The middle of May sees the REALTOR Association in Washington, making a case to preserve the FHA and maintain its viability as the home financing vehicle of choice for many Americans wanting to buy their first home.  There are many reasons why the FHA might be in trouble, but there is no question that maintaining it as an important financing tool is paramount.  

Currently, congress is considering the passage of H.R. 4264, meant to assure the stability of the FHA.  We believe the bill is worthy of passage, providing a home financial tool for a large number of Americna home buyers.

1934 and the Federal Housing Administration is a post from: The Berkshire Group

The current real estate/economic picture in Denver remains positive for the individual home seller in the lower price ranges, but is becoming very stressful for buyers, especially in the prices ranges under $300,000.  For the first time in years sellers are receiving multiple offers, and many properties are receiving bids in excess of asking price.  There is growing confidence that the Denver area is in the beginning phase of a slow and long recovery. Resale inventory remains markedly lower than previous years, while closed sales are increasing monthly over 2011. With the first 4 months of 2012 showing continuing improvement over last year, interest rates remaining at historic lows, and the employment picture improving, the housing picture in Denver looks brighter than any time in the past 5 years.  Home Builders are noticing also, with building permits pulled jumping 52% over last year through March. A quick review of the Band Charts seen in The Berkshire Groups Newsletter show that over half of the Denver area market is trending toward a Sellers market.  Some neighborhoods are seeing well marketed and well priced houses receiving multiple offers in a short amount of time. But, the overall market is spotty.  The high end remains slow, and most likely will remain so during 2012. Buyers looking in the under $250,000 price range will continue to face stiff competition from investors looking to buy and hold for rental income. In short, the Metro Denver housing market continues 2012 stronger than in 2011, but complete recovery is still in the distance, with noticeable appreciation in the $400,000 price ranges probably not occurring until 2013.

New Home Permits (Metro Denver):

New Home Permits issued through March 2012:   1,040

New Home Permits issued through March 2011:      690

This is a 52% increase at the end of March YTD over 2011.

(NOTE: multifamily permits  issued through March increased by 19% over March YTD 2011.)

• Source: The National Association of Home Builders

Denver Area Residential Resale Statistics:

Average Single Family Home Sales Statistics for April, 2012 compared to April, 2011:

Year           Prices                  % of Change                 Days on Market       Inventory

2012         $298,712                +9.83%                              90                      8,353

2011         $272,339                                                              116                     13,874

Average Condo Sales Statistics for April, 2012 compared to April, 2011:

Year             Prices                      % of Change            Days on Market         Inventory

2012             $178,231                     12.49%                          91                          1,901

2011            $159,854                                                               125                         3,973

Total Combined Homes placed under Contract in April, 2012 = 5,681 vs. 4,549 for April, 2011

Total Closed Homes in April 2012 = 3,891 vs. 3,429 for April, 2011

Note: The average and median prices are now trending up, the volume of sales is up, and the available inventory remains historically low, signifying considerable improvement in the Metro Denver market.

• Source: Metrolist, Inc.

Employment Statistics for the Denver-Aurora MSA for March, 2012:

Year                            Labor Force               Employed        Unemployed       Rate

2012                             1,393,502               1,279,179            114,323              8.2%

2011                             1,388,123               1,266,030            122,093              8.8%

Consider that as the economy improves, more people will return to the job market, so the number of unemployed may actually increase. In March, the State of Colorado unemployment was 7.8%.

• Source: Colorado Department of Labor

Average National Mortgage Rates as of May 10, 2012

30 Year        15 Year           5/1 ARM               1 Year ARM

3.83%            3.05%               2.81%                      2.73%

There was little noticeable fluctuation in the mortgage interest rates from April, 2012.

The mortgage market continues to offer extremely low rates for qualified buyers.

All rates include a 0.6 % to 0.8% discount point. Rates quoted by any lender may not reflect momentary changes. Rates in the Denver area may be slightly higher or lower with a given lender at a given time. All rates noted in this report apply to the best qualified borrowers.

