If you want to build equity in a house, buy a home in Longmont. Better yet, buy a condo or townhome in Longmont. If you would have bought either one in 2014, you would now have an equity gain of over 60%. Many people couldn’t buy seven years ago and at this time last year, they were looking at this market and saying silly words like “bubble”, “market top”, and “correction”, and they still didn’t buy in 2020. Those people missed out on an additional 6.9% average equity increase (+$31,050 on a $450k purchase). What are the non-buyers going to say next, at the end of 2021, when we have a near repeat of one of the greatest years in Longmont’s real estate history?
I will reveal my annual Y-o-Y (year over year) stats and commentary later this week. For now, let’s focus on December 2020. Remember folks, we revised 2019 numbers to include data share numbers that were not available to us last year. I will comment on the changes when necessary. The first comment is that December 2019 Longmont single-family sales went from 90 to 102 or a 13.3% change. I thought 90 was an amazing number and that told me that 2020 was going to be a good year, then covid hit and it turned out even better.
Typically, the results for December aren’t a good indicator for the next year. Low and slow is characteristic of Decembers past, but the last couple of years have broken the cold December mold. Recent, strong December sales have been a leading indicator that the following year will be strong. Low inventory doesn’t hurt either. December 2020 is no different for me. It points to a very good year in 2021… that is… if you don’t consider the December Longmont Attached Dwelling results.
If things are so good, why do we see a full block of negative numbers in the Longmont Attached market? Results like this haven’t been seen since somewhere back in 2010. Red numbers are just the outcome of math and I’d argue the December 2020 attached dwelling results for Longmont are normal. I’d further argue that the 2019 numbers are the ones that were abnormal. In December 2019 we closed out two new townhome projects that accounted for 18 sales in the mid $300’s to the low $400’s. Not only did these projects nearly double the normal December sales total, but prices were higher than normal ($377k vs $350k), and because new construction is listed well before completion, they tend to have much higher days on market (154 vs 48). For the full year, only 47 attached homes closed in 2020 versus 85 in 2019.
The Boulder County Plains area performed well in December and also had solid year-end results. This area saw average sales prices eclipse the $1 million mark twice this year. You’d kind of expect things to be a little slower, especially during a pandemic. Clearly with a 10% increase in sales volume, a 23% increase in median sales price and a 44% increase in average sales price… price is not a hinderance in this market.
My favorite market this past year- The Carbon Valley – had staggeringly good results all year long. They were awarded Market of the Year after winning Market of the Month for the first five months of 2020. Their 19.8% sales volume increase in 2020 continues to amaze and impress the experts. This market is clearly buoyed by the new construction in Barefoot Lakes, which accounted for about 330 units in their 2020 sales total. This was about a 30% increase in new homes sold through the MLS than the previous year.
New construction is a frowned upon concept in many jurisdictions, particularly in Boulder County. Without commenting on these restrictive policies, it’s clear that new construction is both needed and popular. In all likelihood it’s keeping our prices from going parabolic. Both the townhomes we talked about in Longmont and the single-family homes in the Carbon Valley have provided homes to many who wish to move here or remain here. The demand is so high in Colorado right now, we may well have already been priced out of our own market if this new construction wasn’t available.
Look for the 2019 vs 2020 year-over-year results and commentary to come out within a week. I will also review my predictions for this past year to see how close we got and make some more for next year. Send me your predictions and I will track them – if you dare. I promise to keep the names under wraps unless you are the winner, then we will celebrate you and your prediction. Make any kind of prediction you wish about the local market; you can even wait until after mine comes out.