 3.8%. This is a small market, however, and is prone to rapid swings in price as well as sales. There was a significant drop in sales in the Denver market. I will be watching closely to see if this is an anomaly or a longer-term trend. At this time, I believe the former to be true.​
  • Interestingly, this decline in sales in Denver came as inventory levels rose by 37%. For now, I attribute this to seasonality and expect to see sales growth return in the spring.
  • Inventory growth continues to give buyers more choice, allowing them to be far more selective — and patient — before making an offer on a home. That said, well-positioned and well-priced homes are selling relatively quickly.

 

 

HOME PRICES

  • Despite the rapid rise in listings and slowing home sales, prices continue to trend higher, though the rate of growth is slowing. The average home price in the region rose 6% year-over-year to $454,903. Home prices were 2% higher than in the third quarter.
  • In all, the data was not very surprising. As with many markets across the country, affordability is starting to become an issue. However, the recent drop in interest rates likely stimulated buyers at the end of 2018 and I expect to see good price growth in the first quarter of 2019.
  • Appreciation was strongest in Park County, where prices rose 28.2%. We can attribute this rapid increase to it being a small market. Only Gilpin County saw a drop in average home price. Though this, too, is due to it being a very small market, making it more prone to significant swings.
  • As mentioned, affordability is becoming an issue in many Colorado markets and I anticipate that we will see some cooling in home price appreciation as we move through late 2019.

 

 

DAYS ON MARKET

  • The average number of days it took to sell a home in Colorado rose by one day compared to the final quarter of 2017.
  • The amount of time it took to sell a home dropped in four counties: Boulder, Larimer, Gilpin, and Park. The rest of the counties in this report saw days on market rise relatively modestly with the exception of the small Clear Creek market, which rose by 20 days.
  • In the fourth quarter of 2018, it took an average of 38 days to sell a home in the region, but it took less than a month to sell a home in five of the eleven counties contained in this report.
  • Housing demand is still there, but buyers appear to have taken a little breather. I anticipate, however, that the spring will bring more activity and rising sales.

 

 

CONCLUSIONS

The speedometer reflects the state of the region’s real estate market using housing inventory, price gains, home sales, interest rates, and larger economic factors.

For the fourth quarter of 2018, I continue the trend I started last summer and have moved the needle a little more in favor of buyers. I will be closely watching listing activity in the spring to see if we get any major bumps above the traditional increase because that may further slow home price growth — something that would-be buyers appear to be waiting for.

 

As Chief Economist for Windermere Real Estate, Matthew Gardner is responsible for analyzing and interpreting economic data and its impact on the real estate market on both a local and national level. Matthew has over 30 years of professional experience both in the U.S. and U.K.

In addition to his day-to-day responsibilities, Matthew sits on the Washington State Governor’s Council of Economic Advisors; chairs the Board of Trustees at the Washington Center for Real Estate Research at the University of Washington; and is an Advisory Board Member at the Runstad Center for Real Estate Studies at the University of Washington where he also lectures in real estate economics.

Posted on April 19, 2019 at 11:15 am
Justine Marx | Category: Buyers, Colorado Real Estate Market, Economics, Housing Trends, Sellers | Tagged , , , , ,

Why No Bubble

There are several reasons why our Chief Economist does not believe there is a housing bubble today in the U.S.

Below is a slide he shared at our recent market Forecast events.

It shows U.S. Home ownership rate, which is simply the percentage of the population who own their home (versus renting).

The long-term average is 65% represented by the red line.

In the graph you can clearly see the bubble forming. Starting in the mid-90’s, driven by several political and economic factors, more people than ever before became homeowners.

 

 

Then, starting in, 2008, the bubble burst and the percentage tumbled back down.

Now, as you can see, we are back at a “normal” level that resembles the long-term average.

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If you would like a copy of the entire Forecast presentation, go ahead and reach out to me. We would be happy to put it in your hands.

Posted on February 5, 2019 at 7:01 pm
Justine Marx | Category: Economics, Real Estate Outlook | Tagged , ,

Is There A Bubble?

Economists say there are three reasons why we aren’t in a housing bubble today.

The first reason they mention is the amount of new home construction compared to the 2006 housing bubble.
Today, along the Front Range, new home starts are down 38% compared to 2006. This is despite a much higher population than 12 years ago.
A major factor that caused the bubble was the glut of new construction inventory which doesn’t exist today.
Metrostudy, a leading new home research firm, says that Front Range builders need to have built 30,000 more new homes over the last 5 years to keep up with demand.
To see the whole story about our market along with other stats and trends, watch the recording of Tuesday’s Windermere Workshop right here.


If you want to be totally clear on all the stats, facts and trends in Colorado real estate so that you know what the future value of your home looks like, watch this video.
This is a complimentary service for our clients and friends.

Posted on October 2, 2018 at 7:30 pm
Justine Marx | Category: Colorado Real Estate Market, Economics, Fort Collins Real Estate, Home Facts | Tagged , , ,