Locally, the big news is that price reductions are up, indicating that seller’s are no longer commanding the market so extremely. Nationally, interest rates are up significantly, vacation homes are down, price drops are up.
Local Market Update – Boulder County
Our Boulder realtor team reports that 107 new listings came to market last week, vs 124 in 2018, 135 in 2019, 67 in 2020, and 127 in 2021.
Boulder real estate agents had 93 properties go under contract, in contrast with 114 in 2018, 116 in 2019, 51 in 2020, and 107 in 2021.
We had 1.51 months’ supply of inventory, in comparison with 2018’s 1.97, 2019’s 2.55, 2020’s 1.16, and 2021’s 1.59 MSI.
Year-to-date under-contracts last week were at 900, in comparison with 1098 in 2018, 1155 in 2019, 1050 in 2020, and 1133 in 2021, so approximately 200-250 under-contracts low for this time of year (outside of the 2020 pandemic year).
This smaller number of under-contracts is directly linked to low supply of inventory; there is lots of buyer demand, as documented by Core Logic’s recent reporting of 2.2% appreciation in February 2022 alone.
Let’s look at inventory from one more perspective.
What is our total single family home inventory?
Activity By Price Band – Boulder County
From a price band perspective, the $2-2.5mm market was super active for the last two weeks. Boulder realtors saw a fair amount of quiet, likely due to spring break, in a number of other price bands.
SUPER IMPORTANT: To note, last week and the week before, we saw an enormous uptick in price changes (which 99% of the time means price reductions). Check out the graph here. After almost no price changes for months, sellers have dropped price in every category. This is a leading indicator of a lessening of seller power in the market.
Surging Mortgage Rates and Home Prices Sideline Buyers
According to Boulder County realtors, the market still feels hot because housing supply remains near record lows, but there is a slowdown in online searches, home tours and mortgage applications, which are all leading indicators suggesting that some buyers are getting priced out. Still, our Burgess | Compass Boulder realtor group indicates that the market continues to feel very hot, with homes selling faster and for more money than ever before.
A fast-growing share of home-sellers are dropping their prices, another sign that the early 2022 housing frenzy is starting to ease as mortgage rates approach and pass 5% and inventory loosens. Twelve percent of homes for sale had a price drop during the four weeks ending April 3, up from 9% a year earlier and the highest share since early December. The rate of sellers dropping their prices is growing faster month over month than it has since August.
Pandemic-Driven Second-Home Boom Is Coming to an End
Demand for vacation homes dropped sharply for the second month in a row in March, with mortgage-rate locks for second homes at their lowest level since May 2020.
Demand for vacation homes was still up 13% from pre-pandemic levels, but it’s declining after a pandemic-fueled second-home boom last year. We expect demand for second homes to remain above pre-pandemic levels in the future, as remote work is here to stay for many Americans.
The slowdown in demand for vacation homes joins other early signals that the historically fast rise in mortgage rates and record-high home prices are pricing out some buyers.
Boulder Farmers Market
April 2 – November 19
Rated the No. 1 farmers market in the country! You can sample, shop, meet local farmers, smell the flowers, hear live music, sit by the creek and eat great food.
The annual awakening of the tulips, where little ones dress up like fairies and elves. Participate in scavenger hunts, arts and crafts, face painting, and parades while enjoying the 15,000 tulips along Pearl Street Mall.