By Michael Canon and Lon Welsh, Your Castle Real Estate.
It’s still a great time to be a buyer in the condo market. Prices are at a three or four year lows in many areas. Interest rates on mortgages are still historically low. Combined with the first time home buyer tax credit, this should be a perfect storm for first time buyers to get the deal of a lifetime in the Denver real estate market.
The average condominium price in Metro Denver declined 4% between 2006 and 2007: from $187K to $180K. Homes dropped 3% in that time period. Looking just at the first two months of 2009 vs. the same time period in 2008, the price dropped 17%: from $170K to $141K. Homes dropped a similar amount in that time period.
These numbers will be slightly different than Metrolist, as they are just Denver Metro and don’t include outlying areas like Fort Collins, Colorado Springs, or Boulder.The price drop is misleading – not every condo dropped so much in the last year. The percentage of MLS sales that were either short sales or foreclosures increased from 44% to 54%. Since these distress sales are often at bargain basement prices, they drive down the average sales price. South Aurora Condo Prices: Many are in the Cherry Creek School district.
Last quarter, we reported that days on market (DOM) had been declining for condos, which should be a leading indicator that we are due for price increases soon. The DOM in January/February 2009 versus the same period in 2008 declined from 108 to 95. Another good sign that we’re near the bottom: the average discount declined from 3.5% to 2.9%.South Aurora Condo Prices: Many are in the Cherry Creek School district.
Some areas did better than others. The attached chart shows different neighborhoods in our region. Each region has the neighborhood’s name and price change in the last twelve months. We are comparing the twelve months of March 2008 through February 2009 to the twelve months right before that. There had to be at least ten sales in the last year for an area to be included. The numbers are more reliable in areas where there were more sales. Source: Your Castle Real Estate analysis, MLS data