Tag Archives: Broadmoor

Greenshoots 2013: S/W District 12

Possibly the hardest market to report on in all of Colorado Springs is the Cheyenne Mountain District 12 portion of the S/W MLS area. This is where our obsessive compulsive behavior and perfectionist streak takes a beating with intellectual, geographic and physical realities (my back and neck are hitting the chiropractor after several grueling hours in front of the computer running these!). While we only divided District 2 into three different neighborhoods, we almost had to divide District 12 into 13 different unique neighborhoods. No other part of Colorado Springs has such a disparate range of values, dollar per square associations, types of homes and types of land. There are sprawling estates back on Marland, 1100 square foot funky treehouses on Mid, 1960’s split levels on Rigel and gated mansions. Despite all of our micro-marketing, we’re still excluding places like Forest Oaks and Stratton Forest because we did not feel equipped to pull information on them due to the lower number of sales for comparative value.

It should also be pointed out that this did not touch on the sliver of properties that are in School District 11 on the north side of the area. Nor did we touch on any of the townhomes, patio homes or condos, or the Broadmoor Brownstones in our search, since all the others are exclusively a single-family driven analysis. So even in our efforts to be precise and use comparables as an appraiser might, we have more than a few holes for this area.

Click on any slide for more detail.

Broadmoor (around the hotel). These are the famous estates, and home to five of the 32 $1million+ sales in the MLS in 2012.

Broadmoor Buying Patterns Broadmoor Neighborhood Patterns Broadmoor Scattergram Broadmoor Time to Sell

Broadmoor West/ Broadmoor Heights (“behind” the hotel, and up Old Stage and by the zoo). These are large lots usually in the treed foothills.

West of Broadmoor Buying Patterns West of Broadmoor Neighborhood Patterns West of Broadmoor Scattergram West of Broadmoor Time to Sell

Old Broadmoor and Alsace (east of the hotel, boundaried by 7th on the west. South Valley excluded). This is a wildly disparate area with tiny lots, big lots, little houses, cottages, converted farmhouses and 1970’s split levels.

Old Broadmoor Buying Patterns Old Broadmoor Neighborhod Patterns Old Broadmoor Scattergram Old Broadmoor Time to Sell

Broadmoor Valley (around Gates). Sandwiched between two golf courses, this has some of the more appealing and unique views in the city, with rolling terrain provided by the foothills and the sentinel of Cheyenne Mountain in the distance, and then long distance views to the north of city lights.

Broadmoor Valley Buying Patterns Broadmoor Valley Neighborhood Patterns Broadmoor Valley Scattergram Broadmoor Valley time to Sell

Springdowns and Clubheights. On the mesa around Cheyenne Mountain Boulevard are some of the more surprisingly large lots in the city. Slightly midwestern in design, this is a pocket neighborhood where good homes will often sell quite quickly.

Springdowns and Clubheights Buying Patterns Springdowns and Clubheights Neighborhood Patterns Springdowns and Clubheights time to Sell Spriongdowns and Clubheights Scattergram

Top of Skyway and Skyway Heights Two different MLS areas, both of them running up hill to Gold Camp Road and looking straight back at the center of the city.

Top of skyway Buying Patterns Top of skyway Neighborhood Patterns Top of skyway Scattergram Top of Skyway Time to Sell

Skyway We use this term to define properties below Pegasus and Andromeda and then running alongside 21st/Cresta. Generally 1960’s and 1970’s homes in the foothills.

Skyway Buying Patterns Skyway Neighborhood Patterns Skyway Scattergram Skyway Time to Sell

Lower Skyway Lower Skyway is distinguished from “Skyway” by being on the east side of Cresta and rolling downhill from there to 8th Street. Generally we took the area from Parkview south. 

Lower Skyway Buying Patterns Lower Skyway Neighborhood Patterns Lower Skyway Scattergram Lower Skyway Time to Sell

Ivywild and Cheyenne Canyon (we couldn’t really separate the two due to overlapping comparables and found that their patterns and values were surprisingly similar). Perhaps only Manitou Springs is more eclectic in it’s architecture and variety of pricing. Strangest fact we’ve seen of any MLS area: the average price of this area was lower than year’s past at $216,000 and there were zero sales from $300,000 to $418,000 in this area last year; yet there were another six sales over $418,000.