• Source: Freddie Mac National Website

*The Pulse is a review of key economic statistics that affect the Metropolitan Denver Area real estate market.  The Pulse is offered monthly as part of The Berkshire Group’s Monthly Update, and is current based on the information offered by the credited sources. The database is the 7 county Metropolitan Denver SMSA:

Tagged: Denver economic statistics, Denver housing economy, Denver real estate, Denver real estate market, economic statistics, employment statistics, national mortgage rates, statistics

The Market Pulse for May, 2012 is a post from: The Berkshire Group

The 15 day drop in average days on market is indicative of the pace of the market in Denver.

The available resale inventory continues to be abnormally low, which is good for sellers.

Total sales are on par with 2010, and that is without an artificial stimulus.

The Denver market has reached the same peak average as the previous two years, but two months sooner than those years.  This years average price may peak at $310,000.

Denver Real Estate Market Graphs for April, 2012 is a post from: The Berkshire Group

Denver Housing Market Update for April, 2012 is a post from: The Berkshire Group

Ashley Chinchilla is a post from: The Berkshire Group

So, what is next as the real estate saga continues?

The risk averse lending community will take time to adjust to the market conditions.  Loans will not be made without acceptable appraisals, and appraisals are difficult in a rapidly rising market.  Most home owners that may want to sell are not racing to the market, either out of economic uncertainty or their mortgage’s  are greater that the current market value.  As values increase, more owners will be tempted to sell, but the resale inventory will not increase in the short term.  Builders are just beginning to increase their efforts, but will lag behind demand, both because of  regulatory impediments and those pesky bankers reluctance to loan on projects.

Are we doing better? Absolutely.  Simple supply and demand curves show demand for product forces prices up. How much depends on everything from gas prices and Middle East sabre rattling, to local employment and community attitude.

Oh, yes, the boring stuff. In 2011, some 9.5% of those employed in Metro Denver were engaged in a real estate related occupation, almost 5% of of the entire population.  That group earned $6.3 billion, impacting the area economy in a big way. Assuming the average home sale contributes 10% of the home sale price to the various entities involved, last months average sale price created $28,500, which means the increase in closed sales over March 2011 added $7.6 million to the Denver economy.  That is a great deal of money when spread around to restaurants, dry cleaners, book stores and movie theaters. And remember, the traditional best sales market in Denver is spring, so we are just getting started.

The Really Boring Stuff is a post from: The Berkshire Group

The current real estate/economic picture in Denver remains positive for the individual home seller in the lower price ranges, but is becoming somewhat stressful for buyers.  For the first time in years sellers are receiving multiple offers, and properties are receiving bids in excess of asking price.  There is growing confidence that the Denver area is in the beginning phase of a slow and long recovery. Resale inventory remains markedly lower than previous years, while closed sales increased in 2011 from the previous year. With the first 3 months of 2012 showing continuing improvement over last year, interest rates remaining at historic lows, and the employment picture improving, the housing picture in Denver looks brighter than any time in the past 5 years.  Home Builders are noticing also, with building permits pulled jumping 75% over last year in February. A quick review of the Band Charts seen in The Berkshire Groups Newsletter show that over half of the Denver area market is trending toward a Sellers market.  Some neighborhoods are seeing well marketed and well priced houses receiving multiple offers in a short amount of time. But, the overall market is spotty.  The high end remains slow, and most likely will remain so during 2012. Buyers looking in the under $250,000 price range will continue to face stiff competition from investors looking to buy and hold for rental income. In short, the Metro Denver housing market enters 2012 in better shape than in 2011, but recovery is still in the distance, with noticeable appreciation probably not occurring until 2013.

New Home Permits (Metro Denver):

New Home Permits issued in February 2012:    660

New Home Permits issued in February 2011:     380

This is a 75% increase over February 2011.

(NOTE: multifamily permits  issued in February increased by 94%% from February 2011.)

• Source: The National Association of Home Builders

Denver Area Residential Resale Statistics:

Average Single Family Home Sales Statistics for February, 2012 compared to 2011:

Year           Prices                  % of Change                 Days on Market       Inventory

2012         $284,035                +3.71%                              105                      8,303

2011         $273,877                                                              117                     13,712

Average Condo Sales Statistics for February, 2012 compared to 2011:

Year             Prices                      % of Change            Days on Market         Inventory

2012             $161,848                      1.25%                          97                         2,022

2011            $159,854                                                               126                         3,995

Total Combined Homes placed under Contract in March, 2012 = 5,328 vs. 3,571 for March, 2011

Total Closed Homes in March 2012 = 3,475 vs. 3,209 for March, 2011

Note: Although prices are slightly down, the volume of sales is up, signifying improvement in the Denver market.

