Time for a quick look at inventory in Boulder and Louisville.
First a couple of details. I'll explain why these distinctions are important in a moment.
Available inventory = all property not under contract + property with a first right of refusal. The vast majority of first right properties will not sell to the party who retains that right of purchase, so I'm treating it as available (and so should you).
Under contract = property that is under contract with a buyer (i.e. listed as active/backup) + pending status listings. Pending usually means the property is about to change status, from either active -> under contract or (less commonly) under contract -> sold.
One of the reasons I started this blog was to better educate my clients on market conditions. Clients, of course, come first which is why my blogging has slowed. If you're a client (or prospective client), call or email me directly with your questions about market conditions. Don't wait for me to blog about it...
There are currently 318 houses on the market in the City of Boulder. 179 are available for purchase (i.e. not under contract or pending).
305 condos and town homes are on the market in Boulder as of this writing. 146 of these properties are available for purchase (not under contract).
In Louisville, only 81 houses are listed for sale. Just 31 of these listings are not under contract or pending (38%). Not much selection, sorry Louisville home buyers. Better get yourself a good buyer's agent.
By the way, this is one of the reasons you can't trust an computerized estimate of your home's value. There is far too little inventory (or sales) for Zillow/Trulia/Redfin's estimate of value to be remotely accurate.
Always Question Assumptions
Story time. This is for the Realtors who read this blog (shout out to my colleagues and competitors).
I was crunching data for the monthly House Einstein report and noticed an alarming trend. Inventory in every market appeared to fall off a cliff in May. How was it possible that inventory would suddenly drop 26% to 59% in Boulder, Lafayette, Longmont, Louisvile, Erie, and Superior? And yet when I checked current (June) inventory, it appeared to have rebounded.
If you're a regular reader or a client, you know that I draw data from a variety of sources including the Boulder Realtor Association (BARA). BARA, in turn pulls data from the MLS and other sources to compile its monthly data reports. The error appears to be in BARA's data and I suspect the direct cause was a change at IRESIS (the MLS, for you non Boulder Realtors).
Here's the email I whipped off a few minutes ago.
Ken and J,
I started working on my monthly report and I noticed a strange trend in the May data. Inventory across our metro markets dropped massively in May. I started digging further and when I checked current inventory, it appears to have rebounded.
This is what I think happened.
The process for looking up inventory in IRES has changed. Previously, when you searched under "active" it automatically included "active/backup". If you wanted to exclude "active/backup", that was a choice you had to make separately. Now in order to include property that is under contract, you have to actively select both "active" and "active/backup" to get the full inventory.
I'm pretty sure that the MAY data needs to be corrected, at least as far as inventory is concerned. It appears to be missing active/backup listings.
Could you confirm? Thanks!
In short, don't trust any data or analysis unless you understand the methodology. And right now, I don't trust the data coming from BARA without independent verification. I'm also shocked that the data was released weeks ago but the error persists. Did anyone else notice?
Another Data Issue with BARA
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