Denver Home Prices Up 2.8%

In the 3rd quarter S&P/Case-Shiller Index Report it revealed that Denver has had the 3rd best performing real estate market in the country when compared to 19 other large metropolitan areas. Here in the Denver MSA our prices have only dropped 5.4% in the last 12 months. Many large cities have seen double digit price drops with some markets seeing drops of over 25% in the last year.

However, since March 2008, which was our lowest reading for the year, prices have INCREASED 2.8%. WOW! I bet you did not know that.

In their quarterly reports S&P/Case-Shiller breaks out their data by price ranges as well, which is very helpful. Here is what I learned--

Homes priced under $212,570--
* Prices are down 6.8% in the last year.
* Prices are up 5.4% since March 2008

Homes priced between $212,571-$317,033
* Prices are down 4.8% in the last year
* Prices are up 4.2% since March 2008

Homes priced above $317,033
* Prices are down 5.4% in the last year
* Prices are up just 1.3% since March 2008

This data tells us that lower priced homes are peforming the best in the last 6 months, the 2nd and 3rd quarter. For the highest priced homes, the market appears to be softening in the last 6 months when compared to the previous 6 months. This is probably due to the difficulty of getting a mortgage as home prices rise above $439,000 (conforming loan amount of $417,000/95% LTV).

A second good sign is that inventory levels are dropping which should help cause prices to rise. Currently, we are seeing some of our lowest inventory levels in 3 years.

It's Not A Waiter's Market

On Tuesday NAR, the National Association of Realtors released their third quarter report on real estate sales in every MSA in the country. The headline for Denver was "prices drop 11% in the last year!" Watch out the sky is falling!

Now, let's look at the facts. Yes, median prices dropped 11% from September 2007 thru September 2008. But, what's happening recently? For the 3rd quarter prices were unchanged from the 2nd quarter. And prices actually rose .7% in the 2nd quarter. That's two quarters in a row of good news!

Almost all of the 11% drop occured in the 4th quarter last year when prices dropped 9.5% in those 3 months.

Home prices are firming up in Denver and the Case-Shiller Index reveals that March 2008 was probably the bottom of the market here in Denver. It's a buyer's market, NOT a waiter's market!

Denver Market One of the 7 Best

According to Smart Money Magazine November 2008 issue they named Denver one of the 7 most promising cities for a real estate rebound in the near future. I would agree.

In the magazine they quoted the PMI Group’s quarterly risk survey which might be the best risk assessment survey in the business and here is what they said,

“According to PMI’s ‘Risk Index,’ which estimates the odds of prices falling in a given market, at least 65 percent of the nation’s 386 metro areas have less than a 10 percent chance of seeing lower prices two years from now." Denver’s risk is under 2%!

I believe there is a lot of pentup demand in Denver from homeowners who want to move up or to a new neighborhood. 2009 could be a great year for home sales in Denver.
To read the story yourself, click below

http://www.smartmoney.com/Personal-Finance/Real-Estate/Now-for-the-Good-News-on-Home-Prices/

Denver's Foreclosure Rate Keeps Dropping

According to today’s Realty Trac Report on foreclosure activity around the country, Realty Trac reported that both Colorado’s and Denver’s foreclosure activity have dropped for 2 quarters in a row! This is great news!

In the third quarter foreclosure filings of all types dropped 11% from the 2nd quarter at the state level and in Denver foreclosure filings dropped 13% in the 3rd quarter!

As of September 30th foreclosure filings in the state are down 31% from September 2007.

In Denver the percentage of household units with a foreclosure notice dropped to .91% in the 3rd quarter. The highest in the nation was Stockton, CA at 3.69%. In March, Denver’s ratio put it at the 11th worst in the country; now Denver is only 26th worst in the country. We are moving our way down this terrible list.

As the Case-Shiller Index has shown it appears that March 2008 was the bottom of the market here in Denver and this data supports this conclusion as well.

What a great time to buy a home in Colorado! I will leave with this quote from Warren Buffett last week, "A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful." Now's the time to buy.