Friday, May 26, 2017

High End Trophies, Investment Condos, and Rare Building Opportunities [Fresh Listings, Get 'Em Hot]

Bicycles and Golden Retrievers. Short of baby goat yoga, what could be more Boulder?
There's a lot to talk about in Boulder real estate this week. The summer season is upon us and the market has kicked into high gear. Are you ready?

First, in case you missed it, check out our latest market updates. Whether you're buying or selling, investing for your portfolio or for a place for your family, deep market knowledge is the only way to make intelligent choices. Our goal is to help you make a smarter real estate decision. 

Boulder Inventory and Condo Sales Up, House Sales Fall

A Deeper Analysis of Boulder Real Estate

What's worth seeing? Almost 100 properties hit the market in Boulder County this week. We've sifted through and picked the best of the best. These are properties worth your time, yes, even this holiday weekend. If you are serious about buying, you can't afford to miss a single weekend. Drag your family with you.  

For notable sales, we discuss several houses that recently closed in Boulder and why they're important market benchmarks. At the request of our clients, for the first time, we're also going to introduce our own featured listings. 


To schedule a private showing, which includes a discussion of valuation and price trends, call Osman at 303.746.6896.




House Einstein Featured Listings

3725 Spring Valley Rd | $1.8MM | More Details 
Incredible, protected views over open space and excellent indoor and outdoor entertaining. Between Newlands and Wonderland Lake, minutes from downtown, not a winter driving challenge up a mountainous road. 






4091 Kingstown Pl | $865K | More Details 
Nicely updated kitchen, well maintained, in the highly desirable and family friendly Four Mile Creek neighborhood. South facing, functional, well designed, and under contract.









2560 Hawthorn Ave | $775K | More Details 
North/south oriented ranch with a tastefully updated kitchen and large family room addition on the back of the home. Minutes from Google and downtown. A good option for pop and remodel, or downsizing Boulderites. Excellent walk, bike, and transit scores.  




235 Fox Dr | $710K | More Details 
Turn-key, end unit town home with wonderful updates, in great condition. Rare two car garage and full basement with included workshop. CU is a 10 minute bike ride away. Easy retail options in three directions. Chancellor's residence for social trails or head up the Bear Creek path. Want the feel of a house without the upkeep and yard work? This one is for you.      



To schedule a private showing, which includes a discussion of valuation and market trends, call Osman at 303.746.6896.


Sold Listings of Note


1425 King Ave | $3.1MM | More Details 
Modern and updated throughout. A coveted spot in Boulder. On the market just five days before a buyer snapped it up at full asking. The seller gained about 38% over their 40 month holding period. From an investment perspective, the Bellevue location is an amenity due to its proximity to Chautauqua, offering some downside risk protection. For capital preservation at this point in the real estate cycle, we strongly advise choosing assets that are in prime rather than improving locations. Rather than buying a 18-24 month remodeling project, the buyer also avoided construction risk by going with a turn-key option. 


14169 Augusta Dr | $1.2MM | More Details  
We viewed and evaluated nearly every luxury house in this price range for our buyers in Boulder, Niwot, Longmont, Golden, Broomfield, and beyond. We found them a gorgeous family home right on the golf course. Beautifully finished inside with en-suite baths for every bedroom, spectacular dining and entertaining areas, and a recently refreshed exterior. It was originally listed at $1.45MM. After several price reductions, we negotiated a nearly 8% discount to the last asking. It was a pleasure to represent this savvy buyer and his family. Note: Link above is old because the listing agent failed to list it on the primary, regional MLS. It was only on the Denver MLS.



3000 24th St | $740K | More Details 
Tastefully updated, basic ranch on an average size lot. Close to the Rayback Collective and Movement Climbing Gym. East/west orientation, not in the 100 year or 500 year flood zone. This is a good comp for other basic ranches in North Central Boulder. A decent platform for a pop and remodel or downsizing option with retail within walking distance for empty nesters. It went for $10K below asking after 5 days on market. Note: north/south orientation is preferred for solar pv as well as compliance with Boulder's increasingly restrictive development rules that limit shadows on your neighbors.  


To schedule a private showing, which includes a discussion of valuation and price trends, call Osman at 303.746.6896.

