Dear Friends,
Most of us are great at looking back on historic data and "explaining" how the events affected the market. I am going on record with my 2009 forecast. Of course, all of the economic indicators for the world, nation, state, and the Durango Area are quite clear for 2009, so making a forecast should be easy (kidding).
Preliminary 2008 Market Statistics:
These statistics are from the Colorado Real Estate Network multiple listing service from January 1, 2008 thru December 22, 2008 for La Plata County:
Total of 846 Properties Sold...$323,264,214 Market Volume...$382,109 Average Price...95% Sold vs List Price, and 193 Days On Market.
Residential: 681 Properties Sold...$263,395,137...$386,777 Average Price...96% Sold Vs List Price, and 176 Day On Market.
Other sold properties include: 127 Land listings, 32 commercial properties, and 6 multi-family.
These are not final numbers for 2008, and the totals will be higher as sold properties are recorded for the last days of December. Also, please understand that other properties outside of the Multiple Listing Service are not in this review or forecast.
How do these numbers compare to the highest year of transactions ever?
In 2005, the total properties sold was 1,917 as recorded by our MLS service, and of those, 1,257 were residential, 480 land, 71 commercial, 8 multi-family, and 1 farm and ranch. In total, 56% fewer properties have sold, and of those, there were 50% fewer residential listings!
MARKET FORECAST FOR 2009...DRUM ROLL...!!!
ALL PROPERTIES: 950 SOLD (APPROXIMATELY A 10% INCREASE)
MARKET VOLUME: $332,500,000 (APPROXIMATELY EVEN)
AVERAGE PRICE: $350,000 (APPROXIMATELY AN 8% DECREASE)
RESIDENTIAL: 770 SOLD (APPROXIMATELY A 10% INCREASE)
MARKET VOLUME: $277,200,000 (APPROXIMATELY EVEN)
AVERAGE PRICE: $355,000 (SAME 8% DECREASE)
AVERAGE DAYS ON MARKET UP FROM AN AVERAGE OF 176 DAYS TO 190 DAYS
SOLD VERSUS LIST PRICE DOWN FROM 96% TO 94%
Commercial will have additional vacancy rates, more properties on the market, increased days on the market, and greater price pressure, as businesses are further stretched for revenue, and consumers continue to tighten their belts.
Land sales will continue to be slow, but they will quickly rebound in 2010. In 2009, we will start to work off some of the current residential inventory, and in 2010, we will return to builders providing new inventory, thus increasing their demand for vacant land parcels.
For residential, we will see demand increase, but prices will continue to be under pressure thoughout 2009. The demand change will provide the stimulous for an exciting 2010, because the increased transactions of 2009 will reduce the number of homes on the market. By 2010, the demand should outpace supply.
November and December of 2008 have some of the lowest market transactions that we have seen in 20 years, even though the population has increased by 40% in these two decades. These low transactions are a result of the October economic turmoil, and following the difficulties of the entire year of 2008. The beginning of 2009 will continue to be slow, because the contract activity has not increased through December, and that has a direct impact on the number of sold properties in the months following. If my forecast is correct, hang in there as we will start to see things improve, and hopefully by mid-year, we will all be more enthusiastic. We will look back at October 2008 as our emotional low, and in fact, the consumer confidence index was at an all time low in that month.
If you would like to have futher conversations on Durango Colorado real estate, please contact me, Don Ricedorff at The Wells Group 970-375-7014, don@frontier.net, or at my website at durangorealproperty.com.
Don Ricedorff is a licensed real estate broker in the State of Colorado, with 16 years of experience, and he resides in Durango Colorado. He has numerous real estate designations, which have provided him with an unparalleled education to assist his clients. The designations include:
CRS, Certified Residential Specialist
CRB, Certified Residential Broker
CCIM, Certified Commercial Investment Member
ABR, Accredited Buyer Representation
GRI, Graduate of Realtor Institute
RSPS, Resort and Second Home Property Specialist
CIPS, Certified International Property Specialist
SRES, Senior Real Estate Specialist
He is also an active volunteer in the community and his church. His highest aspiration is spending time with his wife, Janet, and his three children Kelly, Katie, and Kyle. His other interests include playing tennis, fly fishing, hiking, boating, and water skiing.
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