If you’ve been reading my blog, you know I don’t place much store in Zillow, but this article in the Denver Business Journal shows the exception. When Zillow creates the quarterly reports they’re pulling the broader market home sale stats which is far more reliable than when they’re pricing your home. Though I find the writing rather convoluted, there are a few things to note in this article.
Metro Denver home values dropped almost 7 percent in the second quarter from the same period of last year, but values crept up from the first quarter at a slightly higher rate than the national average
During the 2Q of 2010 we were still experiencing the bump from the First Time Buyer Tax Credit created in 2008. (There are still tax credits for home buyers by the way) And see what I mean by convoluted?
average metro Denver home values fell 6.9 percent in the second quarter from 2010, but gained half a percentage point from first-quarter values.
If we take the tax credit years, which falsely inflated prices and stimulated activity, and look at 2011 on its own, we’re up in 2Q over the 1Q. Some of this is seasonal, of course. The next three things may peak your interest.
*24% of all 2Q home sales in the Denver metro area were foreclosures.
* June sales saw that 30.8% of sellers sold at a loss.
Overall, home values in metro Denver have fallen 15.5 percent since the peak in June 2006, according to the report. The last time values were at this level locally, $196,300 according to the Zillow Home Value Index, was in February 2001.
So what does this mean for you? If you are looking to buy a home (and I know that’s a scary proposition after all of this debt ceiling and default debate), houses are not only FOR SALE they’re ON SALE, and so is the money. This is the perfect time to “move up” to a larger home or get into a favorite neighborhood you’ve been priced out of. If you currently own a home, you may want to look into keeping it as a rental property for cash flow. Not always possible, but definitely worth exploring. Vacancy rates are very low, pushing demand (and rents) higher. If you have been wanting to get into your first home or out of an apartment and into a condo, and feel you’ve missed the moment… not quite yet. Interest rates, baby.
And if you are a seller; yes, your home has lost some value based on market decline since the 2006 peak, but well-priced homes are still selling and there are qualified buyers out there. If you fall into the 30% who are upside down and you’re having trouble making your payments or need to sell for other reasons, give me a shout. I’ve got a great track record with short sales if that’s your best option. If you can avoid it, I’ll do my damnedest to make sure you get the most for your home. Sometimes the loss is greater than the stress of being overstretched. For investors building rental portfolios or doing fix and flips, this is all good news. If you are interested in finding out how your neighborhood fares in today’s markets, shoot me an email or comment on the post. I’d be glad to send you a Your Castle Trends Map or come by and give you a personalized Comparative Market Analysis.
On the good side… the DOW closed up 400+ points today and the Feds have agreed to keep interest rates low until 2013
That’s all for now.