Fresh Listings

Boulder 

2669 4th St | $3.49MM | More Details 
Brand new, modern and open 5 bedroom, 5 bath with Sanitas out your back door. Not much privacy with homes on either side. This is the first spec home we've seen hit the market at Trail Head. When it sells, it will be a good gauge for buyer appetite in premium locations, with high-end finishes, and modern design. If this is what you want, don't wait to go see it. There isn't much else that compares and is currently available.



805 29th St 511 | $489K | More Details 
A 3 bed, 2 bath. More dated finishes. Some mountain views. Spanish Towers have high investor and student density. With an HOA of just under $300/month and a location that brings in the kids, this might be a good CU kiddie condo or investor play. Most 3 bed attached dwellings in Boulder are priced well above this point. Offers are due by Memorial Day. 


To schedule a private showing, which includes a discussion of valuation and market trends, call Osman at 303.746.6896.




3240 Iris Ave G-209 | $300K | More Details 
2 bed, 2 bath in Remington for $300K. We already saw it yesterday, the first day it hit the market. If you can get over the run-down aesthetics at the complex, the interior of this one is in pretty good shape. The asbestos containing popcorn ceilings are still in place, so be sure to budget for that in the near future. Location is a draw for professionals and older tenants, but not as attractive for students. Garage with elevator access is a plus. The construction across the street will result in a nicer bike path, soon. As has been the case for many years, the numbers usually work for investors at Remington Post but the complex feels old and a little worn down. 


Louisville 

300 Spruce St | $1.4MM | More Details 
An elegant, updated home with solid indoor to outdoor flow. Walking distance to downtown. It's a good example of the upper threshold of what's possible when renovating in downtown Louisville. There is support for the price point.  Update: Snooze you lose, it's already under contract after just one day on market. 

To schedule a private showing, which includes a discussion of valuation and market trends, call Osman at 303.746.6896.

Longmont 

4514 Portofino Dr | $490K | More Details 
A nice house in Renaissance with tasteful updates on the main. Some road noise from Clover Basin and busy during Elementary school drop off and pick up times, but there's a bike path and open space buffer. Lots of trails and open space nearby. Oscar Blue's Cyclehops is your nearest retail option. Full disclosure: I own an investment property in Renaissance. My thesis is that it's an affordable family friendly neighborhood within easy commuting distance to Boulder, decent schools, and on north Boulder's best cycling routes.


Niwot

8780 Skyland Dr | $959K | More Details
If you need a bigger house but want to keep it under $1MM, this is a solid option. Some updates and close to Niwot Elementary and local eateries. If you haven't been to downtown Niwot lately, check it out. I highly recommend 1914 House. Niwot also has a regular summer concert series. It also has many walking paths and bike trails. 



To schedule a private showing, which includes a discussion of valuation and market trends, call Osman at 303.746.6896.


Vacant Lots and Land 

1517 Main St | $299,900 | More Details  
A large 3/4 acre lot near downtown Louisville, priced at a discount. Check for building restrictions. Also check your tolerance to being so close to the school. Lots in Louisville are rare, so better move quick. 



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As always, your referrals are deeply appreciated.
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The ideas and strategies described in this blog are the opinion of the writer and subject to business, economic, and competitive uncertainties.   We strongly recommend conducting rigorous due diligence and obtaining professional advice before buying or selling real estate.

Thursday, May 25, 2017

A Deeper Analysis of Boulder Real Estate [Market Update]

by Osman Parvez
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If you've been warming the bench on the sideline, hoping the Boulder real estate market falls apart, I've got bad news for you. 

Let's talk about market conditions. My blog post from yesterday is a good place to begin. Now, let's dig a little deeper with an analysis of inventory by price range. 

Remember: Intelligent real estate decisions are based on a deep understanding of market conditions. There is no substitute.

The first two charts below (green bars) break out stand alone, single family house inventory. I cover town homes and condos (attached dwellings) further below. 

For the detached house charts, prices start at $500K and increase in $100K tranches to $1MM. Above $1MM, buyers tend to have greater price elasticity as their range expands. Accordingly, the tranches increase by $200K, all the way up to $2MM. I included the $2MM+ tranche, but in reality, it's a catch-all for prices up to $6MM. If you're shopping in the $2MM+ range, there are a lot of options and each one needs to be analyzed individually. 


