Denver Real Estate Market Conditions for February 2007

By
Real Estate Broker/Owner with Buyers Advantage Real Estate of Metro Denver CO #40010656

Emerson Street Victorian

The Denver real estate market for February is beginning to show the results of too many houses on the market.  Denver still ranks right up there as having the nation's number one inventory of foreclosures, which is making it difficult to sell homes without having to lower the price from a seller's initial hopes.

Sales were down from January nearly 13%.  Some of that may be due to Denver's December through February snow, which this year was considerably more than any average year in the Denver area.  Streets stayed nearly unpassable for weeks waiting for warmer weather to set in and melt the icy ruts.  Buyers did tend to stay home and wait till the streets were less of an obstacle course.

Prices dropped only slightly, but values can't keep pace with rising inflation.  If you have to sell a house right now in Denver, you'd better make sure it measures up to the best homes in your part of the market, or you'll be looking to lower prices monthly till you hit the value right.  Days on market has increased nearly 20% over this time last year.

Buyers, on the other hand, are having a heyday, with interest rates as low as they've been in awhile, and a great inventory to choose from.  Homes are selling for up to an average of 5-10% off asking price (another reason for sellers to make their prices realistic).  Some recent buyers have had trouble making up their minds among all the choices available.

The spring market promises to be a bit better than the winter market, but not enough to send sellers' hearts a-flutter.  Buyers are still in the driver's seat in Denver.

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Rainer
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Stefan Scholl
Buyer's Broker of Northern Michigan, LLC - Petoskey, MI
Northern Michigan Real Estate

Judith,

I am curious as to what is behind all the foreclosures in Denver.  Detroit, I can understand.  But Denver?

Mar 11, 2007 01:16 PM #1
Rainer
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Judith Clausen
Buyers Advantage Real Estate of Metro Denver - Denver, CO
Judith R. Clausen

Denver was one of the two states who didn't find it necessary to regulate mortgage brokers, Alaska being the other.  Now we're licensing them -- fingerprinting and criminal background checks -- but they're still largely unregulated.  There are no requirements for continuing education, no exams to undergo, no Code of Ethics to adhere to.  That may change this spring with new legislative action expected. But in the meantime, subprime and exotic loans led to home owners defaulting at a rapid rate when payments soon outpaced sellers' ability to pay.  The recent recession (2001) didn't help.  Many folks lost their jobs in the telecom and dot.com industries.  Couple that with unexpected medical emergencies or any other kind of unexpected reduction in income, and we had a flood of foreclosures on our doorstep.

 

Mar 11, 2007 01:34 PM #2
Rainer
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Stefan Scholl
Buyer's Broker of Northern Michigan, LLC - Petoskey, MI
Northern Michigan Real Estate

Judith,

It looks like the loose lending practices are finally starting to catch up with the subprime lenders.  I recall that Denver used to be somewhat of an oil town.  With the price of oil, I would think that would be a boon for your area.  Thanks for your explanation regarding your foreclosure rate.  I still find it kind of surprising that Denver is in the lead in this regard.

Mar 13, 2007 01:41 PM #3
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Judith Clausen

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