Cheyenne Canyon & Ivywild Time to Sell Cheyenne Canyon & Ivywild Buying Patterns Cheyenne Canyon & Ivywild Neighborhood Patterns Cheyenne Canyon & Ivywild Scattergram

Broadmoor Glen A newer construction neighborhood by D12 standards to the west of Highway 115 at the base of Cheyenne Mountain. Characterized by all the roads’ names ending in “Glen”. 

Broadmoor Glen Buying Patterns Broadmoor Glen Neighborhood Patterns Broadmoor Glen Scattergram Broadmoor Glen Time to Sell

Broadmoor Bluffs including Star Ranch aka “Cheyenne Mountain” this is the middle of the mountain so to speak, stretching between Broadmoor Glen and the Broadmoor Resort Resident’s Gate, but to the north of Stonecliff.

Broadmoor Bluffs Buying Patterns Broadmoor Bluffs Neighborhood Patterns Broadmoor Bluffs Scattergram Broadmoor Bluffs Time to Sell

Stonecliff (the far southern end of Broadmoor Bluffs mostly composed of post 2000 construction). This is all the way up around NORAD, in the towering trees, boulders and cliffs of Cheyenne Mountain.

Stonecliff Buying Patterns Stonecliff Neighborhood Patterns] Stonecliff Scattergram Stonecliff Time to Sell

Broadmoor Resort (The “BRC”, exclusively inside the gate). The Exclusive gated neighborhood below Cheyenne Mountain Zoo with large estate homes on treed acreage, usually featuring jaw-dropping views.

Broadmoor Resort Buying Patterns Broadmoor Resort Neighborhood Patterns Broadmoor Resort Time to Sell Broadmoor Scattergram

 


Some MLS Marketwide baselines… Probability of sale last year for the entire MLS was 63.8%. That was the highest probability since 2005. These graphs sometimes reflect mostly lower numbers, but that is because the software counts under contract properties as still “active”. In essence, these are contracts, and in certain cases, we notated what happens to months of inventory and probability of sale if you “count the contracts” that are there at the start of the year. Saying that, for the most part, Northgate inventories are low carrying over into 2013, but there are not a lot of under contracts in these neighorhoods outside of Flying Horse.

If you would like any of these slides emailed to you for specific information, hit me up at Benjamin@BenjaminDay.com. Yes, we realize that they read a little small, but we’re preciously attached to our WordPress format, so, sorry.

The software used to create these graphs is from http://www.Focus1st.com and we used a date range of January 1, 2012 to January 11/14, 2013 for all of the searches, doing as many as possible on two different business days to get a competitive comparison for a single snapshot in time.

Disclaimer time: Benjamin Day composed this blog post and is solely responsible for it’s content. This information reflects data and opinion of real estate licensee in The State of Colorado. Based on information from the Pikes Peak REALTOR Services Corp. (“RSC”), for the period January 1, 2012 through January 14, 2013 . RSC does not guarantee or is in any way responsible for its accuracy. Data maintained by RSC may not reflect all real estate activity in the market.

Mid-Year Review: July 2011 Market Stats

Click Here for Mid-Year Review Market Report

The Summer Viewing at Pikes Peak Urban Living is on the cat fight between two market metrics: Average Sales Price and Months of Inventory.

Months of Inventory is a handy-dandy metric to forecast, predict or… guess… what the market will do next. The barometer that has traditionally held sway is a 6 month supply of housing equals a neutral market. Get below six months and stay there and the market should see appreciation and increased seller-control. Go above six months, and that much to choose from sways control to buyers and prices drop. The majority of the last four years have been in excess of 6 months with a few brief months in 2009 under 6 months supply. July 1 showed a reading of 5.5 months. After three previous months from 5.9 to 6.1 months of inventory, that should be a predictor of prices going up.

