Real estate experts: Boulder housing market improving

By Peter Budoff
Camera Staff Writer
Posted: 11/19/2009 11:14:24 PM MST

The national and local real estate market is showing signs of improvement, but a full recovery will depend on restoring consumer confidence, housing experts said at a Boulder forum Thursday.

Boulder remains somewhat insulated from the national economic struggles, Scot Smith, a broker with The Colorado Group, told the crowd at the second annual Boulder Valley Real Estate Conference and Forecast at Boulder's Millennium Harvest House.

"This is a good place to be," Smith said. "When the full recovery begins, it will probably begin here."

Smith said that the presence of large local companies and continued strength in the energy industry and others will continue to help stabilize the Boulder economy.

Commercial occupancy should increase slightly throughout Boulder Valley in 2010, while the area should remain relatively insulated from the national wave of foreclosures, Smith said. Office vacancies fell to low of 12 percent in 2009, not as high as some predicted.

Smith noted that in addition to governmental agencies -- which were the largest purchasers of commercial property this year -- the Boulder commercial real estate sector has been boosted by an unlikely industry: medical marijuana dispensaries.

"We can only hope marijuana never gets regulated, so it can lead us out of this recession," he joked.

D.B. Wilson, managing broker of ReMax, said the residential housing market through the beginning of 2010 will continue to favor buyers, with affordability at an all-time high.

But prices, interest rates and mortgages are still likely to fluctuate through next year, and true market stability won't come until consumer confidence is restored, several speakers said.

Sharp declines in wealth and increases in unemployment have dropped consumer confidence to near-historic lows, said Patti Silverstein, the chief economist of the Metro Denver Economic Development Corporation.

Confidence should improve as the economy does in 2010, but the improvement will be slow, Silverstein said.

"The recession from a technical standpoint probably ended in the third quarter of the last fiscal year," she said. "We will keep moving out of the recession but at an anemic pace."

Boulder Lofts

Lofts in Downtown Boulder Move Quickly
New buildings featuring mixed uses on the downtown Boulder landscape have become a common occurance. First it was Boulder One Plaza, then the St. Julien, then 1505 Pearl and 1155 Canyon. Construction on The Walnut at 1655 Walnut Street is slated to begin this month, and numerous other projects are in the planning process. This upscale market – which includes a reported appreciation rate of as much as 50 percent, immediate access to Pearl Street Mall’s restaurants and shops, and proximity to hiking trails, all mixed with a new found hint of big-city life – is attracting more Boulder residents and vacationers. The developing urban environment, which still encompasses the hometown feel and sense of community Boulder is known for, presents a compelling argument for buyers to explore the options downtown living offers.

With an extremely limited supply and a huge demand, these condos are selling fast: nine of 34 units of The Walnut are already under contract. Prices of units in the building range from $500,000 to $3.5 million. The inventory of lofts at 1155 Canyon, priced between $400,000 and $5 million, sold out within a week. Purchasers in this market range from young professionals to “downsizers” and vacation-property owners. With high rental rates and excellent appreciation, downtown condominiums offer great investment potential, as well. Because of the discrepancy between supply and demand, this area of the market is insulated from the rest of Boulder and has remained strong even while new construction everywhere else has slowed. Things here are only getting better: the developers are striving to create a higher-quality product, incorporating green building practices, and bringing in acclaimed architects such as Mark Harbick from Huntsman Architectural group in San Francisco to design The Walnut.

The trend in Boulder is moving toward that of a vacation destination with limited prime real estate available, so now is the time to buy. Do not miss the chance to own a piece of truly luxury living in downtown Boulder before it’s too late. It is an exciting time to buy downtown Boulder real estate. Contact us to assist you in exploring the benefits of downtown luxury condominium living today!

By RE/MAX of Boulder, Inc.

Boulder Green Points

City of Boulder looks to update Green Points Program

The city of Boulder was one of the first jurisdictions in the nation to impose a residential “green” building code. Now it’s looking to raise the green bar even higher.

The city’s Green Points Building Program for residential construction, which encourages homeowners to include cost-effective and sustainable remodeling and building methods that protect the environment, hasn’t been updated since 2001. The program applies to all new residential construction and additions and remodels larger than 500 square feet.

Elizabeth Vasatka, environmental coordinator for City of Boulder’s Office of Environmental Affairs, said staff is proposing the city:

· Adopt the 2006 International Energy Conservation Code and require new homes be 50 percent more efficient than the code’s standard.

