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Recap of First Half 2008 Home Price Performance
By Lon Welsh and Terry Wenze, Your Castle Real Estate.
The average home price in Metro Denver increased +2% in the full year 2005 to the full year 2006. Comparing 2006 to 2007, the average home price across the metro dropped 3%, to $303,000. The half of 2008 was $275,000 vs. the first half of 2007 was $306,000: a 10% decrease. These numbers will be slightly different than Metrolist, as they are just Denver Metro and don't include outlying areas like Fort Collins, Colorado Springs, or Boulder.
The average price of a foreclosure dropped -6% to $168,000 in the first half of 2008. The average short sale was steady at $212,000. The average price of a non-distress sale decreased 5% to $352,000. Sales volume was down for single family homes. Foreclosure and short sale volume is up and non-distress seller volume is down.
Some areas did better than others. The attached chart shows different neighborhoods in our region. Each region has the neighborhood's name and the percentage of sales in the last twelve months that were either short sales or bank-owned properties. The second line has the price change the twelve months from July 2007 to June 2008 vs. the twelve months immediately preceding. Next, you'll see the average home price in the last twelve months and the average days on market (DOM) in the last twelve months.
There had to be at least twenty sales in the last year for an area to be included. The numbers are more reliable in areas where there were more sales.
The good news is the last four times the market had a change from a buyers market to a sellers market, or vice versa, it was preceded by a change in the DOM. DOM for homes declined in the first and second quarters of this year. Too soon to call it a trend, but it is a favorable sign. Another great indication of hitting the bottom: monthly prices in DSW and AUN have been relatively steady for seven months, after falling rapidly from 2005 to 2007.
Source: Your Castle Real Estate analysis, MLS data
Question or need more detail? Call Lon Welsh at 303 619 0633 or LonWelsh@YourCastle.org
(c) Copyright 2008 Your Castle Real Estate
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Porchlight Real Estate Group - Denver, CO
Everyone benefits from information like this. Investors, Realtors, Homeowners all need to have info like this, especially in rough times like the ones we are going through now
Nov 11, 2008 11:22 PM
Cherry Creek Properties - Denver, CO
Very interesting that some areas have a relatively high foreclosure rate (above 25%) with a positive average price change.
Nov 11, 2008 11:33 PM
Cherry Creek Properties - Lakewood, CO
It appears from the map that Aurora North, Denver Southwest, Thornton, and commerce city/montbello appear to be hardest hit. It would make sense then that these areas are the best places for an investor.
Nov 11, 2008 11:35 PM
Your Castle Real Estate - Castle Pines North, CO
My guess is that all of the areas that are red also have relatively low Days on Market. At least for the houses that are owned by the banks.
Nov 11, 2008 11:42 PM
Your Castle Real Estate - Denver, CO
This map definitely confirms everything we are seeing out there on the market. Another observation is that the red areas are "red" hot with investor activity. This map is obviously updated quarterly, I just hope that I can keep ahead of the curve when the red areas turn to orange, and orange to yellow, and yellow to green. That seems to be where you will make money as an investor.
Nov 11, 2008 11:48 PM
Your Castle Real Estate - Aurora, CO
With all of the neighborhoods that have homes over 800k it seems that they are still doing relatively well. I would like to ask all of the Active Rain community what they think of that? My guess is that the number of sales is what is going down.
Nov 11, 2008 11:53 PM
Your Castle Real Estate - Parker, CO
I saw an article in the paper about how many of owner occupants are having a really hard time competing with investors. It seems that even though prices are still declining, the listing brokers for banks are creating bidding situations.
Nov 11, 2008 11:58 PM
Your Castle Real Estate - Highlands Ranch, CO
Everyone benefits from information like this. Investors, Realtors, Homeowners all need to have info like this, especially in rough times like the ones we are going through now.
Nov 12, 2008 12:04 AM
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