Yet they haven’t done that.

Average price year to date is off 4% from a year ago. A lot of this was the post-tax-credit malaise that wrecked the market last spring. REALTORS went from running their engines at 110% in April to idling them in May, and never really getting them out of neutral the rest of the year. This year has been somewhat spastic, but overall, prices are steady to down then they’re showing appreciation.

Most everyone has an easier time understanding what has happened as opposed to grasping at what might happen, and correspondingly average price gets a lot of press. But as I spoke about last week, the relationship between units for sale and units sold is pointing to possible to likely improvements. The market has crested in inventory and is in the six to seven month cycle of fewer, not greater listings. There will be new listings each month, but not at the rate that they were before, and many good new listings will be recognized more readily as valuable by active buyers because buyers operating in the second half of summer and early fall generally have to make quick decisions. These are general conditions that don’t always hold, but with fewer than 4800 listings for sale, and two more months under 6 month’s supply likely… it will be interesting to see what happens to pricing over the next six months.

To see the active market numbers, Click Here for the Stat Pack.

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

 

After the Tax Credit. What now?

The first listing I sold was 1620 N. Nevada in March, 2000. After pricing the house at $325,000, I looked up the public record to see what the seller paid for it back in 1989: $88,000. 370% appreciation in 11 years!

A present downtown listing

Was that lovely 1898 Victorian Grand House shiny and new in 2000? Or was the value of that property something established by something fundamental? Examples: there are photos of it in the Pioneer’s Museum; Old North End dirt has been considered valuable for 125 years. Why is that house now today probably worth $500,000? Hint: it has nothing to do with the kitchen counters!

I predicted that the market would hit 9200 sales this year. That is exactly the pace the market is on. But I no longer think the market will hit that number. Statistically, fewer homes sold the first four months of 2010 then in 2008. Anyone care to remember the real estate bliss of 2008? I had a moderately bullish forecast in January due to supply and demand trends that no longer exist. The market is better now than it was in 2008 or 2009: but those were lousy years. Comparative analysis requires thoughtful honesty. If the market was actually “improved”, the market would have less than 6 months inventory right now which would catalyze summertime appreciation. It is at 6.5 months despite a massive 1500+ under contract properties. With the 31% increase in listings year to date, it might not get below 6 months this year . More at The Stat Pack.

I financially benefited from the tax credit. This has personally been one of my most successful years in the business. Yet it has also been the most puzzling. 1.) A great number of the listings that soared onto the market this spring were trying to capitalize (too late) on the move-up tax credit. Will these people stay on the market without a $6500 government incentive? 2.) Shiny and new is always popular, but it is also always depreciating. Why oh why is there a 15 month supply of housing of pre-1950 housing $200,000 and up downtown, while there is only a 5.5 month supply of housing of 1998 or newer over $200,000 in Powers? Yes, there are more buyers for properties in PWR than CEN, but we’re comparing 77 active listings downtown to 275 in PWR, and still there is 1/3rd the months of inventory out east? Consumers are habituated to buying disposable things, like a flat screen TV, a Starbucks, or a car with a loan. This behavior seems to be alive in real estate purchasing. I am guessing that the “sale” aspect of the tax credit encouraged it.

The real value of buying in 2010 is to leverage REMARKABLE. Prices went down for 3 years. Buying power is  25% better than it was in 2007 when you account for pricing drops and money leverage. This opens up a lot of 1620 N. Nevada scenarios for a lot of people.

Location is the first and greatest real estate fundamental. Prime location areas have not sold well year to date. It’s not just Broadmoor and upper Peregrine, but downtown, Manitou, Old Colorado City and places where the value is in the dirt.

If you are choosing to sell or buy, qualify your “WHY.” Why are you doing this?  If you are selling and can seize other opportunities, then get it over with. If you are buying, what’s the most remarkable area you can afford?

Real estate isn’t fair; never is, never was. Removing the carrot from before the horse helps consumers more honestly assess their wants and needs.

Colorado Springs Real Estate Market Data March 2010

The Stat Pack is sizzling hot HERE.

