Low Inventory Now Slowing Sales
I was going back through the last two years of stats reports to find something I had written. I never found what I was looking for, but I did find something else. I found that the most common theme in my reports is inventory. I’m guessing y’all are tired of hearing about it. The problem here is that I found that out after I created this month’s chart on guess what…inventory. I’ll work on that in the upcoming months…promise.
In the meantime, let’s take a look at inventory today. The graph in this months report shows we are at an all-time low. What is doesn’t show is that there are only 49 single family resale homes available in town. There are also 22 new-builds, some of which are actually complete. No matter how you slice or dice the numbers, a prediction I made (but couldn’t find) is finally coming true. Low inventory is slowing down sales. The flash inventory environment we’ve been experiencing for the past two years is catching up to us. The rapid increase in price has a lot to do with this as well.
Rather than spend any more time on the lack of inventory, let’s see what it’s doing to sales across the region: Longmont single family sales are down 8.7% year over year; Longmont attached-down 32.3% YoY; Carbon Valley-down 5.2%; and the Boulder County Plains is up 6 units or 3.3%. The fact that the sales totals are down hasn’t impacted price or days on the market, which is surprising. Median and average sales prices are up in every single region year-over-year and days on market is holding steady for the most part.
Having looked at these stats for so many years now, I never imagined market conditions, as described above, coming into play. Obviously, it’s still a sellers market, but I think we’ve reached a pricing plateau for the moment. If sellers aren’t careful with their pricing this summer, you will see days on market grow and prices soften. Prices softening in this context means there won’t be as much price appreciation year-over-year. If I could control the market, this is exactly what I’d like to see it do because the 11%-23% increase in average price is just too much for a market to sustain. Sellers don’t want to hear this, but they will need to pay attention to it because anything that’s sitting on the market for 45 days or more will be assumed to be over-priced and buyers will simply offer less. It’s the same old balancing act that professional Realtors deal with in every changing market and it’s a big reason sellers hire you in the first place.
Other news. Land Title is turning 50 next year. It’s our golden anniversary and we are working now to celebrate state-wide. Look for exciting logos, throwback photos, parties and maybe even a commemorative pen. I can’t wait to see what they have in store for us and all of you who have made us the largest and best title company in the State of Colorado. Thank you for your continued reading of this report and your support of Land Title.
I hope you have fun spreading this new knowledge of the Longmont market around this upcoming year. As usual, this information will be posted on LongmontTitle.comfor convenient reference.