Wednesday, February 25, 2009

Updated Colorado Home Price Trends compared to troubled states

Colorado remains in much better condition than most other states and far better than in the 5 key states that are driving the mortgage crisis. Volume in Denver has picked up considerably as people have become more active in buying foreclosures (lower average price than a non-distressed sale which does pull down average prices but will improve market health by reducing inventory) which I believe explains some of the dip in the graph below. I also read today that cash deals are way up which shows that the smart money is moving back into the market.

The old saying about how all real estate is local is very true. Nationwide troubles have impacted most markets but at the same time many markets are doing better than most new would lead us to believe and many of them are turning and starting to improve despite declines in the national averages. A good example of how Steamboat is different is that our foreclosure rate was 0.3% at the end of December which is dramatically lower than the 5-6% we see reported in the national news.

Colorado is the blue line in this first graph and red in the second one. The word I hear from several credible sources in Denver is stabilization and some improvement as inventory is going down. Original graph when this post was first done

The Steamboat Voice of Reason Blog had the audacity (many news sources find it more profitable to cover only the bad news) to post credible data from the Federal Reserve Bank of St. Louis showing the chart above that compares relative home price changes in California, Florida and Colorado. Colorado is the red line and it shows pretty clearly the differences between our market and the 5 states where the large majority of the housing crisis is playing out as represented by California and Florida. It is nice to see data that shows this so clearly from such a credible source. I am not saying we don't have issues in Colorado or the other 44 states but it is nice to see how individual states are doing and understand local markets better.

I follow this very closely and even I was surprised by the differences between these states and how good Colorado looks after so much one sided news coverage.

If you would like to know more, see if there are opportunities that makes sense from you in Steamboat or talk about how this affects your situation just give me a call anytime at 970-819-6930.

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