All signs point to a spring housing market next year that will be as blistering hot as the past three years. Even though spring 2017 may seem a long way off now, it will be here before we know it. For those who are considering a move in 2017, now is the time to start planning and prepping your home for sale. This month’s newsletter includes a step-by-step guide to help you get started, but first the market data from last month.
The market posted solid numbers in September and appears to be building momentum as we enter the final stretch of 2016. In fact, this may turn out to be the most active fall market in years.
The volume of real estate sold across all Front Range markets increased 4.9% on a year-over-year basis in September, and decreased 9.4% on a month-over-month basis, less than the typical seasonal slowdown from August to September. The inventory of homes for sale increased just slightly to 1.8 months.
In Colorado Springs, sales volume increased 26.4% on a year-over-year basis in September and decreased 6.6% month-over-month. The supply of available homes in the Springs area remained steady at 1.7 months.
Predictions made by some this past summer of a slowdown in our market proved inaccurate. Looking ahead to next spring, expect to see a hot sellers’ market characterized by multiple offers, rising prices, and favorable terms for sellers as buyers compete for limited inventory. Aka, the same old story.
As a result, many homeowners are considering the possibility of selling. If you are one of those homeowners, the following are some recommended steps you can take now to get out in front of the process so you’re ready to go when the market becomes frenzied next spring:
- Get a good idea of the value of your home. You might be surprised how much your home has appreciated. The cumulative effect of five straight years of rising home prices is massive in many cases. Of course, you can start online with 8z.com, Zillow or other websites that provide automated valuation estimates, but for a more accurate analysis, you will want to consult with a professional such as myself. I will provide you with a detailed report specific to your home and the surrounding neighborhood. Just shoot me an email or call, and let me know you would like a Real Estate Review.
- Prioritize repairs and improvements. As part of my Real Estate Review consultation, I can help you develop a list of possible repairs and improvements. Our goal will be to make your home a “10 out of 10” in showing condition to maximize your sales price. The right tweaks to your home can add tens of thousands of dollars to its value. Oftentimes, the changes that have the most impact cost the least.
- Make the repairs and improvements. I can help you get started knocking off items on our punch list by recommending and coordinating with contractors, handymen, and other service providers that I know and trust to deliver quality work at a fair price. The winter months are a great time to have work done on your home. Contractors are not as busy and more available. Plus, why not get your house in tip-top shape now so you can enjoy it over the Holidays.
- Plan your next move. Need a bigger house? Looking to downsize? Want to move to a more rural setting? Before the frenzy of the spring market hits, now is a good time to get out and explore your options. There is nothing like actually visiting a neighborhood and going inside a few listings to help shape and refine your thinking about where you might want to live next. Not to mention, it’s fun to look at houses without any pressure. Just let me know if you’d like to see a few listings to see if they fit your idea of a potential new home.
I hope this plan is helpful for those who are considering a move. If you have no intention to sell, but would still like to have an extremely accurate snapshot of your home’s value and marketability, I would be happy to provide you with a Real Estate Review as part of the services I offer my clients.
Enjoy the fall colors!
Market Perception vs Reality
In 2009, many consumers feared that home prices would continue to lose value. Many experts agreed, comparing buying a home to “catching a falling knife.”
There were some, however, who saw light at the end of the housing tunnel. 8z Real Estate was founded in 2009.
8z is celebrating what it calls its Founding Day. Instead of the typical question and answer session on general housing market issues, this month with Lane Hornung, CEO of 8z, I asked him to reflect on how the real estate market has evolved since the company was launched.
Like the overall market, 8z has grown and prospered during the past seven years. It is now one of the 20 largest realty companies in the Denver area, based on revenues.
It has grown the number of Realtors six-fold and was recently named by the Denver Post as one of the area’s top work places. It has also expanded into Northern California.
John: Lane, what was it like starting a company when the Great Recession, caused in a large part by troubles in the housing market, was in full swing?
Lane: We were definitely still in the downturn. In some markets, the softening had started in 2007 and there was no clear end in sight. We started at a time when people did not think it was a great time to start a brokerage…or even buy real estate, for that matter.
John: Why start a brokerage during a dark time?
Lane: For the same reason you buy real estate in a down market. You have to think long-term. Long-term, we believed the market was going to improve.
John: How did starting 8z during a downturn shape the company?
Lane: It made us lean from the get-go. It also made us really focus on our true clients, buyers and sellers, not agents.
John: At 8z, you say “Real estate is broken. We’re fixing it.” Strong words. Can you elaborate?
Lane: That is our core purpose. We think that things can be better for the consumer, and for the real estate agent, for that matter. We spend a lot of time building trust with consumers. We want consumers to know that not all Realtors are equal.
John: I personally just witnessed a home that languished on the market and sold for about $100,000 less than comparably sized homes in the neighborhood. The original listing agent got the square footage and neighborhood wrong and didn’t insist the seller present the home in showroom condition. It languished when other homes around it in the same price range were experiencing bidding wars.That certainly seems to speak to your perspective that Realtors aren’t interchangeable.
Lane: One of the things we emphasize with consumers at 8z is that the goal is not only to sell the home, but to sell for top dollar. Your example shows that if the seller had maybe invested a few thousand dollars and it was marketed better, it would have sold for a much higher price.
John: Also at 8z, agents “farm,” or specialize in, a specific geographic area. Why is that important?
Lane: It’s hard to be an expert in every neighborhood, whether you are in Metro Denver or Northern California. We think 8zers add more value to the consumer by having a deep understanding of a specialized geographic market.
John: Lane, is technology, which gives consumers so much information at their fingertips, making real estate brokers obsolete?
Lane: Not at all. We think technology is great. It used to be that Realtors had all of that information in a black box and doled it out to consumers. Now, there is more transparency than ever when it comes to buying and selling real estate. We embrace it.
A consumer can go to places like Yelp and Zillow and quickly learn who the brokers are who do the best job.
At 8z, we make sure our brokers have the best technology to help their clients.
John: What is the biggest change you have noticed in the marketplace since 2009?
Lane: When we started, there were 35,000-plus listings on Metrolist (now REcolorado). Now, we have about one seventh of that. This chronic shortage of homes is driving just about everything else in the market. The market was a strong buyer’s market when we started and today it is a strong seller’s market. Both markets provide challenges to consumers. At 8z, we can help consumers navigate the market, no matter where we are in the cycle.