How's the Boulder real estate market and what does the future hold, post Covid? Let's talk about it.
Boulder Market Update
The shaded area in the chart above represents the 3 year average, per month. The yellow line is the most current data. The error bars represent 1 standard deviation.
169 new single family houses hit the market last month, in the City of Boulder - 26.1% above average and 23.4% higher, year over year. This is somewhat surprising after a fairly routine May and June performance.
Despite the influx of new listings, total inventory is trending downward. Last month, there were 245 houses on the market in the City of Boulder - 13.3% below average and down 21.5%, year over year.
Sales exploded in July, with 135 houses trading owners - 42.6% above average and 45.2% higher, year over year. This is the highest sales in a single month since June of 2013.
What does the future hold? There were 144 pending sales last month, the highest monthly number of property under contract in at least twenty years. Preliminary data for August shows the trend continuing.
Absorption matches up to the rest of the analysis - it reached 52.1% last month. The impact of the lockdown is also clearly visible in the chart above.
Note: Absorption is the most recent monthly sales volume expressed as percentage of the preceding month's inventory. Real estate sales typically close in 30-45 days.
Conclusions
What type of conclusions can you draw?
Some of this frenzied market activity is simply due to sales that would have occurred during the Covid lockdown, earlier this year. To point, there were 901 sales during the past twelve months. During the preceding twelve month period, there were 904 sales. Sales volume is basically the same, year over year.
Still, that's a remarkable fact. The United States is in a major recession.
Something to consider: the lowest mortgage rates in history, coupled with unprecedented job mobility and a strange new world for education, is driving a lot of migration and changing family housing needs. At House Einstein, we're working with multiple relocation clients and buyers who are moving up. Some of these are fleeing from east and west coast, high density locations to lower density, highly desirable places like Boulder. Anecdotally, many other top brokers are reporting the same. One claims to be working with five active buyers from Miami alone.
Although it's too soon to predict whether the shift away from cities like New York and San Francisco will be permanent, certainly a large number of families are never going back. Work from home will likely stick around and being able to step onto trails from your own doorstep is never going to get old.
Crystal ball, anyone? I expect an unusually strong late summer and early fall real estate season. If Covid continues to stay under control, expect normalcy to arrive much sooner. If we see another large spike in cases and country-wide shut downs, the market will cool somewhat.
And then there's the impact of the coming presidential election to think about.
Osman Parvez is the Founder and Employing Broker of House Einstein. Originally from the Finger Lakes region of New York, he lives in Boulder with his wife and their Labrador Retriever. He has been a Realtor since 2005.Osman is the primary author of the House Einstein blog with over 1,200 published articles about Boulder real estate. His work has also appeared in many other blogs about Boulder as well as mainstream newspapers, including the Wall Street Journal and Daily Camera. For more information, click HERE.
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The ideas and strategies described in this blog are the opinion of the writer and subject to business, economic, and competitive uncertainties. House Einstein strongly recommends conducting rigorous due diligence and obtaining professional advice before buying or selling real estate.
