Consumers Show Confidence in the Value of Their Homes Americans are confident their homes are retaining, even gaining value, according to a nationwide telephone survey of 1,007 adult Americans conducted May 31-June 3, 2007. Here are a few stats from the survey's findings: 55% say their home would sell for more money now than it would have a year ago. 74% of homeowners say they're confident they could sell their home within the next six months at a price they think it's worth. 85% believe their house will be worth more five years from now than it is today. 27% say they're likely to purchase a better home over the next five years. "Americans Express Confidence in the Value of Their Homes, Despite Softening Housing Market," Business Wire, press release by Boston Consulting Group, June 21, 2007. Consumers Show Confidence in the High-End Market A 2007 Coldwell Banker Previews International® Luxury Survey of people living in homes valued at more than $1 million (or $2 million in California) found that homeowners are fairly confident in the future.
• 58% said they believe increases [in the value of their home] will continue over the next five years, and 36% said those increases would be significant.
• 40% said they felt comfortable enough with the housing market that they were considering buying a second home.
Excerpt from "Upscale Homeowners Confident in Future," Real Estate Intelligence Report, Vol. 13, No. 27, July 2, 2007.
"This extraordinary run-up in rental rates is going to continue through 2008 and into early 2009. There is just not a lot of space around and not a lot of big blocks of space," regarding the Manhattan commercial real estate market. "The hedge funds are sort of floating this market right now because they are willing to pay significant dollars in rentals. Manhattan is still the place to be."
Redfin’s Rebates to Buyers? The Answer From A Full-Service Perspective During a “60-Minutes” interview on May 13, Leslie Stahl said, “Redfin very proudly says that they returned in rebates $3 million last year to its buyers. You can't boast of anything like that." Deborah Arends, a RE/MAX agent for over 18 years, responded, "Absolutely not. I don't know how to answer that one." Here’s how the agent should have responded, according to John Featherston, founder/publisher of RISMedia, a national real estate trade news organization: “Of course Redfin is willing to give money back to the customer because they’re not owed the money in the first place. The Realtor's marketing, negotiating skills, and reach into the market is the experience the seller is paying for and that will ultimately put more money in the seller's pocket!" Click here for more of Featherston’s response.
And Now … Positive News in Your Local Markets: Many cities, such as Atlanta, Dallas and Denver sat out the housing boom, and are now seeing prices rise instead of fall. Seattle had the largest price gains over the past year, according to the S&P at 9.6 percent, and prices were also up in Charlotte, N.C. (7%) and Portland, Ore. (6.4%). If buyers are waiting it out in some communities, they may be facing paying higher prices. Affordability speared to be the greatest factors in: Cumberland, Maryland, which had the largest price increase year-over-year through May (17.1%) is well below the national housing average of $212,300, at a little over $100,000. Other areas with double-digit price increases: Beaumont, Texas; Biloxi, Miss.; Salem, Ore.; Bismarck, N.D., Albuquerque, N.M., Salt Lake City, Utah; Farmington, N.M., and San Antonia, Texas.
Homes are up-sizing in Colorado. Our state now ranks fourth for percentage of residents in a home with four or more bedrooms. Both Boulder and Colorado Springs ranked in the top 10 metro areas. Utah ranks first. The southwest region, including Denver, is expected to lead the nation in population growth through 2020. Quality of life and workforce education levels will drive that growth, according to NAI Global. Hispanics account for more than a third of the state’s population growth in 2006, and now make up more than 20 percent of Colorado residents. Baby Boomers were the fastest-growing age group in the state. Denver couples are spending an average of $32,120 on their weddings, more than half of the U.S. median household income of $46,326. Metro Denver area employment increased by 10,800 jobs from March to April. Employment growth through the first four months of 2007 averaged 2.0 percent compared to the previous year. Leisure & Hospitality, Professional & Business Services and Education & Health are the leading growth categories. The Information sector is flat while losses are seen in Transportation, Manufacturing, and Construction. Nationally, employment growth is averaging a 1.5 percent gain. Colorado’s economy is now the seventh-largest in the nation with a 4.9 percent GDP growth rate outpacing the national average of 3.4 percent. Further impeding Denver’s real estate market recovery is the widening gap between asking prices and actual sales prices. The 90.4 percent selling price-to-asking price ratio means that some low-margin sellers will be writing checks at the closing table. The National Association of Realtors is projecting a turnaround in Denver home values, claiming Denver could see appreciation rates approaching 10 percent in 2008. Colorado’s SBA office reports a record year for 2006. Colorado SBA finance programs created 12,000 jobs, approved 2,612 guaranteed loans worth $500 million, and helped small businesses win over $4 billion in government contracts. Some 98 percent of all businesses in Colorado are classified as small businesses, and 60 percent have four or fewer workers. As many as eight “obsolete” buildings in Denver’s Cherry Creek North outdoor retail district will be demolished in the near future to make room for new structures, many of which will be classified as “mixed use.” Some are concerned about the fate of many of the area’s independent merchants. Exempla Healthcare is building a new $225 million, five-story tower at Lutheran Medical Center in Wheat Ridge. The addition is intended to expand OR and obstetrics capacity.
Total new production home sales (2,800) in the metro Denver area during the first quarter of 2007 were down 39 percent from first quarter 2006. Twelve months of sales activity through first quarter 2007 hit an 11-year low of 12,268 home sales. Overall sales volume decreased in all seven metro Denver market areas. Strong demand for new attached housing continues as sales of condominiums, townhomes and duplexes accounted for 40 percent of the market at year-end 2006 and 42 percent of all sales in the 12 month period through first quarter 2007. This is only the second time in the last 18 years that sales of attached homes accounted for 35 percent or more of total sales volume. Concurrently, this is the first time that the detached housing sector dropped under 60 percent in the market capture. New home inventory increased 6.0 percent from 3,291 homes in first quarter 2006 to 3,488 in first quarter 2007. The number of unsold new detached homes dropped 17 percent while the number of available attached homes was up 26 percent. In the resale sector when compared to first quarter 2006, the number of existing inventory homes (attached and detached) declined slightly. There were 22,943 total existing homes (attached and detached) listed for sale in the first quarter of 2007 compared to 23,908 listings a year earlier, a four percent decrease. The number of existing home closings (attached and detached) decreases six percent in the metro Denver area, comparing first quarter 2006 and first quarter 2007. During this time period, existing attached home closings declined three percent and existing detached home closings declined seven percent. Source: The Genesis Group.
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