How is the Real Estate market doing as we are starting into 2021?
CU Boulder's Leeds School of Business published the Economic Outlook for 2021 in December which summarizes their data about the development in real estate in Colorado in 2020. It explains exactly what we experienced in real estate in the course of the year. Here is an excerpt of the report, page 80; (in case you are interested in digging deeper, here is the link to the full report
"Colorado Real Estate Market
The first quarter of 2020 started off with what appeared to be a continuation of the trends from 2019. That changed drastically as the effects of COVID-19 began
to show in late February and March. In April and May, most real estate buying and selling ceased. As a result, Colorado real estate professionals predicted a difficult year for the Colorado real estate market. However, when the Colorado real estate market re-opened in May, events that had been occurring over the last eight years such as household migration to Colorado from the major coastal markets (New York, San Francisco), companies expanding Colorado operations (Amazon and Charles Schwab) and/or re-locating their headquarters to Colorado (Palantir, VF Corp), and individuals choosing to work remotely from more spacious confines in Colorado, accelerated.
Nationally, the housing market continues to be robust in spite of the headwinds created by the COVID-19 pandemic. National home builder confidence is at an all-time high. The one constraining factor in the market is lack of supply, which should keep upward pressure on home prices nationally."
Here is a very vivid graph from Realtor.com which shows briefly how the housing prices developed last year. The graph relates to the housing prices nationally and Boulder County is no exception. Low inventory and high demand led to an appreciation rate of more than 10% in fall 2020. It is expected that this development continues in 2021 with an appreciation rate of 7% or 8%.
Overall homeownership grew in Colorado in the course of the pandemic and a pattern of moving out of the cities into the countryside could be observed. Condos in Downtown Denver are sitting on the market longer than before but the demand for mountain homes increased dramatically. Double the amount of mountain homes were sold in 2020 compared to 2019, which led to high appreciation rates. Not only the mountain regions were highly desired, other suburban areas in Colorado experienced very high demand too. The highest appreciation of homes happened in 2020 in Pueblo, CO.
THE 2021 COLORADO ECONOMIC SUMMIT
The Colorado Economic Summit, organized every year by Coldwell Banker will take place this year on February 3rd from 4pm to 6pm MST. Please watch out for a separate email with an invitation to attend this virtual event if you are interested to learn more about what to expect in regard to the economy and the real estate market in 2021.
Thinking of buying or selling a home this year?
Despite all the uncertainty which we experienced within the course of the last year and the unexpected events happening right now, the housing market is one thing that's been consistently strong and all indicators show that this will continue into 2021.
This shows clearly it will be a good year to sell. What about buying a home in uncertain times? As a home buyer you always wish to find the "right" time to buy your home and earn good appreciation over the time. The good news is that Boulder and Boulder County have such a robust housing market that even if there would come a time of low or slightly negative appreciation like in 2008/2009, the recovery was always fast and permanent. So, I recommend focusing on your personal life and financial situation to determine whether you are ready to buy and not be too bothered with thoughts about the perfect market.
Please don't hesitate to contact me if you would like to talk more about the market, how to prepare a home for sale or any other real estate needs you have.