October 2010 Colorado Springs Market Stats

“If live seems jolly rotten, there’s something you’ve forgotten, and that’s to laugh and smile and dance and sing…”

 

"Cheer up you ol' buggah!"

 

That’s right, cue the dying whistlers, and give Eric Idle’s “Always Look on the Bright Side of Life” a spin on the old turntable. September 2010 finished with:

  • Over 9 months of inventory supply
  • A mere 603 units closed
  • Over 5500 listings for sale

This post would be objectively bankrupt to not sit back and state: those numbers, suck.

So why “purse your lips and whistle”? No, the reason is not false optimism, nor is it that the real estate industry benefited from 603 morons that bought property last month. For starters, I’m certain Warren Buffett withhold such a judgment from those 603 buyers; and if he’s not, I sure as heck am not. Surely you remember

 

The Pin-Up of Economic Optimism: Warren Buffett

 

dead-sexy Warren, “Be greedy when others are fearful, be fearful when others are greedy.” When the Oracle of Omaha is making hay on railroads, it might help to think contrarian just like him. A good deal of the reason that so many people are selling at 2003 to 2004 prices these days is because they were greedy when they should have been fearful when they bought. They bought with the intention of selling higher. Money is not made on the sale. Money is made on the buy. You can never be in charge of the market dynamics when you sell. You can be in charge of market dynamics when you buy. With fear dominating the game right now, anyone with skin to put in the game should ask the question “are the masses, right?” I for one don’t think so. The masses bought with poor intentions.

Here is the positive data:

  • Average sales price for the year is up over 4%. This is not because homes are appreciating. That is not the case at all. It is because people are stretching their money on the low interest rates to get more home. Better homes are selling. Yeah, merit!
  • Interest rates are extremely low, with 4.375 a so-so rate. I have buyers locked on a 15-year right now at 3.65%!
  • Sellers have figured out that asking too much is just plain stupid. Never in the last six years have the: avg. sold price; new avg. listing price; all-listing avg. price; been so close together. If anything indicates a market moving towards balance, it is the relationship of these three values. So despite the big slowdown in demand and the corresponding increase in months of inventory, the prevailing forces of balance still have a strong foothold.
  • Pending sales data stabilized. In fact, weirdest single piece of data this year (so far!) is that September produced more pending sales than May or July.
  • September saw 300 sellers quit the market. This is good. There have been too many sellers trying to sell for too much yet again this year. They started to disappear in 2008 and were almost absent from the market in 2009 but came back this year under the false assumption that the market had improved enough to allow speculative pricing. In fact, the opposite has occurred. This trend will likely continue through the fall, setting up the strange likelihood that months of inventory will shrink between now and December.

The rest of the story is here:

 

October 2010 Stat Pack

 

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