Silver Bullets are good for killing werewolves. Not much else.

Save your silver bullets for John Landis movies...

Ask anyone in the real estate industry and they have a buyer who is sending them scared-stiff links that “prove” the real estate recovery is not happening like everyone says it is. Some gloomy desk-jockey-number-cruncher is usually quoted with a gloom and doom rubric “5 million more foreclosures” and “21% of American’s underwater” and “it’s now moving to prime mortgages.” The agent response to this phone call or email is usually just as incendiary… they sometimes reply with back issues of the Stat Pack as an attachment. Clashing gospels and dueling clanging gongs creates quite a racket.
The reality is that the economy is a giant gumbo of variables. Within 36 hours this week, all of the following were headlines: Colorado Jobs numbers much worse than expected; National Jobs numbers beat predictions; stock market near 18 month high; mortgage rates expected to rise as Treasuries stops buying servicing; mortgage rates at low for the calendar year; auto sales down 2%; retails sales unexpectedly up; nation’s consumer confidence goes down. Broncos have had a good week for free agents and the Rockies bench is looking pretty deep this year, too. All of these are true. None of these mean a thing on their own.
WHAT MATTERS NOW:
1.) Leverage: The most counter-intuitive aspect of the market, interest rates are staying below 5%. No analyst can say exactly why, everyone merely ventures a best guess. Most everyone is scratching their heads as to why they’re not going up. The Federal Government has been the wholesale market for treasury-backed securities, longhand for saying, they’ve bought the servicing rights on Fannie/Freddie mortgages for the better part of the last year. So if you’ve seen complaints about why the underwriting on mortgages got nutty, that’s a prominent clue as to why: the government put a trillion dollars of skin in the game on that one… Go figure they would prefer tighter appraisals. That treasury-backed securities practice has a budget that is probably out of gas around the first-of-April. After that… it’s back to the same private money that previously was buying servicing left-and-right up until mid-2008 when they saw the crisis about to break. The thinking on the street is that private money will be hesitant (to put it mildly) to buy servicing rights. Never mind that today’s mortgage has higher costs of origination, higher appraisal standards, higher consumer intelligence and 20 pages of additional disclosures attached to it making it one of the safest and best documented forms of paper wealth in America; these banks have been burned before and are expected to be either cautious or complete non-participants. The investment angle for banks is that they 1.) could make them a lot of money in the long-term based on the few players likely to play and 2.) make their shareholders jittery over the next 90 days and drive their stock value down in the short-term. Can you see the morass mortgages are? The bottomline: they’re low now! They may be going up, but they’ve rarely, in their American history, been lower (within 0.15% of the all-time bottom at this writing). Seasonal demand usually creeps them up in May and June anyhow, so a lock now is not a bad thing. Buying power right now (a.k.a. leverage) is almost unprecedented.
2.) Location: Where a home is greatly influences the value. Relocating buyers (#3 on this list) tend to prefer newer construction and so do the raised on Hi-Def & Wi-Fi generation of buyers. But values have held up well in the foothills. Year to date sales in some of the older areas have been abysmal. After a strong end to 2009, downtown has started off very weak. That might change as the more traditional downtown buyer begins to appear with the pedestrian-friendly, warmer months ahead. The months on market numbers vary wildly from neighborhood to neighborhood. Sellers, you can’t take chances if you have a year of inventory. No one’s going to pay near your price if that’s the case. Buyers… do you really want to buy where you’ll be surrounded by for-sale signs for another year?
3.) Relocation: the biggest drag on the Colorado Springs market has been the national market. Somewhere Else, USA used to be the friend of the Colorado Springs seller. The Pentagon-based Air Force Lt. Col. usually had made $100,000 in 3 years and sold their house with multiple offers. They could come west and buy pretty much whatever they wanted. With the onset of the market downturn nationwide in 2007, our market correction (which began in early 2006) deepened significantly. Reliant on the infusion of wealth from other markets, our over $350,000 market has suffered. Well strangely, of the 5 price-brackets to seen an increase in sales the last 90 days over the previous 90-day track (Nov. to Jan.), all of them were above $325,000. Some of that is local, but some of that is also the effect of other markets around the country having bottomed out as well, and their buyers are now able to buy here.
In closing, March 2010 dawns with more promise and hope then March, 2009. Hard not to. It remains a market of opportunity. Whenever there is opportunity, that means there is risk somewhere. Make your decisions wisely.

