Welcome to July everyone. My how time flies. And, Oh my, how real estate is flying as well. There are plenty of story lines this month, so hang tight and see if there is anything in here you can use in your business.
When you were a kid, do you remember that time when you really felt like you might actually be growing up? My moment was when I accidentally took out my dad when we were playing hoops in the driveway. I was 15 and I crushed him into the wall when he tried to drive the lane on me. More recently, my 15 year old son Pete out drove me on the golf course – by 45 yards! Well, I think the Carbon Valley (Firestone, Frederick and Dacono) just hip checked their big brother (Longmont) in the boards. Take a look at the Median Sales Price in Longmont vs the Carbon Valley and you will see what I mean. In honor of this big moment, I created a chart from the past 3½ years to show the Average Price trends of Longmont and the Carbon Valley. That “East of the highway” area isn’t just the kid brother that can be dismissed, or where someone defaults to when they think they can’t afford Boulder County. They’re now a solid competitive player player in this market.
The housing stock is increasing with new projects in Longmont and in SW Weld County. Next to come is commercial and retail construction to support the families that move in. These additional services will attract even more buyers to the area. The end result is a longer rally in our market than many had initially anticipated. Even with a bump in interest rates starting to kick in, there is obviously no immediate slowdown. Nearer the end of the year, I predict slower price appreciation, which would be a good thing, but transactions will continue at a good pace with slightly longer days on market.
Back to the graph for a moment. I find it interesting, that each spike in Carbon Valley average sales price corresponds with a dip in the average price in Longmont. I’m guessing here, only because it would be hard to prove, but this looks like a good example of what I have talked about in the past… When prices go up in one area, buyers gravitate toward lower prices in another. Sure, inventory plays a role in this too, but the direct correlation in amazing to me. The number of sales in the Carbon Valley this past month is particularly astounding since it’s double their normal monthly total…and darn near equal to that of Longmont.
- Longmont = Carbon Valley in Median Price
- BoCo Plains Median & Avg Price UP $75,000
- Longmont ATD UP 36.5% YTD
- Carbon Valley Closings UP 87.5% vs 2014!
The Boulder County Plains and Longmont Attached units are no slouches in this market as well. The Average Price of a condo in Longmont has climbed to where a single family home in the Carbon Valley was just 18 months ago. The Plains area is showing about a $75,000 gain in both Median and Average Sales Price since this time last year. The question I am beginning to hear is: “How high can these prices go”? A bad answer is: “Look at Boulder”. We are a looooong way from that due to a number of reasons. That’s good, but what about the downside? The lending changes that went into effect over the past 8 years have somewhat protected us from a significant down turn. These prices are here to stay because we have more foundational stability that didn’t exist back then, preventing the pervasive foreclosures and significant price drops in the future. Jobs, interest rates, the economy, over construction, government policy and lending practices will all have a hand in deciding our future.
As for the nice rise in inventory you see in the charts, there is a bit of a fudge factor built-in, making them look a bit too rosy. Forty four Active Listings in Longmont are new construction or haven’t even been built. If you take out all the Pending, Under Contract, Under Construction and to be built listings there are only 85 Active SFR Listings in Longmont. For the time being, we are in the same place we’ve been for the past year and a half. So, start your second half of the year off on the right foot and spend some time with the people in your database. That’s where the money is. It’s always been that way and it always will. There is no magic pill out there for success. This is a relationship business, so go solidify those you have, make some new ones and go get your piece of the pie.
I will end with a couple of numbers you’ve never seen. I recently did research for LAR and a company providing the City of Longmont with data to help in their decision making. I won’t drop all that info on you, but here are a couple things for you to think on. Since January 1, 2000 until December 31, 2014 the total sales volume of sold homes, condos, and other attached units in Longmont is: $5,629,669,030. That’s 5.6 BILLION dollars worth of real estate that changed hands in this town in the past 15 years. Amazing, isn’t it? And since you were going to ask anyway, that was in 22,957 transactions.
I hope y’all had a Happy 4th!