Oh la la, Mon Dieu! … What’s happening???? As the date of this writing on January 20, 2016, I am looking in disbelief at our MLS…There is only one listing available for sale in Sobo! Nothing for sale be it attached or detached except for one listing at 1820 Deer Valley Road, a house priced at $2,995,000 which sellers have been trying to sell, on and off, since 2009. I have never ever seen such a lack of listings since I became a broker in Boulder in 1995! As far as detached dwellings, 1 is pending (1585 Judson), and 2 are under contract taking backup offers (2825 LaGrange Circle and 1795 View Point Road). As far as attached dwellings, 1 is pending (1492 Greenbriar Blvd). And that’s it folks!!
What does such a drastic shortage of inventory mean?
If you are considering selling, the time to put your home on the market is NOW! The current dismal state of the stock market means that the interest rates are still low (they fell back to under 4%) and buyers are eagerly waiting for inventory. Less competition means being able to sell at top price with better terms (sellers can pick and choose from an array of offers). No inventory and high buyer demand equal strong seller’s market.
If you are wanting to buy, be ready to fight but also be ready period (this means having a recent strong pre-approval local lender letter or proof of funds on hand, being available to view properties as they come up, being able to be decisive/pull the trigger/make a (strong) offer on the spot, and having nerves of steel – this market is definitely not for the weakhearted!). Furthermore, just because a listing agent advertises that their clients will be reviewing offers on such and such a date at such and such a time doesn’t mean their sellers won’t change their minds and accept a “too good to turn down” offer with a shorter deadline than the advertised date/time to review offers. It feels really unfair when this happens, but it is and remains a Seller’s prerogative. In this market, it’s probably in sellers’ best interests to let the market play out, but it’s not unheard of for a seller to receive a crazy good all cash 20% over list price offer but being given a 20 minutes deadline to sign on the dotted line.
It helps to work with an agent who specializes in the area one is looking to buy, as a neighborhood market expert will have first-hand knowledge of properties coming on the market, whether being their own listings or a colleague’s. Case in point, I have just sold 2 properties which weren’t advertised on the MLS, but which I knew about. In both instances, I represented the buyers and sellers had their own agents to represent them, but I can honestly say that both sellers and buyers came out very happy and both transactions were a win-win for all.
Another big question is: At what rate is this market going to continue to appreciate? Well, I don’t think we are going to see a 17-20% appreciation as we have just experienced, but I believe a healthy 7-8% is still in the cards. When I look at what sold recently, I don’t see systematic 50K over list price that often anymore, but rather properties closing at full or just below list price – of course it depends on price point, but prices have risen so dramatically that selling at full price is a market correction and a healthy one. Will we see a lot more listings pop up? That’s the million-dollar question, and I wish I had a crystal ball. Sellers have to find replacement properties and must have a reason to move (lifestyle changes are the most likely indicators lately). Is Boulder becoming another San Francisco? The price gaps are still wide but the trend is definitely there… Having lived in both cities, I’ll take Boulder for its safety, quality of life, climate and small town atmosphere though we sure are growing fast!
*Not all properties were listed and/or sold by 8z Real Estate. This data is based on content supplied by REcolorado, IRES, PPAR, and/or MLSListings. Content is deemed reliable but not guaranteed. Content may not reflect all real estate activity in the market.