Boulder Half Year Sales Report - 2006

Since I started publishing my regular updates on Boulder's market, I've recommended that you ignore changes to median sale price because it fluctuates wildly from month to month. With the recent news of 2nd quarter sales nationwide, it seems a good time to do a half year report on appreciation and sales volume in Boulder.

I think you'll find my analysis helps put things in perspective.

This first chart is sales volume and median sale prices for single family homes in the 1st and 2nd quarter combined (half year). To get a big picture view, I calculated 1st and 2nd quarter sales results for the past seven years (from 2000 to 2006).

In the chart below, the blue bars are 1st and 2nd quarter median sale prices for single family homes in the City of Boulder. The black line represents sales volume (the number of homes that sold).


As you can see from the chart, Boulder saw a big increase in sales volume and appreciation beginning in 2004. Sales volume declined in both 2005 and 2006, but remains well above the volume from 2000 to 2003. Meanwhile, median sale prices went from about $330,000 in 2000 to about $560,000 in 2006.

The next chart shows year over year changes in volume and appreciation levels. The gray bar is year over year change in sales volume. The green bar represents year over year change in median sale price (i.e., appreciation from the previous year).



Oh, to have bought a home in 2002!

That year saw a decline in median sale price in the 1st and 2nd quarter while volume increased slightly. As you may recall, 2002 was a bad year for our local economy. Following the Internet bubble's collapse in 2000, telecom soon followed after having laid enormous amounts of fiber in the ground and built competing communication networks (creating the so called "fiber glut").

How is this information useful?
As I've written before, a contrarian attitude can uncover tremendous value. If you purchased a Boulder home in 2002, a year when sale prices had dipped and volume was relatively flat, you would likely have enjoyed strong appreciation since that time. Yes, value can be found by moving in the opposite direction of the herd (with careful due diligence).

In the current market, many investors are downlplaying or exiting real estate. Inventory has increased in many parts of the country, including here in Boulder (to a lesser extent). Savvy buyers should recognize this as a potential buying opportunity. In some markets, depending on how long you think the downturn in real estate might last, it might be time to start looking for value.

Foreclosure listings, sellers who must sell because of life circumstances, and better selection (or even competing sellers) in certain price ranges might be buying opportunities in markets that have strong fundamental value. With our vibrant economy, incredible selection of recreation, and large and growing list of life quality awards - Boulder represents exactly that sort of community.

As always if you'd like to discuss your real estate strategy or would like additional information about our local market, feel free to contact me at 303.746.6896.

Tags:Boulder Colorado Real Estate Boulder Real Estate analysis 1st quarter 2nd quarter
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