Market Conditions for Loveland, Colorado Reported by B.J. Johanningmeier, GRI, MCSP, ePRO, CMP Updated October 10, 2008.

Current Market Rating: 2 1 2 3 4 5 Buyer's Seller's

Current Price Trend: 2 1 2 3 4 5 Falling Rising

Sales statistics for the month of SEPTEMBER are included here.

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" . . our maladjusted economic system will only be sustained by somewhere in the neighborhood of $2.0 TN of new Credit. It's simply not going to happen. The $700bn from Washington would seem like an enormous amount of support. In reality, it's nowhere even close to the amount necessary for systemic stabilization. To the $2.0 TN or so of new Credit required this year (and next) add perhaps as much as several Trillion more necessary to accommodate speculative de-leveraging (liquidations forced by huge losses). Importantly, the Bust in Wall Street Finance has ensured that insufficient liquidity will be forthcoming to maintain inflated asset prices and sustain the Bubble economy - creating catastrophe for the leveraged speculating community."

~ Doug Noland
"The Wall Street Bust"
CREDIT BUBBLE BULLETIN - (PrudentBear.com)
2 October 2008

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You have come to the right place for accurate and specific reporting of current real estate market conditions for Loveland, Colorado, and surrounding area. Here you will find targeted narrative and statistical reporting designed specifically to give you the most recent and best possible information to assist you in your decision-making regarding buying or selling real estate in Northern Colorado.

On Wednesday 8 October 2008, the Federal Open Market Committee lowered the fed funds rate to 1.5%, ahead of the regular Federal Open Market Committee meeting scheduled for October 28-29th.

However, it is important to point out that mortgage interest rates are not tied directly to short-term rates controlled by the Fed, but rather to the yield on 10-year U.S. Treasury Bonds (at least, historically), but increasing default rates are causing a disconnect here. Mortgage interest rates are dictated by the market for mortgage-backed securities and what buyers of those mortgages are willing to pay, not by what the Fed dictates.

For the week ended October 3rd, the Mortgage Bankers Association said that borrowing costs on 30-year fixed-rate mortgages, excluding fees, decreased to 5.99 percent from 6.07 percent, with points decreasing to 1.09 from 1.12 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The four week moving average for the seasonally adjusted Purchase Index is down 4.1 percent, while this average is up 1.8 percent for the Refinance Index.

Sellers whose property is overpriced for the current market are taking a very considerable risk of loss in value. Sellers have a choice of correct pricing for the current market, or remaining overpriced until the depreciating U.S. dollar becomes worth much less.

TOP TIP ON HOW TO SELL YOUR PROPERTY: Many people start with an overly-optimistic price, knowing that they will be prepared to negotiate. But such tactics could prove counter-productive in the current market conditions and simply deter potential buyers.

We report median prices rather than average prices because they are a more reliable indicator of current trends. The median is simply the middle price; half the buyers paid more and half paid less. Some reporters use average real estate prices, which are usually higher than median prices, because they include some very expensive properties that skew the central tendency upward. (Caveat emptor: the median can fail to capture the "market clearing" price for units that remain unsold, since it takes into account the prices of purchased homes only.)

However, now the median price is being skewed downward because of the difficulty that subprime borrowers are having refinancing or qualifying for jumbo mortgages (loans exceeding the limit for what government-chartered Fannie Mae and Freddie Mac can buy). This is likely to become increasingly difficult in coming months as lenders tighten standards and as home prices drop.

For the month of September, 2008, here are the numbers for SINGLE FAMILY HOME and MULTI-FAMILY (Condo and Townhouse) sales:

In Fort Collins, during this period there were 147 single family homes sold (as compared with 163 during the same period last year), down 9.82% in number of homes sold from the same period last year; new median price $245,000 (up 5.87% from last year, when the median price was $231,420). Ten (10) new homes were sold (median price $240,364), as compared with fourteen (14) new homes sold (median price $221,001) in September last year, down 28.57% in number of homes sold, but up 12.32% in median price.

Also, in Fort Collins, 38 condos were sold (median price $152,000), as compared with 44 sold in September last year (median price $154,000), down 13.64% in the number of units, and down 1.3% in median price. Seven (7) new condos were sold (median price $215,900), as compared with eight (8) new condos (median price $173,900) sold in the same period last year, down 12.5% in number of units, but up 24.15% in median price.

In Fort Collins, in September, we had 7.27 sellers for every buyer of homes on the market priced under $250,000; 7.5 sellers for every buyer of homes priced from $250,000 to $350,000; 14.82 sellers for every buyer of homes priced from $350,000 to $450,000; 20.56 sellers for every buyer of homes priced from $450,000 to $600,000; 42.33 sellers for every buyer of homes priced from $600,000 to $1,000,000; and 56 sellers for every buyer of homes priced over $1,000,000. No homes sold for more than $1,600,000 although 18 higher priced ones were available. [Only 10.33% of all available listings were sold. The ones that were priced correctly, i.e., the ones that sold, were on the market for an average of 101 days.]

In Windsor, during this period, 34 single family homes were sold, median price $218,000, as compared with 34 single family homes sold in September of last year, median price $339,900 (same number of homes sold, but down 35.86% in median price). Seven (7) new homes were sold, median price $485,000, as compared with eleven (11) new homes sold in September of last year, median price $367,526 (down 36.36% in number of homes sold, but up 31.96% in median price).

