We wrapped up 2014 about a week ago, so let’s settle back and reflect on those numbers, our accomplishments, our shortfalls and try to predict and project what will happen in the upcoming year. I will try to give you some insight and not just a review. I suppose we could just say it was a relief that it was such a good year and call it good, but I think we’d be missing a couple of things that can help us moving forward.
I like the graph for this month. It is a vivid portrayal of how far we have come since the scary mortgage meltdown days at the end of 2008. It also shows us how we compare to the go-go years in the early 2000’s. “They”, whomever “They” are, said we would see a 5% decline in total sales in 2014 vs 2013. For the most part they were right (I give everyone a couple percent leeway). The Denver Metro area is down a little over 6% and Boulder is off by about 12%. Longmont was one of the best performing markets in that it is only down by 3.5%. Because I get a lot of questions on this subject, please don’t go around telling people our market is down by 3.5%. It’s NOT. It has 3.5% fewer sales compared to 2013. Price-wise, we are up.
I know you all have suffered through my publication of the monthly numbers from The Predictor. December was the first month all year where the predicted number was exactly right. Some months it was off by a little and some months by a lot (by 25 in Nov… ouch!), but for the year it was right on the money – off only by 3. The four year net total, it is only off by 5. I’d say that is a fairly accurate tool for anyone willing to pay attention.
December 2014 Longmont Area Stats
- Longmont SFR Solds down 3.5%
- Longmont ATD Solds down 0.7%
- BoCo Pains Solds down 0.8%%
- Carbon Valley Solds UP 17.7%
The monthly total or yearly accuracy isn’t the story. The story is that when I first developed The Predictor four years ago, I learned it wasn’t something that could predict a yearly total ahead of time. My first attempt was off my a couple of hundred. This year, the full-year prediction, done in January of 2014, was off by only 5! With this increase in accuracy I had to ask myself why all of the sudden it worked for a long term forecast. I hadn’t changed the formula. After pondering, updating the dates for the new year, archiving the old data and pondering some more I figured it out. It’s because this was an average year. The Predictor is built on averages and moves up and down based on average increases and decreases over time. The only way to get the result I did was to have an average year. Averages aren’t the best way to measure things, but in this case I went back to the data, averaged it in another format and it’s true, this year and last were totally average. Monthly swings higher and lower happened, but in the end we now know what average looks like.
Now, for next year. Inventory? Still holding us back from bigger numbers, but maybe average isn’t in the cards. Take a look here at this interesting segment from 9News that I have been saying for months and just happen to agree with:http://on9news.tv/1s2MHQs
I hope you all have your best year yet!