• Source: Metrolist, Inc.

Employment Statistics for the Denver-Aurora MSA for February, 2012:

Year                            Labor Force               Employed        Unemployed       Rate

2012                             1,394,978               1,280,523            114,455              8.2%

2011                             1,378,115               1,262,807            125,308              9.0%

Consider that as the economy improves, more people will return to the job market, so the number of unemployed may actually increase. In February, the Denver-Aurora SMSA unemployment was 8.2%

• Source: Colorado Department of Labor

Average National Mortgage Rates as of April 12, 2012

30 Year        15 Year           5/1 ARM               1 Year ARM

3.88%            3.11%               2.85%                      2.80%

There was little noticeable fluctuation in the mortgage interest rates from February, 2012.

The mortgage market continues to offer extremely low rates for qualified buyers.

All rates include a 0.6 % to 0.8% discount point. Rates quoted by any lender may not reflect momentary changes. Rates in the Denver area may be slightly higher or lower with a given lender at a given time. All rates noted in this report apply to the best qualified borrowers.

• Source: Freddie Mac National Website

*The Pulse is a review of key economic statistics that affect the Metropolitan Denver Area real estate market.  The Pulse is offered monthly as part of The Berkshire Group’s Monthly Update, and is current based on the information offered by the credited sources. The database is the 7 county Metropolitan Denver SMSA:

Tagged: Denver economic statistics, Denver housing economy, Denver real estate, Denver real estate market, economic statistics, employment statistics, national mortgage rates, statistics

The Market Pulse for April 2012 is a post from: The Berkshire Group

Days on market remains high, but will drop as the winter inventory is sold.

Inventory remains very low, with contracts written almost equaling new listings.

Homes sold jumped in March, almost equaling the tax incentive time in 2010.

Average Sold Price has started its move up much earlier than in 2011.  Good new for sellers.

Denver Real Estate Market Graphs for March, 2012 is a post from: The Berkshire Group

Denver Housing Market Update for March, 2012 is a post from: The Berkshire Group

Or, sometimes a market flips, just like the real estate market in Denver, or at least half of that market.

As noted previously in this column, the housing inventory available for purchase has declined steadily since July 2010, and is now at less than 25% of the peak periods of 2006.  Sales have remained seasonally consistent over the past 2 years, with relatively stability being the norm.  Home builders have remained on the sidelines over the past 3-4 years, either by choice or by force. Mortgage interest rates remain at historical lows, with mortgage money very available for qualified buyers. (NOTE: down payments of 3.5% are available, less for veterans)

All of those conditions have led to the lower priced half of Metro Denver’s housing market “flipping” in the past 6 months, most likely over the Christmas holidays.  How do we know?  Well, market priced homes in good to great condition are selling in 60 days or less in the under $400,000 category.  Multiple offers are flying around the REALTOR community. Buyers, used to a molasses slow market, now have that deer in the headlight look as their offers are rejected in favor of an offer accepted over asking price.

So, the bad times are over, and we are back to normal, right?  Not exactly.  While the elevator ride back up to a good real estate market is a whole lot better than the “jump off the cliff” dive we experienced in late 2008, there are still issues. The first being that the national housing market is not as good as Metro Denver’s.  There are still a large number of foreclosed properties out there, and many more will hit the market as 2012 unfolds. Second, appraisers will have difficulty in determining the value in an upwardly moving market.  Remember, appraisers look in the rear view mirror for their supporting data. So, those over the asking price contracts will be a challenge for REALTORS and appraisers alike. And, third, while improving, the world and national economy is still shaky.

Today, we are very fortunate in Metro Denver.  There is increasing construction, in both the private and public sector.  The area continues be be a very desirable place to live, with moderate weather, our mountain playground, well managed local governments, and lifestyle opportunities that embrace most anyone. Employment continues to improve, and most important, our attitude has: FLIPPED! It’s a good thing.

Flipped is a post from: The Berkshire Group