Where to Buy 2010 Part VI: Red Lights

The post that makes enemies faster than friends. In the interest of covering my own fanny, this is analysis based off of data that measures multiple metrics and then draws conclusions when comparing one set of data to another set. It is a formula set designed to assist buyers with purchasing decisions where their home-ownership may be less than 3 years. If that’s the case, The Red Light Properties have supply and demand trends that look like they will continue to put negative pressure on value. If you simply “must have this neighborhood”, or “must have this home”, or you plan on this being your last home purchase and you don’t care if it loses value or not… this post will mean nothing to you. This is a cold, calculated presentation of data as to whether or not these areas will appreciate (or depreciate further) in 2010. My forecast is that the average sales price all of these areas will continue to lose value next year.

To read about the Goal of This Where-to-Buy Series of Posts, Click Here.

To find out the recommended areas that have probably swung past the bottom of the pendulum and are already appreciating, read about The Green Lights. To see the Data for the Green Light Neighborhoods, that is found HERE.

For the bigger risk takers (but probably where the timing favors a turn to appreciation in later 2010), The Yellow Light areas are documented HERE. Note: I accidentally omitted Gleneagle in that post, which has stabilized pretty significantly in the last 18 months and will probably be in appreciation-mode by 3rd quarter, 2010. Up-to-Date Market Data is found here at THE STAT PACK link of www.BenjaminDay.com.

RED LIGHTS

The Red Lights for the most part represent neighborhoods where the average selling price is over $400,000. In some cases, even in the boom years of 2004 through early 2006, it was more probable that a home would fail to sell than actually sell in a ultra-high-end neighborhood like Kissing Camels or Broadmoor Resort. But the impact of the Great Recession, consumer pessimism, tightened underwriting and Jumbo Loan Regulations starting on any loan over $417,000, and the investor-fueled 1.5% to 3.0% penalty in interest-rate since September, 2007 has had a huge effect on the higher end. These are the same factors that have driven down the average sales price in Colorado Springs from over $270,000 in July, 2007 to $213,000 today: there is not only less demand for a high-end home, it’s just plain hard to buy one.

A Few Good Buys, but New and Expensive will Sit Forever:

Jackson Creek, Stone Crossing/Middle Creek, Erindale/Pulpit Rock and Sunset Mesa/Saddlerock all have average on-the-market values considerably higher than the year to date average sales price. All four have had less than a 47% probability of sale each of the last two years. All four have an average year-to-date sales price that is less than the six -year average. Of the four, Stone Crossing has withstood price pressure the most, only off a couple hundred dollars from the six year average. But the average sales price is only $20,000 higher than the year-to-date sales price and with 15 year-to-date sales and 18 on the market (15 months of inventory), the supply is overwhelming demand and will force values down.

Jackson Creek 2004 2005 2006 2007 2008 2009 Avg
Sold 89 89 99 82 50 46 76
Avg Price 306786 336210 369368 358065 349981 340884 343549
Expired/Failed 31 46 62 77 93 85 66
Total Units 44 135 161 159 143 131 142
Probability Sale 64% 66% 61% 52% 35% 35% 54%
Listed 34
Avg. List 363882
Sunset Mesa/Saddlerock 2004 2005 2006 2007 2008 2009 Avg
Sold 84 85 61 43 35 41 58
Avg Price 291665 308965 330695 329555 305382 304813 311846
Expired/Failed 78 60 68 64 61 47 63
Total Units 44 145 129 107 96 88 102
Probability Sale 64% 59% 47% 40% 36% 47% 57%
Listed 24
Avg. List 463612
Stone Crossing 2004 2005 2006 2007 2008 2009 Avg
Sold 40 44 31 25 24 15 30
Avg Price 393924 471618 526273 516762 467600 474296 475079
Expired/Failed 4 6 17 23 37 21 18
Total Units 44 50 48 48 61 36 48
Probability Sale 91% 88% 65% 52% 39% 42% 62%
Listed 18
Avg. List 501788
Erindale/Pulpit Rock 2004 2005 2006 2007 2008 2009 Avg
Sold 37 40 48 36 28 23 35
Avg Price 259744 291983 276232 269205 283110 249856 271688
Expired/Failed 42 29 39 38 37 28 36
Total Units 79 69 87 74 65 51 71
Probability Sale 47% 58% 55% 49% 43% 45% 50%
Listed 14
Avg. List 304339

