My agency, Your Castle Real Estate, was just featured in the Denver Post Newspaper with the information below. I have added my comments in parenthesis.
The Denver metro area has been hard-hit by foreclosures, but the reality of the situation is vastly different depending on which neighborhood you live in. (This is true - each neighbhorhood can be very different!)
While numerous reports tell a bleak story of rising foreclosures and flat house prices, an analysis of data from the Multiple Listing Service by Your Castle Real Estate shows some neighborhoods are struggling while others are untouched.
The analysis drills down to the neighborhood level, giving a detailed look at foreclosures and home values.
While the data are available in some form or another to many Realtors, Your Castle's analysis, presented in an interactive map at denverpost.com, (Check this out if you haven't seen it before. It's very cool!) for the first time provides
Neighborhood View
- Explore a detailed interactive map of home prices and other data, across the Metro area.
homeowners with a deeper understanding of what is happening in their neighborhoods.
The data show that neighborhoods where the average home price is less than $250,000 are taking the worst beating, while higher-priced communities remain relatively unscathed.
Housing values metro-area-wide decreased by 1 percent in the first six months of the year; 25 percent of sales in the region were a result of foreclosures, according to Your Castle.
During the first half of the year, there were 19,460 foreclosures started in the state versus 28,435 in all of last year, according to a recent report from the Colorado Division of Housing.
Still, the data compiled by Your Castle show that the story is different from neighborhood to neighborhood.
"When you're looking at a $500,000 house, it's a near-luxury house," said Lon Welsh, Your Castle's managing broker. "It's not the person's first home, and they've got a lot of cash in the bank. They're a lot better insulated from the economy."
A separate analysis conducted earlier this year backs Welsh's point.
According to DataQuick Information Systems, sales of homes priced at more than $1 million increased 22 percent between January and June compared with the same period last year. But sales declined - in some cases drastically - in nearly every other price range, according to DataQuick.
Stapleton and the surrounding neighborhoods are among the strongest examples of variations in the metro Denver market.
At Stapleton, where the average home price is $449,000, just 2 percent of home sales in the last year were either foreclosures or short sales, and values increased 10 percent, according to Your Castle. A short sale occurs when a lender agrees to accept less money than is owed on the property.
But the 4,700-acre master- planned Stapleton community is surrounded by neighborhoods where foreclosures are rampant and values are declining, including Montbello, Northeast Park Hill, East Colfax and Northwest Aurora.
In Montbello, where the average price of a house is $148,000, 72 percent of home sales were either foreclosures or short sales. Homes in the neighborhood declined in value by about 9 percent. About 14 percent of its population lives in poverty.
In Northeast Park Hill, 58 percent of houses sold in the last year were distressed. Home values in the neighborhood, where the average sale price is $150,000, declined 11 percent. About 24 percent of its residents live in poverty, according to the 1990 census.
"A lot of it comes down to jobs and how close to the edge people are," said Charles Roberts, a broker at Your Castle. "People who bought on the low end were probably only one month away from foreclosure from the get-go. They got option (adjustable-rate mortgages) and didn't realize they were going to adjust."
The data on Your Castle's map are valuable to people who are looking to make smart investments, said Jon Terry, managing broker of Realty Professionals of America Inc. Buying in neighborhoods that have about 5 percent appreciation makes sense.
"You want to buy in an area that even during a soft market is still appreciating," he said. "What gets troublesome and, frankly, you don't want, is when it appreciates more than 20 percent. That kind of growth can't be sustained."
Because Your Castle's analysis is based on MLS data, it's more useful to real-estate agents than information found on websites such as Zillow.com, which is based on public records, said Dee Chirafisi of Kentwood City Properties.
"It doesn't take into account when renovations have been done or additions have been made," Chirafisi said. "Public records are old news. It really doesn't adjust for current trends in the neighborhoods."
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