Tag Archives: Jackson Creek

Greenshoots 2013: Tri-Lakes / Monument

It’s somewhat predictable that the market’s recent resurgence would be expressed in places like Briargate and the Northwest with desirable qualities, but generally, average sales prices within $75,000 to $100,000 of average. These are the areas someone familiar with Colorado Springs would expect to see a resurgence.

But what about the hire reaches of the market? We saw signs of growth happening in Southwest (S/W) Cheyenne Mountain District 12, and are seeing similar growth in Tri-Lakes/Monument.

We will start with the big kahuna of the North, Woodmoor. Because the mapping software can only digest so much data at once, and has to look at the entire history of the area because of some MLS idiosyncrasies, we had to break apart Woodmoor into three different sections, North, Central and South:

North Woodmoor including High Pines and Greenland Forest, generally north of the Country Club, south of County Line, east to Furrow, one of the newer stretches by average year of build (definitely true in High Pines and Greenland Forest)

Northern Woodmoor including High Pines and Greenland Forest Neighborhood PatternNorthern Woodmoor including High Pines and Greenland Forest ScattergramNorthern Woodmoor including High Pines and Greenland Forest Time to SellNorthern Woodmoor

Central Woodmoor, from Woodmoor Drive south to Highway 105, and east across Furrow to the border with King’s Deer.

Central Woodmoor and East of Furrow Buying Pattern Central Woodmoor and East of Furrow Neighborhood Patterns Central Woodmoor and East of Furrow Scattergram Central Woodmoor and East of Furrow Time to Sell

South Woodmoor, the rest of the neighborhood south of Highway 105
Woodmoor south of 105 Buying Patterns Woodmoor south of 105 Neighborhood Patterns Woodmoor south of 105 Scattergram Woodmoor south of 105 Time to Sell

Going west of the interstate to Palmer Lake, we found a market that was (as usual in Palmer Lake)  harder to define:

Palmer Lake Buying Patterns Palmer Lake Neighborhood Patterns Palmer Lake Scattergram Palmer Lake Time to Sell

One of the very best selling places in the region last year was in Jackson Creek. The doldrums that had plagued the area over the last couple of years loosened substantially.

Jackson Creek Buying Patterns Jackson Creek Neighborhood Patterns Jackson Creek Scattergram Jackson Creek Time to Sell

The higher end is very well-represented in Tri-Lakes, and we looked at King’s Deer, Fox Run, Bent Tree / Higby Estates. The truly high-end neighborhood of High Forest Ranch was excluded from this search so as to showcase it in a later survey that places it with the other luxurious high-end neighborhoods in Black Forest and NGT, like Cathedral Pines and the Abert/New Breed/Bridle Bit stretch along Shoup.

King’s Deer

Kings Deer Buying Paterns Kings Deer Neighborhood Paterns Kings Deer Scattergram Kings Deer Time to Sell

Fox Run

Fox Run Neighborhood Patterns Fox Run Scattergram Fox Run Buying Patterns Fox Run Time to Sell

Bent Tree / Higby Estates

Bent Tree Neighborhood Patterns Bent Tree Scattergram Bent Tree Buying Patterns Bent Tree Time to Sell


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.

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.

2009 End of Year Market Report

Updated Market Data

The 2009 Sales Year ended dramatically different than it began.

January was the depths of doom and gloom, lots of listings, lots of fear, skyrocketing job losses, Wall Street hemorrhaging.

Now, we’re back to worrying about Simon Cowel leaving Idol and “shocked” at the admission Mark McGwire used steroids. In other words, the economy is no longer a paramount concern.

But housing is. Last year, 62% of first-time buyers purchased a home because they had strong sentiments about home ownership. The good value rationale was sited as the number one reason among only one in ten respondents to the National Association of REALTOR’s Profile of Home Buyer’s and Sellers.

Locally, this bore itself out with a dramatic shift in the marketplace. The under $250,000 market improved throughout the year, while the $250,000 to $325,000 market made headway… and above $400,000, things actually got worse. Right now, 38% of all listings are over $300,000. Yet only 16% of all sales in 2009 were over $300,000.

Read more at Colorado Springs market leader in real estate information you can use, THE STAT PACK!

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 in 2010: Part I

I have a lot of buyers looking to make a purchase in the next 12 months. Many of these buyers are relocating into the area. This is a promising sign for overall market recovery.

It also is testing my mettle in helping them choose an area to focus their search. Buyers have no problem rattling off a list of what they want in a home. It gets a lot fuzzier when they are challenged to think about where they want their home. Case in point:

I tell every seller this nugget of wisdom: Buyers have three concerns that we must market your home to. 1.) No buyer wants to pay too much for a home. 2.) All buyers are afraid something is wrong with the home. 3.) What if someone else gets the home? Fear 1 and Fear 2 CAN be controlled by a good listing agent. A properly priced home in-line with consumer expectations will get traffic. A well-staged and inspected home will overcome the fear of something being wrong with it. That places a buyer in the position of “what if someone else gets the home?”

I’ll admit, as a REALTOR, I like to sell in the areas that have more “what if someone else gets the home?” properties. This is not because I like inflicting psychological terror upon my buyers (it is fun, though!). It is because these are the properties that are more likely to appreciate, stand the test of time, and are in the “interesting” parts of town that are so unique to El Paso County.

There’s a temptation to think that “when the market comes back” that the old rules will apply. This tempting thought seems to extend out to properties rising in value, buyers preferring more house when they can get it, that more financing rather than smarter financing is all going to occur. To some of that, I say yes… properties will eventually start to rise in value by 4 and 7% a year, and buyers as they move “up” in life will probably want more, not less square footage, and there is a time and place for 10% secondary financing.