Interestingly, all four areas have a pretty large price spectrum, from as little as $180,000 in Pulplit Rock to $600,000 along the cliff edges, $225,000 in Jackson creek to $650,000 for a newer Saddletree with huge lot and views. So to some degree, there are some very good buys in these neighborhoods. Homes priced less than the average sales price have a greater probability of sale. Homes priced 15 to 30% above average sale price however will have greater difficulty.

The Monument Funk

Woodmoor, Bent Tree/Higby and King’s Deer are Slow, Pretty Slow and Very Slow. Each of the last 3 years they have averaged less than a 47% chance of sale, and all have a year-to-date sales price that is significantly lower than the average price of all listings presently for sale. There is a 9 month supply of housing in Woodmoor, 16 months in Bent Tree and 20 months in King’s Deer. With so much of the “average” property in these areas valued at more than $500,000, the ramifications of the jumbo limit capped at $417,000 are huge: not many buyers have $80,000 or more to put down on a home. The rare, secondary financing that is available to buyers usually is no more than $50,000. So a home asking $550,000 in one of these areas will be competing with another, average-priced home. A buyer shopping in any of these areas could wield enormous leverage in terms of negotiating a lower price.

Bent Tree/Higby 2004 2005 2006 2007 2008 2009 Avg
Sold 27 22 23 14 11 10 18
Avg Price 623984 618202 752679 714000 718938 548322 662688
Expired/Failed 20 13 16 22 40 21 22
Total Units 47 35 39 36 51 31 40
Probability Sale 57% 63% 59% 39% 22% 32% 45%
Listed 15
Avg. List 870120
King’s Deer 2004 2005 2006 2007 2008 2009 Avg
Sold 28 45 30 22 21 15 27
Avg Price 553852 649716 669242 778349 613447 690833 659240
Expired/Failed 49 21 43 42 72 54 47
Total Units 77 66 73 64 93 69 74
Probability Sale 36% 68% 41% 34% 23% 22% 36%
Listed 27
Avg. List 787683
Woodmoor 2004 2005 2006 2007 2008 2009 Avg
Sold 219 216 171 136 121 91 159
Avg Price 365452 413316 421580 428742 388008 393657 401793
Expired/Failed 172 111 114 153 149 142 140
Total Units 391 327 285 289 270 233 299
Probability Sale 56% 66% 60% 47% 45% 39% 53%
Listed 77
Avg. List 454801
Bent Tree/Higby 2004 2005 2006 2007 2008 2009 Avg
Sold 27 22 23 14 11 10 18
Avg Price 623984 618202 752679 714000 718938 548322 662688
Expired/Failed 20 13 16 22 40 21 22
Total Units 47 35 39 36 51 31 40
Probability Sale 57% 63% 59% 39% 22% 32% 45%
Listed 15
Avg. List 870120

AWOL Demand, Decent Supply

Three well known luxury areas have seen buyer demand dry up to the tune of a 1 in 3 probability of sale.