The entry level in Boulder now starts at about $600K for a basic 3 bedroom, 1 bath ranch in Boulder (click HERE for examples). Homes in compromised locations such as along Moorhead, Baseline, Table Mesa, or Foothills Parkway are below this price point, typically a 10-12% discount. 

Expect to pay $615,000 to $675,000 for a basic 1,000-1,100 SQFT ranch in average condition and on a quiet street.  Add a premium for a north/south orientation, a basement (finished or not), and larger lot size. Table Mesa and North Boulder neighborhoods sell for a premium to Park East and Martin Acres.   

What about lower priced houses? As of this writing, there are only 10 homes priced below $600K on the market. All are in compromised locations or have other material deficits. The $600K to $700K tranche is representative of Boulder's true entry-level, with a little more than 20 homes currently on market. 


To buy something more akin to modern home standards, say 2,000+ square feet on the main and 4+ bedrooms, expect to spend at least $800K (examples that sold this spring). Less and it's likely compromised in some way. 

Keep in mind there are pockets of unusual activity and higher prices. 17th and 18th street, for example, have seen a number of basic ranches that fetched an excess of $800K in bidding wars. This is driven by buyers with significant expansion plans (i.e. pops) and the general desirability of the neighborhood. You could say it's the new Newlands. 

In past real estate cycles, there was a large build-up of higher end homes available. This time around, the market looks more evenly balanced and selection actually drops above $1.6MM. 


Next, let's look at how price impacts percentage under contract. Starting with the $600K price point and moving up towards $1MM, between 45% and 58% of available inventory is under contract. From $1MM to $2MM, it drops to between 37% and 45%

This difference is not severe, but it is worth noting. It's not quite like the tale of two markets we saw in the 2006-2009 down-cycle, where high-end inventory piled up. For now, the market is far more level. Even the lowest performing tranche, the $1.0 to $1.2MM range (examples), shows 37% inventory under contract or less than 3 months of supply. 6 months of supply is what most analysts consider a healthy and balanced market. 

Now, let's switch to attached dwellings (condos and town homes). 


The entry level price point for Boulder condos is $200K to $300K. For that price, you can expect to find a 1 bedroom unit with an HOA in the $200's/month. Selection is slim with only 15 units currently on the market. Inventory in the next tranche, $300K to $400K is much better, with almost 30 units on the market.  In this price range, it's possible to get a 2 bedroom unit in a central location, with easy commuting to CU campuses or Google. Most of these units have basic finishes, deferred maintenance, and high student density.  

The biggest deficit in the spectrum of options in Boulder remains a shortage of non-student, high quality but not high-end, 2 and 3 bedroom units. Note: In the coming weeks, expect a major announcement from the Peloton with a fresh injection of supply.  

Most downsizing, young professional, and young family buyers of town homes will want to start their search north of $500K. In this price range, you can expect 2 bed, 2 baths with reasonable square footage. You can often also get a garage or storage unit for the toys. At the moment, there are only 20 units on the market. 



Cap rates have fallen back to earth and many investors have set their sites on sub-markets like Longmont and Lafayette. That's good news for Boulder buyers. You may not be competing with cash buyers, but the absorption rate remains high across the spectrum. In the $300 to $500K range, more than 70% of inventory is under contract. From $500K to $900K, the percentage ranges from 55% to 14%.  Then there's a blip for higher-end attached dwellings in the $900K to $1MM range where once again, 80% of the market is under contract. That's what happens when there are only 5 options available. The $1M+ market has just under 40% under contract

Conclusions  
The bench has been a bad place to be for the last 8 years. Prices have risen markedly and although we are in deep historic territory for bull markets, there is little evidence the market is running out of steam this summer.  It's true, inventory has begun rising. Prices have also fallen back below asking prices. Still, the absorption rate remains shockingly high, across nearly the whole spectrum.  

Now is a smart time to sell property, particularly if it's in a compromised location or has significant deferred maintenance. If you're buying, I strongly recommend focusing on lower risk assets - defined by depth of market and high liquidity. Avoid unicorns. If you're considering getting into the remodeling/expansion business, you should also have a serious conversation about your tolerance for construction cost overruns and lengthy delays. 

