What to Expect in the Real Estate Market in 2020
The real estate market cooled off a bit in 2019. While it still remains a “Sellers” market, it wasn’t as frantic in 2019 as it has been for the last several years. Instead of price appreciation of 10%/year, as has been the case recently, price appreciation in Boulder County was 3% for a single family home. It also took a little longer to sell a home in Boulder County in 2019, rising slightly from 56 days to 59 days. We also saw a big decrease in multiple offers and homes selling over list price on a regular basis. It used to be that for any nice home that came on the market, Buyers had to be ready to pay over list and compete with 5-10 other Buyers for the chance at buying the home.
Here are some basic statistics for Home Sales in Boulder County for year end 2019, compared to 2018
New Listings - Up 8%
Sold Listings - Up 7%
Median Sales Price - $584,363 - Up 3%
Percent of List Price Received - 99% - Down .6%
Days on Market Until Sale - 59 Days - Up 5%
Inventory of Homes for Sale - Down 8%
Looking at these figures, you’d still say that it’s a strong market and more favorable to sellers than buyers. It’s just not as extreme as it has been in recent years. There were more listings, which is much needed, and more sales in 2019. Prices were up, though modestly. Overall, you could say there’s a trend in the market that’s shifting ever so slowly towards balance, instead of being so strongly in the sellers’ court.
However, notice that the inventory of homes for sale actually declined in 2019, finishing the year with 8% fewer homes for sale than at the end of 2018. That throws a wrench in the works, if you’re a Buyer. 2018 was the first year of the last 10 years where inventory levels rose significantly. Inventory is one of the main drivers of price appreciation. As you can imagine, when there are more homes for sale, Buyers have more to choose from and prices start to decline. The general expectation for 2019 was that inventory would continue to increase and prices would drop. Prices did drop but so did inventory! Without inventory levels going up, it’s hard to imagine prices going down significantly.
While we can’t draw firm conclusions from the most recent data we have from January of 2020, they indicate that inventory levels are continuing to decline. Surprisingly, the inventory of homes for sale is 26% lower than January of 2019! As you’d expect given that, prices were up 6% from January 2019. We’ll have to see where that goes in the coming months. In addition, the ripple effects of the Corona virus are beginning to flow through our lives and our economy, so that’s another unknown factor in the real estate market in 2020. So, we shall see how things pan out in 2020.