It’s no secret that 2009 has been a pretty miserable year for the economy in general and real estate in particular. We’re hopeful that the glimmers of hope that we have begun to see will continue so that 2010 begins as a year of recovery and ends as a year of growth.
Last month marked the best October since at least 1990 for sales contracts in the Denver metro area, with 4,910 homes placed under contract, a 9 percent increase from October 2008. One reason October sales were stronger than a year ago is because the impact of the recession was starting to hit home last year. The average price of all homes sold was $261,771, in increase of 4.6 percent from October 2008. Additionally, the number of unsold homes on the market last month marked the lowest inventory for an October since at least 2001. Also, activity was strong, with the weekly sales rate the highest since 2001 as well. With fewer homes on the market and buying activity strong, it’s a reasonable expectation for continued improvement next year.
Recently, MSN real estate named Denver as one of ten cities where real estate prices are rebounding, declaring that the city avoided the real estate bubble that hit the east and west coast states. Other encouraging signs include the latest report that the Colorado unemployment rate for October fell to 6.9 percent, falling from 7 percent in September, 7.3 percent in August and 7.8 percent in July.
Adding to the potential for a continued upswing in real estate, the tax credit for first time home buyers has been extended, and it has additionally been expanded to include people typically in the move-up market. In addition to the tax credit of up to $8,000 for first-time buyers, the new plan expands the program to include a $6,500 tax credit for those who have lived in their home for at least five of the past eight years and are buying another home. This targets move-up buyers as well as new purchasers, so people who already own homes will feel comfortable enough to sell their home and buy another one. The legislation also increases the income eligibility limits for the tax credit from $75,000 to $125,000 for individuals and from $150,000 to $225,000 for joint filers. The cost of the home cannot exceed $800,000 and must be under contract by April 30, 2010 and closed by June 30, 2010.
With the Denver area faring better than most of the rest of the nation, it’s nice to be on the forefront of the hoped-for upswing and the potential explosion of the pent-up demand for real estate. Now is looking like a great time to buy or sell – let the Arnie Stein team work for you and with you to meet all of your real estate needs.