Market Conditions for Loveland, Colorado Reported by B.J. Johanningmeier, GRI, MCSP, ePRO, CMP Updated July 5, 2009.

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

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

COMING SOON: Sales statistics for the month of JUNE 2009.

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The White House stood by passively this spring as banking lobbyists mobilized to castrate the administration's Helping Families Save Their Homes Act. The final version eliminated the key provision that would have allowed judges to lower the principal for mortgage holders whose homes are worth less than their loans. Dick Durbin, the Democratic senator from Illinois, correctly observed in April that the banks are "still the most powerful lobby" in Congress and that "they frankly own the place."

The banks' influence at the other end of Pennsylvania Avenue is also conspicuous.

~ Frank Rich, "Obama's Make-or-Break Summer"
THE NEW YORK TIMES, 20 June 2009

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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 24 June 2009, the Federal Open Market Committee announced that it would keep the range for the Fed Funds Rate at 0 to 0.25%. [The decision to set a range for the fed funds rate reflects an admission that the US central bank--which normally targets an exact rate--is no longer able to tightly control the actual rate that prevails in the market because of the massive creation of reserves.] As previously announced, to provide support to mortgage lending and housing markets and to improve overall conditions in private credit markets, the Federal Reserve will purchase a total of up to $1.25 trillion of agency mortgage-backed securities and up to $200 billion of agency debt by the end of the year. In addition, the Federal Reserve will buy up to $300 billion of Treasury securities by autumn.

Historically, mortgage interest rates have not been tied directly to short-term rates controlled by the Fed, but rather to the yield on 10-year U.S. Treasury Bonds, but increasing default rates have caused 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, and so, now that the Fed is buying mortgage backed securities, this should (in theory) have the effect of lowering mortgage interest rates. By purchasing these bonds, the Fed would narrow the spread between their yields and yields on U.S. Treasuries, and allow banks to offer home loans at lower rates. Recently, however, the so-called bond-market vigilantes (bond market investors who protest monetary or fiscal policies they consider inflationary by selling bonds, thus increasing yields) have begun rebelling against government "bail-outs" by selling U.S. Treasury Bonds, thus driving up yields and mortgage rates.

For the week ended June 26th, the Mortgage Bankers Association said that the volume of applications filed to refinance mortgages decreased a seasonally adjusted 30% from the pace of the week before and applications for mortgages to purchase homes decreased a seasonally adjusted 4.5%. Borrowing costs on 30-year fixed-rate mortgages, excluding fees, decreased to 5.34 percent from 5.44 percent, with points increasing to 1.12 from 0.99 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The average rate on 15-year fixed-rate mortgages decreased to 4.81% from 4.93%, with points increasing to 1.04 from 0.92 (including the origination fee) for 80 percent LTV loans. The four week moving average is unchanged for the seasonally adjusted Purchase Index, while this average is down 15.2 percent for the Refinance Index.

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. Sellers whose property is overpriced for the current market are taking a very considerable risk of loss in value.

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 has become increasingly difficult as lenders tightened standards and as home prices drop.

For the month of May, 2009, here are the numbers for SINGLE FAMILY HOME and MULTI-FAMILY (Condo and Townhouse) sales:

In Fort Collins, during this period there were 172 single family homes sold (as compared with 238 during the same period last year), down 27.2% in number of homes sold from the same period last year; new median price $244,000 (up 4.05% from last year, when the median price was $234,500). Twenty-one (21) new homes were sold (median price $340,266), as compared with twenty-one (21) new homes sold (median price $244,724) in May last year, same number of homes sold, but up 39.04% in median price.

Also, in Fort Collins, 54 condos were sold (median price $145,000), as compared with 80 sold in May last year (median price $147,000), down 32.5% in the number of units, and down 1.36% in median price. Four (4) new condos were sold (median price $191,000), as compared with thirteen (13) new condos (median price $178,820) sold in the same period last year, down 69.23% in number of units, but up 6.81% in median price.

In Fort Collins, in May, we had 7.26 sellers for every buyer of homes on the market priced under $250,000; 7.14 sellers for every buyer of homes priced from $250,000 to $350,000; 13.71 sellers for every buyer of homes priced from $350,000 to $450,000; 24.13 sellers for every buyer of homes priced from $450,000 to $600,000; 38.33 sellers for every buyer of homes priced from $600,000 to $1,000,000; and 60 sellers for every buyer of homes priced over $1,000,000. No homes sold for more than $1,100,000 although 50 higher priced ones were available. [Only 10.74% 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 106 days. Overall, in Fort Collins in May, there were 9.31 sellers for every buyer.]

