Is the Boulder Market Cooling Yet?

The following introduction to Fresh Listings was written prior to the school shootings in Uvalde, Texas. At House Einstein, our thoughts are very much with the innocent children whose lives were cut short in senseless and horrific gun violence. We cannot imagine the loss their families are suffering. Children should be able to attend school without fear of gun violence. Parents should be able to drop their kids off, without worrying it will be the last time they see them. It was not too long ago that Boulder experienced a mass shooting, and this event is deeply triggering for many members of our community. It's OK to not be OK, right now. As a community, we have resources available.    For the full Fresh Listings newsletter, which includes a discussion of active and recently sold property, sign up HERE.

What's New at House Einstein? From a business perspective, it’s been a busy month; we launched several new listings, put several properties under contract, and held several closings.  About three years ago, we began investing heavily in improving marketing for our listings. This included investments to improve staging consultations, pre-sale inspections, contractors for home improvements, high-end videography and photography, distribution on social media, and improvement in our branding. The results:  We now have many more listings and our sold clients, measured by their referrals to friends and family, are happy with our service. We deeply appreciate their trust.    Our listing videos typically receive between 5,000 and 10,000 thru plays on social media during the first two weeks of a listing. This is all from our local market, we’re only advertising within a 15 - 30 mile radius of Boulder. This is in addition to traditional exposure with still photography on the MLS, the limits of what typical Realtors do. We see few other Realtors in our local market investing at this level to market their listings.    As you might expect, this sort of marketing doesn't come cheap. We spend 5X what a typical listing agent spends on marketing listings. You read that correctly: 5X. The additional exposure is well worth the effort. For each property we list, we’re not just pricing it right, we’re going the extra mile to help buyers understand the unique value proposition of the property, and we're making sure the best aspects of our listings get noticed.   Is it worth the effort? You bet it is. Even during the high peak of market activity in 1Q, listings that were professionally prepared and intelligently marketed sell for more money and sell quicker. Now, as the market begins cooling, effective marketing will become ever more important.

How's The Market? The impact of higher mortgage rates are impacting the real estate market. Buyers utilizing a conventional 30YR mortgage have experienced a ~20% reduction in purchasing power. Cash buyers are also starting to feel a little less confident with the S&P 500 down about 19% from the beginning of the year. Accordingly, sales volume has begun to slow, dropping about 6% YoY last month and inventory has begun to tick ever so slightly upward.   You might expect a reduction in purchasing power to be felt locally, but for now we’re still seeing bidding wars - at least on the most attractive listings. To point, this month one of our buyers submitted on a historic listing in Louisville at $115K over list, and lost to a buyer who offered a premium in excess of $300K. That home had signs of foundation issues, by the way. Another of our buyers were outgunned in a bidding war on a house in Table Mesa, only to get a second shot when the first buyer got cold feet. They’re now heading to closing at the end of the month. Remember: you may not be able to compete with irrational buyers, but you can stay disciplined. Sometimes the market rewards you. Sometimes, all you can do is sit on the sidelines and scratch your head at how much others are willing to (over)pay. At this point, there’s no surplus of inventory in Boulder or Denver. Yet the market is undoubtedly cooling. Based on early market indications, I expect higher inventory and thus selection will be better than last year in 3Q and 4Q.  I don’t expect wholesale price declines across the entire market. Some locations and property types might see some measure of lower prices - but only in the weaker and less desirable segments of the market. Buyers will get more options, sellers should price intelligently. It may be wiser to aim for slightly below the comparables, not above as most Realtors typically recommend.

Osman's Personal Update Hard to believe that the month of May is nearly over.  Two major personal events this month; celebrating my nephew Emerson’s third birthday and holding an end of life ceremony for my golden retriever. These events perhaps sound like opposite ends of the spectrum, but both were really a celebration of life; an occasion to get together with friends and family, and recognize the milestones that mark our lives.  The party for Emerson was fun. Held at an elementary school playground in Denver, it was all smiles and laughter, from a gaggle of attendant toddlers and young children. Lots of cake was eaten. Far, far too much cake, as my bathroom scale will attest.   Marley’s ceremony was decidedly harder and I admit, long overdue. I’ve been holding on to his ashes for three years, reluctant to truly let him go. On a quiet weekend, a perfect Saturday morning, we took his ashes to his favorite spot and quietly scattered them. A small group of his favorite humans attended and shared our memories of him. It was poetic and deeply meaningful. I had a lump in my throat for two days.

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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.