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Sales and median sale price of million-dollar homes up in October from year ago

 After pausing in September, luxury home sales in the Denver metro area resumed their upward march in October with both the number of properties and the median sale price jumping from year-ago levels, according to Coldwell Banker Residential Brokerage, Colorado’s leading provider of luxury real estate services.

A total of 49 homes sold for more than $1 million in the Denver Metro Area in October, up from the 36 in September and 44 in October 2009. The median sale price also climbed 7.5 percent from a year ago to $1,315,000. But the median was off 7.6 percent from September’s price of $1,422,500.

Two other key indicators demonstrated an improving market: It took an average of 109 days to sell a million-dollar home in the region in October, down sharply from 157 in September and 131 a year ago; and sellers received an average of 93 percent of their asking price, up from 91.6 percent the previous month and 89.7 percent a year ago.

The figures were derived from Multiple Listing Service data of all homes sold for more than $1 million last month in the Denver Metro Area.

“The luxury end of the Denver Metro Area housing market has steadily improved over the past year, but as we saw in September, there will be setbacks along the way,” said Chris Mygatt, president of Coldwell Banker Residential Brokerage in Colorado. “It was encouraging to see the market bounce back last month, but there will continue to be challenges until the economic recovery picks up steam.”

For the entire market, sales of existing homes fell 28 percent last month from October 2009, according to Metrolist. One of the reasons for the drop in overall sales, Mygatt said, was that the federal tax credit, which was in effect last year, expired earlier this year.

Some key findings from this month’s Coldwell Banker Residential Brokerage luxury report:

  • The most expensive sale in the Denver Metro Area in October was a four-bedroom, six-bath 5,918-square foot home in Dillon that sold for $2.59 million;
  • Denver boasted the most million-dollar sales with 10, followed by Boulder and Greenwood Village with eight each, and Cherry Hills Village with four;
  • It took an average of 109 days to sell a million-dollar home in the area, down from 131 days a year ago and 157 days the previous month.

The Denver Metro Area Luxury Home Report is produced by Coldwell Banker Residential Brokerage, a specialist in high-end real estate sales. Through its internationally renowned Coldwell Banker Previews® program, the company is recognized around the world for its expertise in the luxury housing market.

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‘Smart Money’ Moving Back into Luxury Market

The Colorado housing market continued to rebound in 2010 from its recessionary lows, although strong economic headwinds and the end of the federal homebuyer tax credit combined to slow the pace of recovery in the latter months of the year.

Both home sales and the median sale price of all housing – single family and condominiums – rose steadily throughout the first half of the year as buyers took advantage of bargain home prices.  As summer turned to fall, sales began to ease but the median sale price continued to climb in most parts of the Denver Metro region.

According to Metrolist*, home prices in the six county Denver Metro area **rallied from about $202,000 as of October 31, 2009 versus $212,000 as of October 31, 2010, resulting in a 4.9% increase in home prices for the region.  Sold listings year over year showed a reasonable decline with 2009 figures reporting 3,715 listings sold versus a total 2,658 listings sold as of October 31, 2010, resulting in a 39% decrease in sold listings.  The dramatic decline in sold listings has much to do with the mid-year expiration of the federal first time home buyer tax credit as well as a stabilization of home prices.

Year over year (October 31, 2009 vs. October 31, 2010) the average days on market went from 49 to 54, respectively, resulting in a 10% increase.

An encouraging sign for the local housing market is that the upper end of the market has steadily been gaining momentum this year, though there has been an ease in recent weeks. Luxury homebuyers, including a number of relocating buyers, are becoming much more active and are occasionally buying the homes with all-cash offers.  One point of distinction for Coldwell Banker Residential Brokerage, too, is that we were once again recognized as the luxury home leader.  According to Metrolist, Coldwell Banker Residential Brokerage is the leading real estate broker*** in home sales $500,000 and above, accounting for 11.2% of all home sales in this arena.  The nearest competitor earned just 7.8% or a commanding 43.5% difference.

What’s causing the high-end to rally? Local agents say that there has been incredible pent-up demand among the moneyed class looking to buy. They’ve been out there scouting the market for quite some time but holding off until the time was right. Now that prices on luxury homes have come down sharply to levels unseen for more than a decade, they’re making the move. There is greater confidence among high-end buyers who believe that the market has hit bottom and prices will only rise from here.

