Most of us are not unhappy to say goodbye to 2008, with its economic downturns, failing financial institutions, home price implosion, and massive job losses.  The Denver area was not immune to the sinking economy, with home prices and sales continuing to slide.

However, 2009 has begun with some rays of hope.  At the end of 2008, Denver’s home-resale market showed signs of finding its balance, with the supply of unsold homes falling sharply and homes selling a little faster.  Hopefully, last year’s 20.3 percent decrease in the inventory of unsold homes will be met by increased demand from buyers lured by lower prices and mortgage rates.  Actually, median single family home prices rose between November and December, although remaining down from December of 2007.  Financing difficulties help explain why the number of closings fell 3.9 percent last year, despite a 1.6 percent increase in the number of homes put under contract.  The recent decline in 30-year mortgage interest rates from more than 6 percent to about 5 percent should spur a slow, gradual recovery in the housing market this year, ahead of the rest of the country.

A recent quarterly report issued by PMI Mortgage Insurance Co., said the Denver-Aurora metro area ranks 10th among the cities that are expected to have stable housing prices between the third quarter of 2008 and the same quarter of 2010.  The index shows Denver bucking a national trend toward an increased risk of lower home prices, where 369 of 381 of the nation’s metropolitan areas have a rising risk of lower prices.  With the national press reporting Denver as being a low-risk area for declining values, this report could help accelerate an expected surge of real estate investments by savvy buyers looking for bargains.  The current housing market increasingly resembles the late 1980’s, when the market was beginning to recover from a hammering.  The smart investors saw the bottom of the market and began buying real estate in a big way.

And, first-time buyers are having it best of all.  A program provided by the U.S. Department of Housing and Urban Development lets first-time buyers put down just $100 on HUD-designated properties.  As a buyer’s market, with a lot of inventory, many sellers are willing to help with closing costs.  Also, first-time buyers should check out a new one-time tax credit made available last year.  In addition, the Colorado Housing and Finance Authority can provide both financing and educational tools in the first time home-buying process.

So, lets all hope that the encouraging signs at the start of 2009 indicate a turning point in the area’s economic future.  And, remember, please contact us if there is anything we can do to make your next home buying or home selling experience the best it can be!