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When I finished researching this month’s graph, one number stood out. The number is 480 and it’s represented on the graph by the red line in the Longmont section. It is the grand total of all single-family homes sold in Longmont so far this year. It seemed pretty low so it got me thinking of how it compares to years in the past. Research mode kicked in and I pulled total single-family sales in Longmont for past years. 2023 represents the LOWEST all-time sales total in the history of the MLS!! I went all the way back to 1996 when there were zero (no data). Even in it’s first year of adoption of 1997 and before a lot of new home sales kicked in, there were 569… 18.5% more! The next lowest year was 2009 at 500 and that was just after the mortgage meltdown when interest rated hovered around 6.2%.
This discovery led to even more rabbit holes to sneak down. I had to cut myself off at one point. The most complete picture I could come up with was a study of closed single-family and attached homes, combined, from 1997 to 2023 for all of Boulder, Weld and Larimer counties. While the results aren’t as dramatic, they still can put our current low sales total in perspective. 1997 and 1998 were quite low since MLS adoption was still building. The next lowest group is, as expected, the range between 2008 and 2012 when we were going into and coming out of the great recession (only thing worse was the great depression). And then, the low sales total of 2023 was lined up right behind them.
During the time period of time between 2009 through 2012, interest rates were below 5% and as low as 3%. Back then, even low interest rates and low prices couldn’t convince people to buy a house. Count yourselves as lucky, I had written two whole, boring paragraphs on the laws of supply and demand, but those weren’t nearly as interesting. Writing them reminded me that these laws can’t always factor in human nature, which is a big part of the real estate market, which also has large, incalculable components of emotion, fear and optimism of our outlook on our future wealth decisions.
Now to where it all began. The graph. It depicts Year-to-Date (YTD) closed sales (unit volume, not price) of single-family homes in five front range cities over the past six years. The black line is the average number of YTD closed sales for 2018 through 2022. The red line represents YTD closed sales this year. The negative number in the callout box is how far single-family, closed sales have slumped this year compared to the average.
Longmont Area Real Estate Stats July 2023
Boulder Area Real Estate Stats July 2023
Northern Colorado Real Estate July 2023
The statistics are quite astonishing. Longmont, Loveland and Greeley have nearly identical declines. The decline this year compared to the five-year average in Ft Collins is within four percentage points of the first three, hardly noticeable in the big picture. But the 10% difference between the first group and the most expensive housing market on the Front Range, Boulder, is remarkable. And, even though their average and median price declined this month, the YTD prices are UP in both categories. Boiled down, this means the most expensive market in the area is acting the most normal in the most abnormal market we’ve seen in 15 years.
Numbers are fun to a stats geek like me. The most fun number I’ve seen in a while is the EXACT same median price of an attached dwelling in Longmont from last July compared to this July. Almost as fun is the nearly identical average prices from last year and this. And, the only real number worth commenting on in the whole report is the meteoric rise in Longmont attached days on market. This increase is completely due to five new construction townhomes that averaged 262 days on market. Without them and their skewed number, the average would be a pedestrian 42 days and we wouldn’t even be having this conversation.
Lastly, our guest report is from the Johnstown/Milliken area. I get asked about this area often. If it interests you and you have a need to see it regularly, it’s always included in my Northern Colorado report, which can be found in one of the report links in the middle of this analysis. But, as you can see, this smaller market is functioning the same as the rest of the Front Range… decreased sales, slightly increased days on market and nominal price fluctuations.
My current takes on why this market is still functioning properly under some very abnormal circumstances. First of all, demand is steady because there are always people who have to move because of a job, school, marriage, divorce, downsizing, etc… those are a majority of the people buying and selling. Secondly, other people are realizing that 7% mortgages are here to stay for a while. Basically, they are getting used to the idea of paying last years’ housing prices, paying aa higher interest rate over the next couple years, and hope rates come down a fuzz in the future so they can refi. It’s a pretty good strategy because timing the market is so hard to do and who knows when interest rates will come down and home prices start to go up again. Lastly, you have the rest of the world who don’t have to move, so they aren’t, and you can’t make them. Fine. This is what you as an agent or lender has to work with. Use your time and effort to find more people who are in the first two groups. Simple.
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