Luxury buyers can hardly be blamed for thinking the market is offering more relative bargains than the Nordstrom’s half-yearly sale.  The luxury sector of local markets in Colorado have stabilized and rebounded off their recessionary lows.  Coldwell Banker Residential Brokerage’s latest luxury housing reports show:

  • A total of 36 homes sold for more than $1 million in the Denver Metro area in September, down from 46 a year ago and 71 last month.
  • However, the median sale price did climb more than 14% from August to reach $1,422,500 in September.
  • The median price was off 2.9% from a year ago.
  • The most expensive sale in the Denver Metro area in September was a six-bedroom, seven-bath 10,473 square foot home in Cherry Hills Village that sold for $7 million.
  • Denver boasted the most million-dollar sales with 11, followed by Boulder with 5, Greenwood Village with four and Cherry Hills village with three.

In the past, luxury homebuyers – the so-called smart money – are often the first to declare a market bottom and jump back in because they have the cash and the means to do so once they are convinced the time is right. These buyers are astute observers of real estate trends and financial markets, and are often the first to see turnarounds in the macro economy.  Their confidence in the market often leads overall consumer confidence.

It will be interesting to see if the rest of the market follows suit again this time.  While the economy here in the Denver Metro area and across the country certainly has been sluggish and unemployment levels remain stubbornly high, it is encouraging to see solid improvement in the upper end of the real estate market. Only time will tell if it catches on to the rest of the market.

Now, let’s take a look at local real estate:

Boulder: Buyer showings and listing activity has increased in the Boulder office and is a reflection of the current marketplace.  The closings are up due mainly to the end of the month time frame that this period resides in, however, active taking backups and pendings while lower than the previous two week period are actually at a high level for this time in the month of November.  The office and the local market appear to be lining up for a strong November closing and listing month when compared to previous Novembers.

Colorado Springs: Showings have shown a steady decline over the past few weeks.  Listings have also slowed down about 20% over the past two weeks, with under contracts holding steady probably as a result of the continued low interest rates.  With rates dropping back to historic lows (4%) it is a good time to check with your Coldwell Banker Realtor about buying or refinancing your current loan.

Denver Central: Activity is steady in all categories compared to the last four weeks. Clients are inquiring about lease options.  There have been some desperate sellers as well as some shaky buyers.

Devonshire: The warm weather has helped to bring out buyers again.  It’s been a slow few weeks, but now seems to be an activity time again.  The elections are over and that, together with the low interest rates, has created a burst of activity in showings & at open houses.  Most open houses last weekend had much better attendance than in the last few weeks.  Buyers still seem to be waiting for that “perfect deal” while sellers are not willing to move too much off of their list price.  Sellers right now are frustrated because even if their homes seem to be priced right, some of them are not being shown.  It’s a challenging market to say the least, but signs are out there that things will be steady in 2011.

Evergreen: Listing inventory has begun to decline as many unsuccessful sellers are withdrawing their homes from the market during the holidays.  Many will go back on the market in the spring of 2011 in hopes of having better success with improving market conditions.  Showoing activity is declining due to seasonal variations although good weather in the fall has kept many buyers out looking.  Several listings have gone under contract in the first part of November including two homes in the $900,000 price range.  Consistant with prior years, the number of showings typically decreases in the 4th quarter although the quality of showings improves as buyers still in the market are serious and motivated.

Larimer County: Oh the weather outside is frightful……..Well, Winter has arrived with the first accumulation of snow & with it, a somewhat chilly activity outlook.  That being said, from what’s been seen at the national level, the FED is apparently going to continue with plans for another infusion of cash to the system whereby interest rates will remain at unbelievably low levels. The increased buying power for folks looking to purchase has NEVER been better.  Prices in the mid-range seem to have stabilized & aren’t likely to drop substantially & are proving to be great values & popular sale items.  The high-end market has reached a level where mostly cash offers seem more common as the jumbo interest rates have come down substantially.  With prices of some million-dollar homes at more than 50% of what they were valued just a couple of years ago, there has been more robust activity in that arena than we’ve seen in quite a while.  Showings have dropped from the Summer highs – but remain steady as we creep toward Thanksgiving & have put the mid-term elections behind us.  For those still sitting on the fence – now is the time to take advantage; including Sellers looking to trade up.

