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Mar 26, 2008 6:06 pm US/Mountain
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Silver Lining For Housing Market On Front Range
DENVER (CBS4) ―
The national housing market continues its downward spiral, but there's a silver lining for Colorado's Front Range.
Nationwide, home values have plunged by 11 percent in the past year, the biggest drop since 1987, and experts say it's the first housing decline to hit the whole country.
Metro-wide, Denver has seen a slight drop in housing prices, but nothing like other parts of the country that are experiencing double digit drops in housing values. Real estate experts say metro Denver has been pretty stable compared to the rest of the country and is poised for a quicker recovery.
Denver housing prices went down 5 percent in January. Not the kind of news sellers want to hear, but relative to other cities, Denver's slide might not seem so bad.
"The housing market in Denver has not had the same kind of crazy upside that some other markets you've seen in California, Florida and Arizona are probably the best three you could look at from that standpoint," said Glenn Mueller, University of Denver Real Estate Professor.
Cities like Las Vegas and Miami are reporting more than 19 percent drops in home prices, due to speculation and too much construction.
Metro Denver hasn't seen those kinds of price swings up or down. Because the employment picture in Colorado has been relatively stable, experts say the recovery here should come that much quicker.
"Job growth that actually creates demand for housing is actually as good or better than many other places in the country, so on the demand side, things look relatively good," Mueller said.
Real estate brokers say while prices have dropped a few percentage points, there's other indicators that should give home sellers a reason to feel optimistic.
"February of 2008 versus February of 2007, the number of under contract is up almost 7 percent. The average days on the market, which is an important factor for sellers, is down 11 percent," Brad Whitehouse with RE/MAX Professionals said.
While the northeast metro area is struggling with foreclosures, much of the south and southwest metro area is doing comparatively well. More homes sold in less time means new listings are spending fewer days on the market.
"So Littleton, Highlands Ranch, really the south Denver metro area and in some cases the northwest metro area, isn't looking at the difficulty that other parts of the town might be," Whitehouse said.
Interestingly the bad news in other states like Arizona and California could be good news for Colorado. As companies look for places to set up shop, they look to the affordability and stability of the housing markets. Colorado is well situated in the West to benefit from that.
Despite incentives from builders and relatively low mortgage rates, sales of new homes are down nearly 30 percent nationwide from this time last year.
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