If you'd like to have a private conversation with me about your real estate strategy, give me a call. I work with primary home buyers and investors. My goal is to help you make a smarter real estate decision. ph: 303.746.6896. 


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Want to get blog updates via email?  Click HERE.       
Ready to buy or sell?  Schedule an appointment or call 303.746.6896. 
You can also like our Facebook page or follow us on Twitter.

As always, your referrals are deeply appreciated.  

--
The ideas and strategies described in this blog are the opinion of the writer and subject to business, economic, and competitive uncertainties.   We strongly recommend conducting rigorous due diligence and obtaining professional advice before buying or selling real estate. 

Wednesday, May 24, 2017

Boulder Inventory and Condo Sales Up, House Sales Fall [Analyze This]

by Osman Parvez
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Let's talk about market conditions. 

A couple of weeks ago, I analyzed the Boulder real estate market by comparing negotiated discounts, price per square foot, and sales volume. If you haven't read that post, click HERE. It shows a slight cooling in market activity, quarter over quarter. 

Data is available for April. Here's an update. 



Condo and town home sales show an 11.8% increase for April, year over year. House sales are down 9.2%. Monthly activity for a small market like Boulder is typically volatile, but this does continue and deepen the trend that I noted in the first quarter. 

Let's dig a little deeper. 



May is the start to the summer selling season. When you look back at inventory conditions for this month over the past several years, a clear trend is visible. Inventory for houses is up 9.4% this year. Last year, the inventory gain was 11.9%. Based on last month's sales and current inventory, the market has 4.2 months of house inventory (trailing data).



For condos, it's a different story. Inventory is up 1%, meaningless from last year, but '15 to '16 saw a more substantial 12.6% decline. Going forward, expect this to rise markedly as The Peloton begins to list and sell ~200 rental units. Right now, the market has 3.5 months of supply based on April sales volume and current inventory - still very low by historical standards. 

I've got more charts to analyze and discuss, including a detailed breakdown of availability by price range. Stay tuned for more blog posts in coming days. 

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About the data: Since the breakup of MLS data sharing, information has been a little harder to aggregate and analyze. We've re-started tracking inventory in both systems. As of this writing, IRES has almost double the data of ReColorado in Boulder County.

For the charts above, the data source is exclusively IRES to avoid duplicates. Affordable housing is excluded. Data is also for Boulder proper, which includes several locations that have not yet been annexed, and excludes Gunbarrel (i.e. Heatherwood and the Boulder Country Club neighborhoods). 



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Want to get blog updates via email?  Click HERE.       
Ready to buy or sell?  Schedule an appointment or call 303.746.6896. 
You can also like our Facebook page or follow us on Twitter.

As always, your referrals are deeply appreciated.  

--
The ideas and strategies described in this blog are the opinion of the writer and subject to business, economic, and competitive uncertainties.   We strongly recommend conducting rigorous due diligence and obtaining professional advice before buying or selling real estate. 

Saturday, May 13, 2017

Inventory Rises. Selection Improves. [Fresh Listings, Get' Em Hot]


House shopping in Boulder?

As we roll into May, inventory is clearly higher than last year (about 14% for houses) and there are signals that the market is slowing (read "Better Sell Now.") In the last few years, there has been so little inventory and so much competition, that many buyers threw caution to the wind to get a chance at buying. Guess what? Careful selection and thorough due diligence are back in style. 

This week, about 150 properties hit the market in Boulder County.  I've sifted through the inventory and picked out the very best.  If you're shopping for a home in Boulder, the ones below are worth your time to consider.  As usual, we've also included a discussion of notable sales. 

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Would You Be My Neighbor?
A Note About Due Diligence
At the end of a real estate cycle, the risk of prices falling increases and property selection becomes critical. One of the most important things you should do is meet the neighbors and make sure it's the right location for you and your family. 

Many downtown Boulder neighborhoods have high student density, notably downtown Boulder, Martin Acres, and University Hill. The student rentals very house, to house. Take a walk down the alley, where many residents leave their recycle bins, and take look inside. It can tell you a lot. Remember, the best due diligence is often free. 

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To schedule a private showing, which includes a discussion of valuation and price trends, call Osman at 303.746.6896.