Longmont: Buyers for upper end homes ($550,000+) are in the market to purchase.  Homes that are listed at a good value are experiencing multiple offers which means some Buyers must continue the process of looking.  Most Buyers are looking for great deals and are cautiously optimistic about this market.  Now is the time to find that move-up home.  Our inventory is holding steady.  Refinancing is very attractive right now.  Time to call your Realtor to ask about refinancing. You will need to know an idea of the current value of your property, and finding out about the feasibility of any remodel or looking at buying that dream home.

Parker: After a very strong September the activity has slowed down in October.  In Parker, sales decreased by 15% compared to October of last year and the inventory increased at the same rate from 689 to 810 homes. November however, looks strong again and we should exceed the number of sales from last month by a wide margin.  Our short sale and REO specialists report that it still requires additional time to close.

Southeast Metro: The market is buzzing with ready, willing & able buyers and the low, low interest rates make it a perfect time to buy.  The SE Metro office scheduled over 500 showings for our listings last week and we have over 90 properties scheduled to close in November.  This month our office successfully closed a Penthouse Condominium at a sales price of $1.4 million.  Houses priced in the $300,000 to $500,000 price range are seeing steady traffic & successful closings.  Properties priced below $200,000 are slow to move.  The luxury market is also experiencing steady traffic but longer days on the market.  It has never been more important for homes to be in excellent condition and priced at the current market value.

Southwest Metro: Showings have increased over the last three weeks.  We’ve had good results with our open houses as well as floor calls.  We’re also seeing an increase in our listing and buyers are starting to not only look but are becoming serious buyers.  The activity on our listings especially in the $350,000 to $500,000 price range has been very good.  There is a sense that sellers and buyers are ready to move forward and list their homes, get them sold and find something new.  Interest rates are great and at an all time low.  Buyers are finally coming to the realization that thus us the time to purchase.  There also seems to be an increase in the number of investors wanting to start buying homes.  Some are for fix & flip and some to use as rental properties.  This increased activity with sellers, buyers and investors is a very positive movement in the right direction.

Denver West: Activity has picked up.  Attendance at open houses is up substantially.  The $250,000 price range & below, open houses are flooded.  Buyers are seemingly getting off the fence, although some trepidation still exists at the higher price point.  On the other hand, we’ve placed several higher priced homes on the market and the activity has increased in the million dollar market.

Conifer: We’ve had two new listings for the month to date in November although inventory is declining as unsuccessful sellers are withdrawing their homes for the holidays.  Showing activity has held up well through October into early November primarily due to good weather although the quantity of showings is expected to decrease as we move into the holiday season.

Loveland: Beautiful fall weather has kept the Buyers looking.  Showings are stabilizing at the current level.  Good news, showings in the $400,000+ price range have increased.  Lenders are extremely busy with refinancing business, appraisers are busy with the same business.  Short sales continue to be a large part of the business in Loveland.  Listings seem to be holding steady….Sellers are pricing properties more competitively.

*Based on information from Metrolist and Information & Real Estate Services, LLC for the period LTM October 31, 2009 through October 31, 2010.  Specific comparison dates are October 31, 2009 versus October 31, 2010.  Data represents homes priced $0 to $99,999,999.  Due to MLS reporting methods and allowable reporting policy, this data is only informational and may not be completely accurate.  Therefore, Coldwell Banker Residential Brokerage does not guarantee the data accuracy.  Data maintained by the MLSs may not reflect all real estate activity in the market.  Owned and Operated by NRT LLC.

**Six county Denver Metro area includes: Adams, Arapahoe, Boulder, Denver, Douglas and Jefferson.

***Based on information from Metrolist and Information & Real Estate Services, LLC for the period 1/1/10 through 10/31/10.  Data represents homes priced $500,000 to $99,999,999.  Due to MLS reporting methods and allowable reporting policy, this data is only informational and may not be completely accurate.  Therefore, Coldwell Banker Residential Brokerage does not guarantee the data accuracy.  Data maintained by the MLSs may not reflect all real estate activity in the market.  Owned and operated by NRT LLC.

Coldwell Banker Residential Brokerage, Colorado’s leading real estate company, raised more than $21,000 to benefit the American Cancer Society during the company’s annual “Ride the Range” bicycling event held September 13-17, 2010.  The grueling 316-mile, 12-stage ride through nine Colorado counties was held in conjunction with Coldwell Banker Residential Brokerage’s September cancer awareness month.

