Boulder Real Estate (Finally) Gets Busy
There's no denying that Boulder is a highly desirable place to live. So, even though it took a little time, the busy spring season finally arrived in the area last month. And while there was a lot of action in the city of Boulder, Erie, and in general across the county, areas like Lafayette and Longmont experienced mixed results.
Starting with single-family homes in the city of Boulder, there were 174 new listings in April compared to 124 in March, That's also a 15.2% increase year-over-year. Sales also jumped from 52 in March to 82 in April and increased by 22.4% compared to April of 2023.
Days on the market have gone up and down since the start of the year, and April came in at 52—the lowest number yet. In March, it was taking 87 days to sell, so this is very indicative of swift, spring market conditions.
Along with an uptick in pace, prices increased from $1,200,000 in March to $1,565,000 in April, also 18.1% higher the prior year. Still, buyers did find some opportunity to negotiate a better deal to offset interest rates, leading to homes selling for 97.9% of the asking price.
So, where is this tiny bit of leverage coming from amid the high season? One word—inventory.
April closed with 281 single-family properties in inventory, a month-over-month increase of 65 properties and 20.1% higher than the prior year. The city of Boulder now has a 4-month supply of homes for sale, up from 3.2 months in March and 2.7 months in February. A balanced market takes six months of inventory, so this could go either way depending on sales in May and the start of summer.
The market was similar for townhomes and condos. New listings increased month-over-month and sales in this sector increased from 51 in March to 62 in April—and by 17% year-over-year. With more activity, the median sales price increased from $485,000 in March to $545,000 in April which is also 9% above the 2023 price.
And again, the month closed with 183 properties still available for sale, which is a 140.8% increase compared to April of 2023. That's also 3.9 months of inventory compared to 3.1 months in March and a 178.6% increase year-over-year.
Now from a macro level, Boulder County as a whole, the market was somewhat similar.
New single-family listings increased from 360 to 488 while county sales increased from 246 to 301 month-over-month (and by 35% year-over-year). Home prices managed a good uptick, rising from $805,000 to $869,950.
As for condos and townhomes, new listings increased from 185 to 209 while sales increased from 90 to 110 which is on par with 2023. The median price increased slightly from $500,000 to $505,000 as well. However, this was down slightly (1.8%) compared to the prior year.
Looking at city markets, single-family home activity in Lafayette included increased new inventory and sales (up 135.3% YoY), yet the median price month-over-month decreased from $810,000 in March to $767,500 in April which is also 4.7% below the prior year. Over in Erie, new listings jumped from 69 in March to 98 in April, and prices there increased from $712,500 to $731,310 month-over-month but decreased by 5.1% year-over-year.
And finally, in Broomfield County—new listings of single-family homes decreased from 91 to 78 month-over-month while sales jumped from 59 to 73 properties.
Days on the market fell by 12 and April's median price came in at $730,000 which is an increase of over $100k compared to March. April closed with just 79 properties still available for sale across the county, and 1.4 months of inventory. Looking ahead, the typically busy spring season has the potential to heat up even more depending on inventory, demand and mortgage rates.
While the federal interest rate remains steady and mortgage rates elevated, sellers are moving on from homes purchased or refinanced with ultra-low, pandemic rates. How that balances with continued spring demand remains to be seen.
With Boulder and the surrounding markets presenting both opportunities and challenges, working with a seasoned real estate advisor is a must. A proven professional will have the experience, connections and resources to get you the right deal, whether buying or selling. Choose wisely.
Today’s Real Estate Market Explained
It’s no secret that the real estate market has shifted. However, news hype can create a bit of confusion about what’s really going on. Here’s what you need to know.
Today’s Market Is Normalizing. Past speculation that the market would crash did not come to fruition. However, over the last two years, mortgage rates increased sharply which slowed an unsustainable market pace. Now:
- The Federal Open Market Committee has opted to maintain the current fed funds interest rate instead of increasing or decreasing it.
- Accordingly, mortgage rates have eased but remain higher than when the Fed lowered rates to stimulate the economy during the pandemic.
- In response, the real estate market has eased up. It’s taking longer to sell and buyers are adjusting their budgets and expectations.
Market Conditions Are More Balanced. Typically, a six-month supply of homes for sale is considered a balanced market. While Denver and Boulder remain under that figure, the slower pace is creating more motivated sellers.
- Buyers can now take time to find the right home at the right price. But not too long.
- Along with pricing conservatively, sellers are often more open to negotiations and offering concessions such as mortgage rate buydowns.
- Well-priced homes in popular areas are still selling quickly and with multiple offers.
Higher Interest Rates or Higher Prices? It’s no secret that today’s higher interest rates are a big hurdle. However, this doesn’t necessarily mean that you’ll be paying more.
- Not that long ago, many buyers could not “win” bidding wars because the competition was so fierce. On average, homes were going for 25% or more over the asking price.
- In addition, buyers often waived inspections and other protections that left them paying for costly repairs on their homes.
- Some also paid cash for an appraisal gap and put down non-refundable earnest money which made it costly to get out of a contract if serious issues came up along the way.
Is Now a Good Time to Buy? Consider that in today’s market, buyers have more time to search, and the opportunity to get a well-priced home, complete with an inspection and possibly seller concessions. More reasons:
- You've found the right house and can afford it comfortably—that includes having about six months of money saved in an emergency fund.
- Your credit score is high and your debt-to-income ratio is low. These are two major factors when it comes to qualifying for a mortgage with the best rate and terms.
- You plan on staying in the home for a long time. Historically, equity is gained slowly and steadily with national appreciation values averaging around 3.5-3.8% annually.
- You understand that you can potentially refinance to a lower rate down the road.