Sold Listings of Note


2958 6th St | $1.75MM | More Details
A historic Newlands cottage with rustic charm, a stones throw from North Boulder Park. It traded last October for $1.64MM, off market, which highlights the risk for sellers of not going to the open market. It was snatched up the first week it was available when it returned to market. Snooze you lose.  The flipper pocketed $100K. 



2088 Riverside Ln | $1.68MM | More Details 
A large, light-filled house with tasteful updates in a quiet part of North Boulder. Large lot, plenty of bedrooms and baths, plus a three car garage. No view and not walkable to retail. This part of Boulder is characterized by large open lots, no sidewalks, and a rural feel.  It first hit the market in April and quickly went under contract, but the first buyer flaked. The second time was the charm. 



544 Main St | $1.07MM | More Details 
A couple of years ago, Louisville could barely support $1MM+ prices but today, it's a different story. Moderate size homes in good condition, with decent layouts, near historic downtown, have crossed the threshold. This one is an open and functional 2-story family home, 1 block from the best of downtown Louisville. From a valuation perspective, it sold for under $275/T.SQFT which represents a 40 to 50% discount to parts of Boulder, not even in the downtown area.  It sold for $71K over asking and in my opinion, was a bargain.


To schedule a private showing, which includes a discussion of valuation and price trends, call Osman at 303.746.6896.

Fresh Listings

Boulder 

10261 Arapahoe Rd | $2.98MM | More Details 
Talk about stunning eye candy. A beautiful farm house originally built in the 1960's and then effectively reconstructed in 2002, it featured four bedrooms and four baths across 4,500 SQFT of nicely finished space. Add in the barn, the 5 acre lot, water rights, plus the proximity to downtown Boulder, and you're looking at an estate quality piece of real estate. If I was shopping for a forever home, this would make my list, which is why I think it should be on yours.  Don't even get me started about all the garage space. Absolutely worth a look. 



835 Utica Ave | $1.19MM | More Details 
A basic four bedroom, four bath, with late 80's construction. The location is the value driver. It's west of Broadway, across from Wonderland Lake. The home has some nice updates, vaulted ceilings and solar. Lock and leave, ready for new buyers. The small lot likely precludes any expansion. Fun fact: Seller is the sister of former US senator Mark Udall. 



5271 Euclid Ave | $1.06MM | More Details 
A large, fully updated ranch with vaulted ceilings. Not much retail nearby, but close to the bike path for easy access to downtown. Large lot, radiant heat, solar, and other updates.  Ranches this large are somewhat rare. 








615 S 40th St | $625K | More Details 
Tri-level in South Boulder, right across from the rapidly improving Table Mesa shopping center. (Sweet Cow, Lucky's, The Suns). Due diligence tips: Check for road noise from Broadway. Also note that drivers often try to cut the corner at Table Mesa and barrel down this street.  



325 31st St | $610K | More Details 
Entry level Martin Acres ranch with vaulted ceilings and some quirky vintage features. Great street, very close to CU and a quick bike ride to downtown. If you're in love with mid-century modern design and want a small, very livable option, this is one to go see.  Note: the 4th bedroom might be non-conforming. This usual floor plan of this model home with the disclosed square footage usually results in three bedrooms. Check the permit history. 





600 Arapahoe Ave #3 | $550K | More Details 
Recently renovated, lock and leave 2 bed condo + study in a solid location. Due diligence: conversion to a three bedroom might be possible, check HOA and building department rules before you base your investment thesis on the conversion. 







4800 Osage Dr 34-C | $405K | More Details 
Two bedroom units in decent locations start around $400K in Boulder.  This one has the right aesthetic with exposed brick, updated kitchen and bright colors. A good alternative is Gold Run, so compare before your write your contract.  You're trading student density for potential road noise from Foothills at rush hour. 





830 20th St 204 | $285K | More Details 
These units make for good CU student condos, right across the street from campus. Interior could use a refresh. Exterior too, to be honest. The design reminds me of an old 70's era motel, but if you can get past that, it's a value play. For a little more money $300+, you can get better units in San Marco North.



To schedule a private showing, which includes a discussion of valuation and price trends, call Osman at 303.746.6896.