In Windsor, during this period, 29 single family homes were sold, median price $255,000, as compared with 38 single family homes sold in May of last year, median price $249,000 (down 23.68% in number of homes sold, but up 2.41% in median price). Three (3) new homes were sold, median price $287,000, as compared with eleven (11) new homes sold in May of last year, median price $345,000 (down 72.72% in number of homes sold, and down 16.81% in median price).

In Windsor, in May, we had 8.1 sellers for every buyer of homes priced under $200,000; 13.45 sellers for every buyer of homes priced from $200,000 to $350,000; 18.2 sellers for every buyer of homes priced from $350,000 to $450,000; 37.67 sellers for every buyer of homes priced from $450,000 to $600,000; 71 sellers but no buyer of homes priced from $600,000 to $1,000,000; and 11 sellers but no buyer of homes priced over $1,000,000. No homes sold for more than $569,000, although 100 higher-priced ones were available. [Only 5.74% 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 115 days. Overall, in Windsor in May, there were 17.41 sellers for every buyer.]

In Johnstown, during this period, fifteen (15) single family homes were sold, median price $245,000 (as compared with twenty (20) sold during the same period last year, median price $204,500); down 25% in number of homes sold, but up 19.8% in median price. Two (2) new homes were sold in May this year, median price $278,000, as compared with four (4) sold in May last year (price $274,359), down 50% in number of new homes sold, but up 1.33% in median price.

Also, in Johnstown, no condos were sold in May this year, as compared with three (median price $170,000) sold in May of last year.

In Johnstown, in May, we had 13.33 sellers for every buyer of homes priced under $250,000; 11.75 sellers but no buyers of homes priced from $250,000 to $300,000; and 15.67 sellers for every buyer of homes priced above $300,000. [Only 7.55% 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 103 days. Overall, in Johnstown in May, there were 13.25 sellers for every buyer.]

In Berthoud, seventeen (17) single family homes were sold, median price $220,000, as compared with sixteen (16) single family homes sold in May of last year, median price $237,500 (up 6.25% in number of homes sold but down 7.37% in median price). No new homes were sold, as compared with one new home sold in May last year (price $794,500).

In Loveland, 79 single family homes were sold, as compared with 125 sold in May last year; new median price $195,000 (down 36.8% in number of homes sold, and down 6.25% in median price from the same period last year, when the median price was $208,000). Five (5) new homes were sold (median price $345,000), as compared with sixteen (16) sold in May last year (median price $230,000), down 68.75% in number of new homes sold, but up 50% in median price.

Also in Loveland, thirteen (13) condos were sold (median price $137,000), as compared with twelve (12) sold in May last year (median price $139,000), up 8.33% in number sold, but down 1.44% in median price.

In Loveland, in May, we had 10.73 sellers for every buyer of homes priced under $250,000; 9.71 sellers for every buyer of homes priced between $250,000 and $350,000; 16.29 sellers for every buyer of homes priced between $350,000 and $450,000; 71 sellers but no buyer of homes priced between $450,000 and $600,000; 81 sellers for every buyer of homes priced between $600,000 and $1,000,000; and 43 sellers but no buyer of homes priced over $1,000,000. No homes sold for more than $648,450, although 114 higher-priced ones were available. [Only 7.48% of all available listings were sold, and the ones that sold were on the market for an average of 114 days. Overall, in Loveland in May, there were 13.38 sellers for every buyer.]

In Greeley, 105 single family homes were sold, as compared with 149 sold in May last year, down 29.5%; new median price $139,000 (down 7.33% from last year, when the median price was $150,000). Seven (7) new homes were sold, median price $162,940 (as compared with seventeen (17) new homes sold last May, median price $274,000); down 58.82% in number of units, and down 40.53% in median price.

In Boulder, 58 single family homes were sold, as compared with 107 sold in May last year, down 45.79%; new median price $479,900 (down 6.56% from the same period last year when the median price was $535,000).

[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 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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Production
That experience and education means RE/MAX Associates are better qualified to set the right price for the homes they list, are better equipped to market those homes, and are likely to find a buyer in a shorter period of time. That experience and education also means they are better qualified to find the right home for any buyer. As a result, the average RE/MAX Sales Associate out-produces competing agents three to one.

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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