“This year’s Ride the Range event was another incredible experience for participants and we all want to express our sincere thanks to our generous sponsors and support crews,” said Chris Mygatt, president of Coldwell Banker Residential Brokerage in Colorado.  “We enjoyed incredible views in the majestic Rockies and from Colorado’s high plains, plus great food and receptions as we stopped at all 14 Coldwell Banker Residential Brokerage offices along the Front Range.  Funds are still pouring in and I would like to encourage our agents and colleagues in the real estate business to donate additional funds to benefit the American Cancer Society.”

Those wishing to join Coldwell Banker Residential Brokerage’s fight against cancer and support the American Cancer Society, can make donations online at cbridetherange.com.  Each donation of at least $200 or more will receive a limited edition Ride the Range cycling team kit (jersey and bib shorts) or Coldwell Banker golf jersey whiles supplies last on a first-come basis.

When Coldwell Banker agents speak with their clients, friends, family and even their fellow Realtors, they hear the usual stories of buyers holding off due to fears of the slow economy or waiting for that perfect “screaming buy” to come along before purchasing. They also often hear about sellers not listing their homes because they wouldn’t get as much in this challenging market as their neighbors did a few years ago. However, some choose to look at the market in an entirely different way – focusing on opportunities.

There is valid concern regarding the nation’s high unemployment rate, the fragile economic recovery, and other economic stories seen on CNBC or read in this morning’s paper. Having said that, how is YOUR personal economy doing? While the nation’s economy is important, it’s not nearly as relevant to the individual as his or her own personal circumstances when it comes to buying or selling a home.

In many cases, buyers have secure jobs with good incomes and strong savings and investments. With home prices easing and mortgage rates near record lows, these buyers are personally in a good position to afford the home of their dreams – perhaps in a better position than they will be in the future when interest rates rise and home prices rebound. Conversely, many sellers have a great deal of equity in the home that they have owned for years and would walk away with a good profit. The reasons they may wish to sell are still there, bad economy or not – to move up to a larger home, or maybe downsize in retirement, or perhaps relocate to be closer to their grandkids.

It’s important for consumers to weigh their own “personal economy” against the nation’s economy when deciding whether to purchase or sell a home. It’s easy to get caught up in the daily drumbeat of economic news. It’s impossible to turn on the TV or the radio, or read a paper without the latest economic minutia. While most experts agree that the U.S. economy is recovering and the risk of a “double-dip recession” appears over, some days it still feels like two steps forward and one back.

Remember, what really matters in an individual’s investment decision isn’t the latest jobless figures or manufacturing orders or even the Case-Shiller index, it’s the personal circumstances of that individual. Assuming “personal economy” is reasonably good, it may be time to swallow fears and take advantage of this window of opportunity to buy a home.

There’s an old saying that you make your profit on real estate when you buy, not when you sell. It’s a lot like the “buy low, sell high” philosophy of investing in stocks. While no one questions that there are economic challenges out there in the market, there are also tremendous opportunities. By the time all of those macro economic concerns have been lifted – when the “all clear” bell rings again – it’s doubtful the same opportunities will be around in terms of prices and mortgage rates. “Personal economy” may just be the best indicator when considering whether to make a real estate move now rather than later.

Coldwell Banker Residential Brokerage, Colorado’s leading real estate company, is once again sponsoring the company’s annual Winter Coat Drive to benefit troops and veterans. During the months of October and November, Coldwell Banker Residential Brokerage is teaming up with families, friends and clients to donate clean, new, or slightly worn coats and warm clothing to our troops, veterans and their families in Colorado.

“With fall in the air and winter just around the corner, now is the perfect time to donate unwanted coats and warm garments to the families of our military personnel and veterans as part of our annual Winter Coat Drive,” said Chris Mygatt, president of Coldwell Banker Residential Brokerage in Colorado. “Together we can make a difference in the lives of men and women who are serving and have served our great nation. Thanks for your support.”

Donations may include winter coats or ski parkas for kids and adults, professional wool coats or blazers, and snow boots or goulashes for kids and adults. Warm hats, scarves, overcoats, gloves, warm blankets and sunglasses may also be donated. Please drop off bagged donations to any Coldwell Banker Residential Brokerage office along Colorado’s Front Range, or contact one of the company’s real estate professionals to arrange a personal pick up at your home.

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