In Windsor, in September, we had 6.83 sellers for every buyer of homes priced under $200,000; 10.57 sellers for every buyer of homes priced from $200,000 to $350,000; 53 sellers for every buyer of homes priced from $350,000 to $450,000; 55 sellers for every buyer of homes priced from $450,000 to $600,000; 48 sellers for every buyer of homes priced from $600,000 to $1,000,000; and 7 sellers but no buyers of homes priced over $1,000,000. No homes sold for more than $840,000, although 14 higher priced ones were available. [Only 5.76% of all available listings were sold. The ones that were priced correctly, i.e., the ones that sold, were on the market for an average of 100 days.]

In Johnstown, during this period, 23 single family homes were sold, median price $180,500 (as compared with eleven (11) sold during the same period last year, median price $199,900); up 109.1% in number of homes sold, but down 9.7% in median price. No new homes were sold in September this year, as compared with two (2) new homes sold (median price $235,000) in September last year.

Also, in Johnstown, no condos were sold in September this year, same as September last year.

In Johnstown, in September, we had 6.09 sellers for every buyer of homes priced under $250,000; 11 sellers for every buyer of homes priced from $250,000 to $300,000; and 24 sellers but no buyers of homes priced above $300,000. [Only 10.78% of all available listings were sold. The ones that were priced correctly for current market conditions, i.e., the ones that sold, were on the market for an average of 54 days.]

In Berthoud, 13 single family homes were sold, median price $282,895, as compared with ten (10) single family homes sold in September of last year, median price $256,000 (up 30% in number of homes sold and up 10.5% in median price). One (1) new home was sold (price $282,895), as compared with two (2) new homes sold in September of last year, median price $234,000.

In Loveland, 84 single family homes were sold, as compared with 96 sold in September of last year; new median price $212,000 (down 12.5% in number of homes sold, and down 1.35% in price from the same period last year, when the median price was $214,900). Nine (9) new homes were sold (median price $312,681), as compared with fourteen (14) sold in September last year (median price $273,654), down 35.7% in number of new homes sold, and down 14.26% in median price.

Also in Loveland, ten (10) condos were sold, median price $146,894, as compared with ten (10) sold in September last year, median price $144,850 (same number of units but up 1.41% in median price).

In Loveland, in September, we had 9.23 sellers for every buyer of homes priced under $250,000; 10.67 sellers for every buyer of homes priced between $250,000 and $350,000; 28.5 sellers for every buyer of homes priced between $350,000 and $450,000; 22.5 sellers for every buyer of homes priced between $450,000 and $600,000; 24.5 sellers for every buyer of homes priced between $600,000 and $1,000,000; and 23 sellers but no buyers of homes priced over $1,000,000. No homes sold for more than $900,000, although 34 were available. [Only 8.29% of all available listings were sold, and the ones that sold were on the market for an average of 223 days!]

In Greeley, 125 single family homes were sold, as compared with 90 sold in September last year, up 38.89%; new median price $145,000 (down 6.45% from last year, when the median price was $155,000). Four (4) new homes were sold, median price $163,000 (as compared with six (6) new homes sold last September, median price $205,750); down 33.33% in number of units, and down 20.78% in median price.

In Boulder, 67 single family homes were sold, as compared with 98 sold in September last year, down 31.63%; new median price $485,000 (down 15.22% from the same period last year when the median price was $572,090).

[Source: Information Real Estate Services, IRES]

WORD TO THE WISE: The number of Americans able to find prospective buyers for their homes has fallen to a record low since August 2007. The surprisingly sharp fall suggests that the housing market is continuing to decline since lending conditions tightened and credit markets seized up.

Sellers who have their property priced too high may find themselves with NO SALE or CHASING THE MARKET DOWNWARD, eventually having to settle for MUCH LESS than they could have gotten by correct pricing from the beginning.

Resellers are having a very tough time competing with new home sales, since homebuilders (in many cases) are liquidating assets in desperation sales. Often, they are selling new homes at any price they can get, in addition to which they are throwing in huge buyer incentives that make such deals impossible to resist.

New home sales have continued to drop, however, because builders cannot slash prices as ruthlessly as banks have on foreclosed homes. Also, there is a huge "shadow inventory" out there, including not only foreclosures, but also frustrated sellers who have temporarily taken their homes off the market, and others who are waiting to enter it.

So, if you don't need to sell, you should not be in the market now. You are almost certainly not going to realize any profit on your sale. Moreover, you definitely need to be priced at or BELOW current fair market value (as determined by a VERY RECENT comparative market analysis or professional appraisal) to generate a sale. Homes priced "right on the money" will sell. Buyers with poor credit have essentially been closed out of the market now, and buyers with sterling credit (and a sizeable down payment) have the luxury of waiting now. The longer they can wait the better deal they are likely to get.

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Deciding to sell or buy a home is a big step. Make sure it's a step in the right direction by choosing the person best qualified to handle your real estate needs: a RE/MAX Sales Associate.

ZIP Codes: 80521, 80522, 80523, 80524, 80525, 80526, 80527, 80528, 80553, 80537, 80538, 80539, 80550, 80551, 80620, 80631, 80632, 80633, 80634, 80638, 80639, 80534, 80513, 80534, 80546, 80549

Location Characteristics: Northern Colorado - Front Range of the Colorado Rocky Mountains

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