Boulder area market marches on despite downturns elsewhere in nation

The latest housing statistics bode well for the Boulder County market. While how many homes have sold and prices are down in some communities, the market has remained stable compared with others around the country.

“It continues to amaze me, at least in most of our market area, that we continue to see real strength in pricing and value in residential real estate,” says Ken Hotard, senior vice president of public affairs for the Boulder Area Realtor Association. “I think this is more reflective of a market area in which we didn’t see real price run-ups and a lot of sub-prime and creative mortgages that got a lot of people in many parts of the country in trouble.”

The decreases in number of homes sold and prices between May 1, 2007, and April 30, 2008, is a reflection of slower job growth and something beyond the industry’s control, he says. Even though Colorado may see only a 1.5 percent increase in jobs this year – not as impressive as a 3 percent increase seen in years past – it should sustain the housing market. And the single-digit commercial vacancy rates along the U.S. 36 corridor, compared with 15 percent and 25 percent a couple of years ago, will also help support the residential market, Hotard says.

“We’ve seen this over the last couple of years, where sales volume has been the main indicator that we’re seeing the effects of the overall national economic downturn,” he says. “We have slower-than-usual job growth and we’re not seeing the buyers we have in the past. … But when you look at how prices are holding up, it says the Boulder area marketplace is still a good investment.”

Historical data, which shows a 6.2 percent annual appreciation rate in the city of Boulder between 1980 and end of 2006, supports that theory, Hotard says.

“That’s nothing to sneeze at,” he says.

For the same period, Boulder County had a 4.8 percent annual appreciation rate, which is not as impressive as the city’s but is still a solid return on investment, Hotard says.

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