But who really believes that 40% of all home sales should be non-owner occupied units? Who thinks that it is a sign of a healthy market when the national residential renting rate is 11%… but 28% of all single family units sold were purchased as “investment property”? Can you find that missing 17% of the population who is supposed to “rent” these properties? These were the market conditions in the 3rd and 4th quarters of 2006. If you really uncork the math on that, inside that 40% number is a really terrifying number: 12% of all units sold were not even investment properties but “2nd homes”. And Nicolas Cage didn’t go on his buying binge until 2007. The raw aspects of that freakish lending means that one in eight people buying a house in 3rd or 4th quarter 2006 – nationwide –  did not have to show sufficient income to offset the cost of ownership. This would involve everything from a beach house on Anini Beach to a condo in Breckenridge to a patio home in Flying Horse to a high-rise condo in South Beach… maybe the latter two were acquired with the intention of the persistent run-up in new construction values, a builder-leveraged flip if you will. But 12% of the homes purchased quarter 3 and quarter 4 were purchased with the lender acknowledging… no one is planning on occupying this residence. Folks… those were the good old days. Return to that?

Yes, this is all the product of the Lehman Brothers subprime financing and we all know that these loans don’t exist anymore. Does that make the market safer? Does that make the market less prone to subprime thinking?

The answer to both, is no. Here is the advice of a CNBC commentator on how we ought to deal with our economic recovery. Who exactly does this benefit? How and where are the jobs being created? I mean, outside of the mortgage shops? The answer is more debt, re-fi’s to people upside down and greater negative liquidity?

If the idea of “greater negative liquidity” sounds like a bad idea, than would it not be wise to dial in on properties where the threat of “greater negative liquidity” is lower? Similarly, it seems to make sense that properties that encourage “greater positive liquidity” would be wise. Real Estate has a handy solution: the dirt matters.

Buyers are always attracted to the shiny and new. Apple is a great example of this. People will pay for style. If they did not, Apple would not exist. Apple World would not be the can’t miss event it is. The reality is, my MacBook Pro is heading on year three and just had it’s first major service: it needed a new battery because I exhausted the old one. The remarkable computing device just keeps plugging and multi-tasking and tweeting and I’m all the more efficient for it. There is no engineered obsolescence on this machine like there is inside my piece of junk desktop. Replacing my Mac would be foolhardy. The value is built right in and it is still there today. Yeah, it still looks good, but the functional value supersedes the style. What I bought then still works today.

This is directly similar to the 2010 Colorado Springs Real Estate Landscape. Buyers in 2010 have the opportunity to buy something now that will still work out well for them in three years, six years, 15 years. The common denominator is dirt.

Just as I have a computing tool in my possession that lets be more effective and more efficient, buyers in 2010 will have a landscape that is akin to a gambler’s dream: they can buy with the benefit of history on their side. Compare the November 1, 2002 market to the November 1, 2009 marketplace:

2002        2009

Active Listings               4218         4453

Sold October Units        756           773

Avg. Sales Price         $209,108 $213,352

Interest Rate                   5.88%     4.88%

The numbers look like a 2002 reset. The reality is that home values are really somewhere between 2000 and 2005 depending on the area and type of property (condos and townhomes have fallen faster and farther than single-family). The supply and demand ratios are extremely similar. The November, 2002 stats reflect a market right before the big wave of demand struck the marketplace. These conditions helped catalyze the four year run up in value (because our demand was somewhat strong and inventory high however, they also acted as a deterrent to the astronomical run-up more common in coastal markets). The number that stands out like a soar thumb: the present buying power a buyer enjoys at today’s near-record low interest rates give them the ability to buy 11% more property. Or better said… they can buy with 11% more affordability than they could in 2002. And do so with the power of knowledge that the city looks very different today than it did than.

Pinecliff is 11 minutes from downtown, offering 5400 square feet under $500K with D20 schools

That “foresight knowledge” of seven year’s of city growth is the really valuable commodity. Since 2002, 26,000 single family homes have been constructed. That’s approximately 30% of Fountain and Falcon, a large chunk of Pine Creek, all of Cordera and Wolf Ranch, Banning-Lewis, Stonecliff in the Spires, Cathedral Pines, half of High Forest Ranch, half of Jackson Creek and quite a bit of Monument. These places did not exist 7 years ago. They do now.

That means that a buyer now can actually see the city, not the master plan. Will there be views? Sort of. How are the roads? What are the commute times? Will there be a fire station? Where are the schools? Are they any good? Rather than rely on theory, they can go check out in person each of these key data-points. That means that a buyer can see and feel and touch and appreciate the historical ramifications of good buying decisions… and bad ones.

Within this marketplace there are enormous curves in supply and demand. High Forest Ranch for instance only has a year of inventory to sell through right now. That is similar to Flying Horse. Yet High Forest Ranch is an $800,000 neighborhood and for all their attempts to be uber-luxury, Flying Horse is really a $500,000 area so far. To have a year of inventory in 2009 is remarkable… that’s similar to what an $800,000 area enjoyed in the market boom year of 2005. When supply and demand approach balance, values cease declining and the ability to define a remarkable home on a remarkable parcel increases.

Tactically speaking, buying a home that is newer, with modern flair and “nothing wrong with it” is a good idea.

Strategically speaking, where such a home exists matters infinitely more. Right now there are areas in-balance, seeking balance and wildly out-of-balance. This week we will explore the markets in-balance. Next week, the markets seeking balance. After that: the markets that are still in trouble.