Real estate market continues to crawl along; recovery time still unknown

Cooler weather has brought an end to summer as well as the hope that the increase in home sales the hot season usually brings was just delayed.

For the second month in a row follow a promising June, statistics for home sales and prices in Boulder County were anything but. According to statistics for August, 303 single-family homes sold in July, down from 372 a year ago, and 110 attached homes sold, down from 141 a year ago. Average sales prices dropped in every Boulder community except Broomfield and the mountains, though Broomfield, Erie and Louisville all saw increase in the median sales price of homes sold.

Through the end of July, 3,041 single-family homes sold, compared with 3,889 the previous year, and 1,184 attached homes sold this year, compared with 1,416.

“We’ve seen a slowdown in sales activities over the last couple of years and those trends are continuing,” says Ken Hotard, senior vice president of public affairs for the Boulder Area Realtor Association. “The real estate market is a victim of a trifecta of things: economic weakness, lending difficulties and low consumer confidence. People are not interested in making huge financial decisions at this time unless they have to.

“I was disappointed that we didn’t continue that growth in sales trend that we picked up in June,” he added. “But as you look around, you can certainly explain it. Who’s to say when that’s going to change?”

The market had had good activity and many people are in a position to take advantage of competitive prices and a solid inventory. Buyers are making offers but a larger percentage than usual are not making it to closing for a variety of reasons - those included in the "trifecta" of issues, Hotard says.

Lack of job growth is still an issue, though Colorado is doing better than the nation, but the state legislature now must cut another $240 million from this year's budget with deeper cuts expected in 2010, he says.

“It’s hard to peer into the future and get a good sense of when things are going to turn around,” Hotard says, noting he still thinks the second half of 2010 will have the potential for the economy to stabilize and turn the corner. “Depending on who you talk to, it’s gloom and doom forever, or we’ve already hit bottom and we’re beginning to correct already. I don’t think the picture is that clear on either account. The indicators are confusing at best.

“There’s demand,” Hotard adds. “When the time is right, things are going to move fairly briskly.”