Lafayette

565 Wild Ridge Ln | $436K | More Details 
Newer finishes, open layout and backs to open space. Not in close proximity to retail but downtown Lafayette isn't too far away.  Two car garage. Construction from this century, which usually translates to energy efficiency and better design.  The open space factor is critical, it creates a sense of spaciousness and isolation from the neighbors. 




Longmont 

912 5th Ave | $699K | More Details 
Normally, a busy avenue isn't your best bet but this one is across from Thompson Park in Old Town. The best of Longmont is right out of your door. Home has some nice updates, it's eye popping when you compare it to what you get in Boulder at this price. A good one to see if you're betting that Longmont will continue to accelerate in value. 


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As always, your referrals are deeply appreciated.
--

The ideas and strategies described in this blog are the opinion of the writer and subject to business, economic, and competitive uncertainties.   We strongly recommend conducting rigorous due diligence and obtaining professional advice before buying or selling real estate.

Thursday, May 11, 2017

Wire Fraud and Realtor Phishing Attacks

by Osman Parvez
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You may have heard that there's a scam out there with bank wires and earnest money.  Here's how the phishing attack starts. 

Your Realtor receives an email that looks like the screenshot below. It looks like an offer on a listing. 



The link leads to a Russian site where your email account will be compromised. Later, in the middle of a deal, the buyers will get an email containing phony wiring instructions that appears to be coming from their Realtor. 

The originating email is coming through a compromised email account at Rochester Institute of Technology (RIT), used to bypass Google's filters.  

This is why if you ever receive wiring instructions from your Realtor, call them immediately. You should always obtain wiring instructions directly from the title company or bank, after calling them directly from a public phone number.  Even better, let the bank obtain wiring instructions directly from title and handle it themselves.  


Red flags: The property address isn't mentioned.  No phone number either.  And why would a real estate broker be using an RIT.edu email address? 

Note:  Phishing is a form of fraud in which a message sender attempts to trick the recipient into divulging important personal information like a password or bank account number, transferring money, or installing malicious software. Usually the sender pretends to be a representative of a legitimate organization

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Want to get blog updates via email?  Click HERE.       
Ready to buy or sell?  Schedule an appointment or call 303.746.6896. 
You can also like our Facebook page or follow us on Twitter.

As always, your referrals are deeply appreciated.  

--
The ideas and strategies described in this blog are the opinion of the writer and subject to business, economic, and competitive uncertainties.   We strongly recommend conducting rigorous due diligence and obtaining professional advice before buying or selling real estate. 

Tuesday, May 09, 2017

"Better Sell Now Before Prices Fall" - So Says the Realtor [Analyze This]

by Osman Parvez
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At my Rotary meeting today, a club member mentioned that a Realtor told him house prices are down 2% in Boulder this year.  

I almost choked on my coffee.  

"Um...what are you seeing?" he asked. 


Great question. Let's look at the data to review the past and get out the old crystal ball to talk about the future. We're overdue for a market update. 

Boulder Market Conditions
One of the problems for real estate buyers and sellers is a lack of market transparency. Public information is poor in quality and although presented nicely on websites like Zillow, it's erroneous. Zillow cares about audience size, not accuracy. That's how they make their money. The Boulder market is very small, which also leads to statistical significance errors due to sample size. 

I'm fairly certain the Realtor running around Boulder telling people that prices have fallen 2% is more interested in getting new listings than offering relevant, actionable information on market conditions. In other words, his statistics have one clear beneficiary: himself. People respond to fear. That's why click-bait exists. 

Want the facts? Take a look at the table below. This is what is really happening:



Sales volume for typical houses (see below for a description) is down 7.7% from the first quarter of last year. The sales volume drop isn't particularly meaningful. The market is still constrained by very little inventory (less than 2 months of supply, 6 months is considered normal). Meanwhile, the average sale price was $867K this year, a drop of 0.9%. Sadly, with such a small sample size and a wide range in prices (standard deviation of over $450K!), the change in average price also doesn't mean much.  


If you're looking for a better statistic to measure price changes, consider finished and total $/SQFT. This measure climbed 9.9% and 9.2%, on average, respectively. The median increased 6.3% and 8.1%. It's still far from perfect, but it's a better measure for price changes. 