Upper Skyway 2004 2005 2006 2007 2008 2009 Avg
Sold 48 58 36 40 38 17 40
Avg Price 613814 620878 698243 602640 558110 569867 610592
Expired/Failed 25 35 34 58 32 35 37
Total Units 73 93 70 98 70 52 76
Probability Sale 66% 62% 51% 41% 54% 33% 52%
Listed 30
Avg. List 1136400
Cedar Heights 2004 2005 2006 2007 2008 2009 Avg
Sold 8 9 6 4 4 11 7
Avg Price 537611 600550 712333 560875 560875 544850 586182
Expired/Failed 18 9 14 20 19 20 17
Total Units 26 18 20 24 23 31 24
Probability Sale 31% 50% 30% 17% 17% 35% 30%
Listed 8
Avg. List 767112
Unviersity Park 2004 2005 2006 2007 2008 2009 Avg
Sold 29 24 22 15 15 12 20
Avg Price 502279 521746 621344 623465 629780 463813 560405
Expired/Failed 23 23 40 39 33 31 32
Total Units 52 47 62 54 48 43 51
Probability Sale 56% 51% 35% 28% 31% 28% 38%
Listed 22
Avg. List 642754

Cedar Heights is actually rebounding somewhat and has only 8 months of inventory right now. That’s reasonably low for Cedar Heights. The problem however is that the average asking price is a full $200,000 above what has been the average selling price. Recent sales have submarined values to 2004 levels and today’s buyers will likely make similar demands on the present listing inventory. Upper Skyway and Skyway Heights makes a somewhat surprising appearance. Broadmoor Bluffs and the Spires has registered a dramatically higher sales rate in 2008.  Companion neighborhoods Stratton Forest and Stratton Preserve just saw their first sale in two years last month. Perhaps it is the age of the inventory or the difficulty in access, but 2009 has not been a great year near Bear Creek Park. The most heavily impacted area by far, and possibly in the city, is University Park. University Park has a large number of million dollar dwellings and lots valued at over $250,000. However… there has been a 29% chance of sale over the last three years and the average selling price this year is well below the average in 2004. Worse news for present sellers: the average asking price is $180,000 above the average selling price year-to-date. Sellers today will very likely have to make big price concessions to move their property.

The Ultra High-End

The massive economic upheaval and how consumer values have changed (and how they have stayed the same) is readily evident in three neighborhoods known for million dollar properties. The Broadmoor and Kissing Camels are hard places to sell a home, but are showing signs in 2009 that traditional neighborhoods commonly associated with luxury (the Broadmoor) and locations with a true, one-of-a-kind location (Kissing Camels) have value, even in a bad economy. The Broadmoor Resort meanwhile shows the difficulty of selling in a true custom-home neighborhood: one man’s custom, is another man’s consolation. There is a single MLS sale recorded in the Resort this year (translates to 14.8 years worth of inventory). There are additional new homeowners this year in the Resort, but the idea of buying someone else’s home has less value when builders are willing to build “exactly” what they want… and charge less than they did four years ago.

Broadmoor Resort 2004 2005 2006 2007 2008 2009 Avg
Sold 6 17 17 9 6 1 9
Avg Price 1068448 1299786 1392895 1637777 1306333 790000 1249207
Expired/Failed 31 28 16 15 13 18 20
Total Units 37 45 33 24 19 19 30
Probability Sale 16% 38% 52% 38% 32% 5% 32%
Listed 16
Avg. List 1921875
Kissing Camels 2004 2005 2006 2007 2008 2009 Avg
Sold 12 16 24 16 6 9 14
Avg Price 736666 790402 971606 1055814 935000 826700 886031
Expired/Failed 15 19 34 21 36 32 26
Total Units 27 35 58 37 42 41 40
Probability Sale 44% 46% 41% 43% 14% 22% 35%
Listed 28
Avg. List 930487
Broadmoor 2004 2005 2006 2007 2008 2009 Avg
Sold 36 40 21 19 27 24 28
Avg Price 750302 807591 1086173 1085915 825496 673337 871469
Expired/Failed 44 37 35 45 25 29 36
Total Units 80 77 56 64 52 53 64
Probability Sale 45% 52% 38% 30% 52% 45% 44%
Listed 28
Avg. List 1420785

Where to Buy 2010, Part V: 59% increase in unit sales

All the data is Posted Here.