· Require homeowners remodeling or adding to their house get a home-energy audit before they get a building permit. The audit, remodeling or adding to their house to get a home-energy audit before they get a building permit. The audit, which can be subsidized through the city-sponsored Residential Energy Audit Program, will educate homeowners about energy-saving opportunities they can incorporate into their project. City staff is proposing to make some of those opportunities mandatory.
· Require remodeling or addition projects to meet standard building codes and earn Green Points to receive a building permit.
· Require contractors donate, reuse or recycle a minimum of 65 percent of an existing structure and 50 percent of construction waste by weight on a new job site.

“We’re somewhat helping folks future-proof themselves for the next 20 to 30 years,” Vasatka said.

Staff is recommending the city help market homes that have met or exceeded the requirements of the program by assisting homeowners in obtaining the federal tax credit; providing a certificate indicating Green Points required and achieved; and serving as a liaison to the Boulder County MLS real estate listing agency to implement Green Points or green building features into the database to assist in marketing properties, Vasatka said.

The city council will vote on the changes in mid-November. If passed, the new requirements will likely become effective in January.

For Mary Lou Robles, an architect and sustainability consultant with Studio Points in Boulder, it’s about time the city upgrades the Green Points Program.

“It’s not a choice anymore,” she said. “There have been enough shifts in the environmental climate that it’s up to us to rethink what and how we build. It’s only logical that the jurisdictions rethink their role and the requirements they place on building.

“There (are) benefits to be had by doing the right thing. (The requirements are) all completely doable and they’re all within economical reach.”
But Kim Calomino, director of Built Green Colorado, Boulder city officials do not know what the 2006 energy code can accomplish, so they shouldn’t try to raise the bar and instead should wait for more green-friendly standards now being worked into the national building code.

The market – not government regulations – should drive green building, Calomino said.

“There’s a fine balance between setting requirements that are cost effective, keeping homes affordable at point of purchase and over the long haul, and requiring homes to be built in such a way that it knocks them out of reach for a lot of folks,” she said.

By RE/MAX of Boulder, Inc.

McMansions

McMansions on the Chopping Block?
Residents of unincorporated Boulder County may soon no longer be able to build homes as big as their dreams.

The county commissioners are expected to vote this fall on regulations they believe would mitigate the impact of large homes on the county’s rural character and resources.

At the July 10 meeting, the commissioners asked staff to draft regulations that would prevent homeowners from building homes on the plains bigger than between 6,500 and 7,000 square feet or from adding on to existing homes to make them bigger than that without purchasing development rights/credits. For the mountains, residents would have to purchase development rights/credits to build or expand homes that would exceed between 4,500 and 5,000 square feet. Both proposed sizes include garages and basements and are about twice as big as what was previously proposed.
The move comes as the median size of a new home in unincorporated Boulder County grew from 5,189 square feet in 2004 to more than 8,000 square feet this year.

The commissioners’ argument is that bigger homes – even those built using green building techniques – are still not sustainable because of the amount of resources associated with both their construction and on-going use, said Michelle Krezek, manager of special projects for the county. As such, those homeowners should have to off-set that resource use by buying development rights/credits that allow the county to purchase open space elsewhere.

County staff members also are researching unique thresholds for Special Character Areas, such as Gold Hill, Eldora and Allenspark, as the board wants to provide them with particular protection, Krezek said.

The commissioners also want to allow property owners who either have or want smaller homes the opportunity to not only sell a portion of their “unused” square footage for a one-time payment, but also have lower ongoing tax assessments on their smaller homes, she said. Doing so will diversify the housing stock and allow people of “varied means” to own homes in Boulder County.

Krezek said the growth of the median size of new homes, along with homeowners substantially adding onto a smaller home – such as building a 6,000-square-foot addition on to a 2,000 square-foot home – or demolishing an existing home to replace it with a much bigger home, is affecting the diversity of housing in the county.

However, the proposed regulations are meeting a fair amount of opposition. Many homeowners, concerned with how the regulations will affect their ability to build their dream home or add on to their existing homes, have spoken against the proposal.

But Ken Hotard, senior vice president, public affairs, of the Boulder Area Realtor Association, said the issue goes beyond individual property rights to the appropriate process for addressing the problem.

“I frankly don’t know whether they should or shouldn’t do something like this,” he said, noting the county already has significant control over home size through zoning, planning review and other regulations.

“Tools exist today that if they were revised they could materially affect home size in an appropriate context that is in relationship” to neighboring properties and the character of the area, Hotard said. Go to http://www.baraonline.com/news/insite/y2007/july/wk12/n1181770336_360399 for more of Ken Hotard's position on the proposed "McMansion regulations.

By RE/MAX of Boulder, Inc.