Is the market slowing? Yes, there are legitimate signs of the beginning of a slow-down but average sold price is not one of them. Better measures in market performance: the % of asking obtained by sellers dropped from 101% to 98%, on average. Days on market also climbed from an average of 75.9 to 78.4 (or median of 53 to 58, if you prefer). That's still very fast, by the way, but it's definitely a signal.   

Does the slowing market impact all price ranges and locations? Of course not. Some neighborhoods, price ranges, and property types have almost no inventory and a line of buyers waiting. Ask anyone who has tried to buy an entry-level house lately.  Meanwhile, some higher-end sellers overshot and are now making big price reductions, lending the appearance of the market dropping as a whole.  

Want proof? Here's a list of Boulder homes with +$100K price cuts. Only two are under contract after slashing their prices. Note the price range and locations of the homes in that link. Let me know if you see a pattern. 

Calling the Top
My prediction is that the market will soon be nearing the end of a cycle. The industry is cyclical, after all, and this has been one of the longest expansions in modern history. The bottom was 8 years ago! 

At the same time, the Colorado job market is strong and we are now at what economists consider full employment. Strong job market, net positive immigration, and exceptionally low inventory are a recipe for stable and increasing prices - not a broad sell off. The state demographer is forecasting that Boulder County will add another 6,656 households in the next 3 years. We almost certainly won't be adding that many housing units. Where do you think all those people will live? Hint: not in the City of Boulder.  

As I've written many times, nobody has a crystal ball but I'll share my prediction: As the cycle ends, I expect most of the market will skid sideways and begin to track inflation once again. Short of a Black Swan event, only prices in weaker locations will see major price declines, and even then, it will be short lived. 

If you're buying in this market and you're concerned with short term capital preservation, I recommend choosing carefully. Focus on safe assets, not risky ones. Only pay a premium if you see yourself occupying the property for 5 years or longer. Choose real estate that is in high demand, at price points where the buyer or tenant pool is deep. Only pick locations that have a long track record of liquidity. 

What house types, price points, and locations are safe? Talk to your real state professional

If you own property in compromised locations, on busy streets or that is otherwise less than optimal, now is a good time to consider selling (there's a reason that so many houses have suddenly hit the market on Moorhead). Only sell if you have alternative investments that will perform better. It's not only the real estate market that is nearing the end of a cycle. Equity prices have reached historic levels, not through fundamentals but - as one of my friends pointed out at happy hour yesterday - via multiple expansion.  That's not a recipe for sustainability.

About the data: 
No proper analysis is complete without an understanding of the underlying data. The table above is based on the following data set. 

- City of Boulder proper, no Gunbarrel or mountains, as defined by an arbitrary map drawn by yours truly. I don't care whether it's annexed or not, neither do most buyers. 

- IRES data only, no duplicates from ReColorado. The MLS turf war is still ongoing. This means a small portion of sales data is missing.
  
- Affordable housing excluded, naturally. 

- 3 bedroom plus properties only. No unicorns.
 

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Want to get blog updates via email?  Click HERE.       
Ready to buy or sell?  Schedule an appointment or call 303.746.6896. 
You can also like our Facebook page or follow us on Twitter.

As always, your referrals are deeply appreciated.  

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The ideas and strategies described in this blog are the opinion of the writer and subject to business, economic, and competitive uncertainties.   We strongly recommend conducting rigorous due diligence and obtaining professional advice before buying or selling real estate. 

Monday, May 08, 2017

How to Protest Your Boulder Property Tax Assessment

by Osman Parvez
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Property tax assessments have arrived and many are shocked at their new home values. I even got a few phone calls over the weekend from clients looking for advice on how to protest.  

If you're a past or current client, don't hesitate to reach out to me.  I'm happy to provide appropriate comparable sales and guidance.

A few years ago, I asked the Boulder County tax assessor to present at the Boulder Real Estate Meetup.  If you have some time, this video will help you understand your tax assessment and how to best protest the value. 




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Ready to buy or sell?  Schedule an appointment or call 303.746.6896. 
You can also like our Facebook page or follow us on Twitter.

As always, your referrals are deeply appreciated.  

--
The ideas and strategies described in this blog are the opinion of the writer and subject to business, economic, and competitive uncertainties.   We strongly recommend conducting rigorous due diligence and obtaining professional advice before buying or selling real estate.