The hurry-up to the analysis is here…

Did the Gazette just describe the real estate market as “Soaring?” What happened to “plummet, freefall & plunge?
Remember November, 2008? There was not a cable-news network minute that went by without some new bank showing signs of weakness, some new stock plummeting, some new unimaginable sum in the billions of dollars being dedicated to a bailout of some enormous, household name entity that was ruled too big to fail. It was being called the biggest Wall Street Panic since the Great Depression and calling it the Great Recession seemed to be a euphemism for investors that were losing money to the tune of 30 to 60% in a single year. Terminology like plummet, freefall and plunge was routine. It was accurately applied to housing as average selling prices lost over 15% in 4 months and demand shriveled up.
December 2nd, 2009: Sales Increase 59%. Last November was the worst November in 15+ years in the Pikes Peak MLS. Numbers are numbers. A cynic looks at that increase and says, “that’s like the Broncos posting 10 points last week in a loss and winning with 16 the next. So what? The offense is still broken.”
In some regards, the system is still broken. There is less than 4 months supply of housing under $250,000 (that is NOT broken, that’s actually a hot-market). But there is over 10 months supply above $250,000 (that’s pretty slow, even for late Fall). If the numbers are used just to describe where things are today as compared to the recent past, the story is told halfway. It is better now than it was then; but how could it really be worse?
Where the numbers start to really illustrate and tell the whole story is when they are mapped and analyzed for trends. Months of Inventory has not been below 6 months on December 1st since the heyday of the boom market in 2005. That’s where it is now. Average price citywide is about $20,000 less than that time and interest rates are a full percent lower. And there are tax incentives to stimulate more demand, most importantly from first-time buyers who by definition, do not have a home to sell. The December Jobs Report showed a significant decrease in the rate of unemployment filings and durable goods orders are coming in ahead of forecast. Baby it’s cold outside… but the sun is shining. Consumers are cautious and value-oriented… but they are no longer terrified.
What Lies Ahead?
Be prepared for lots of forecasts and lots of media attention in the slow December News Cycle to be dedicated to the green shoots of a housing recovery. Some of this will be helpful, some of this will be accurate and a lot of it will paint with a brush broad enough to cover all 50 states in a minute and five seconds. The Real Estate Bust has definitely shown that real estate can move downward as a nation just as it can move upward as a nation. But the extremes of the market have been in coastal areas and places that posted unsustainable rates of growth. Middle America, places where population has continued to grow, places with lower than national rates of unemployment and neighborhoods that were less impacted by the explosive growth of new construction from 2003 to 2006 are the places where the recovery has already sprung. All of the above market conditions apply to Colorado Springs greater metro area.
“Value” will be the operative phrase to describe any recovery. The 2009 Profile of Home Buyers and Sellers showed that the overwhelming reason First-Time Buyers chose to buy a home in 2009 was NOT the First-Time Buyer Tax Credit. Over 60% had the desire to own a home. The 2nd reason? Affordability (10%). Third? Change in Personal Situation (8%). Only 6% sited the tax credit. And yet look at those November sales when the tax-credit was initially supposed to end. It is a nice carrot that helps propel buyers past the tipping point of personal desire, decent selection, low interest rates and real estate at a four to seven year low in price. The tax credit is eventually unsustainable and it certainly does borrow buyers from the future and activate them in the present. But what better time to do that than when housing affordability is at one of it’s highest levels in record? Who else will consume the inventory of properties of willing (or unwilling) sellers who either need to move or hope to change their real estate investment? It greases the wheels of recovery so that the majority of participants can once again begin to buy and sell real estate.
Make no mistake, the old days will not return and the market has changed in nature and what consumers consider “valuable”. Over 90% of 2009 buyers started their search online; 37% found their home via the internet, and only 33% by their REALTOR. That sends an enormous message to sellers: BUYERS WON’T BE FOOLED. Buyers want thorough property descriptions of high-quality properties and will not waste time looking at over-priced and under-conditioned properties. Affordability has increased. Probability of sale will begin to increase. But that will happen only for properties (and sellers) deemed a better value than their peers.