Well, no … but the journey is starting to become a little less bumpy. More and more upbeat news is replacing the gloom and doom of the past year. And the Denver metro area continues to be near the front of the pack.
The May metro Denver sales figures reveal that the average price of single family homes increased from $254,442 to $262,066. The number of properties under contract increased 3.1%, and the number of properties closed went up 7.0% compared to April. The number of existing homes sold has increased for four months in a row. While still down substantially from last year, the month to month rises seem to indicate that we are beginning the climb up from the real estate bottom. First time homebuyers are especially driving the market in Denver, and cash investors are buying up low-priced inventory. The market is now seeing multiple offers in the lower price ranges indicating price appreciation is occurring now at the entry level prices which will translate to more sales in the spring and summer.
NBC’s Today Show ran a segment recently projecting Denver as the market with the potential for making the nation’s first comeback from the housing slump. The area is showing one of its lowest inventories of homes for sale in six years, and there has been a relative lack of overbuilding. The Denver area unemployment rate declined to 7.5 percent in April compared with 8.2 percent in March, and is much better than the national unemployment rate. Although unemployment is rising, its rate of acceleration is starting to slow.
MSNBC recently stated that “if you want to be in the right place when the recovery starts, that place may be in Colorado, Idaho, Oregon, Texas or Washington.” They believe that due to a high concentration of tech-related industries, we are well positioned to take advantage of the pent-up demand for technology. Also, we largely missed out on the housing boom and were among the last to join the recession, so as conditions begin to turn nationally, we have less of a hole to dig ourselves out of.
The Denver area fared the best among 20 U.S. cities reporting sharp drops in home prices. A home-price index for the 20 cities dropped 18.7 percent in March compared with March 2008. Denver reported a 5.5 percent decline, better than Dallas and Boston. Economists believe that this is one more sign that the economy will be on the mend moving towards positive growth by the fourth quarter.
So, we’re still on the road, but perhaps we’ve passed the unpaved portion and are about to start cruising down the smooth superhighway. At the very least, we know that real estate values will eventually rebound, and buying today will eventually take advantage of the buy low, sell high strategy.