sf report april 2010

THE SILVER FERN REPORT: BoulderAn analysis of real estate market conditions in

Boulder, Colorado

Real Estate AdvisersBoulder, Colorado

Phone: 303 586 1241www.silverfernhomes.com

Make a Smarter Real Estate Decision

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Legal

This presentation was prepared exclusively for the benefit and use of the Silver Fern Homes clients in order to assist their study of real estate market conditions. This presentation is for discussion purposes only and is incomplete without an in-person, oral presentation by Silver Fern Homes. This presentation reflects our views of prevailing market conditions on this date, which are subject to change. Silver Fern Homes recommends careful and complete due diligence before buying or selling real estate or other investments. The following presentation is not to be construed as legal, tax, or investment advice. Silver Fern Homes will not be held liable for investment decisions derived from this presentation. Previous market performance is not a guarantee of future results and there is financial risk associated with buying or selling property. Consult with your financial, legal, and real estate advisers before making an investment decision. The data in this presentation was obtained by private and public sources, without independent verification.

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The TeamOsman Parvez: Co-Founder and Associate Broker. Osman’s professional experience includes investment analysis, real estate development, and investment banking. He also loves being in the wilderness and has research experience studying the impacts of climate change. Osman holds an MBA in finance and a B.S. in Biology Email: [email protected] ph: 303.746.6896

Dallice Tylee: Co-Founder and Managing Broker. She holds a GRI and is a Certified Negotiation Expert, EcoBroker, and Accredited Staging Professional. A native of New Zealand, Dallice's attention to detail and thorough, disciplined approach comes from previous professional experiences in health sciences. She is passionate about interior design and landscaping. Email: [email protected] ph: 303.746.6765

Mia DeLong: Associate Broker. Mia loves historic home restoration and a creative eye for home improvement. She has six years of real estate experience and brings expertise from her experience in product management in the service industries. She holds a BBA in Marketing from UW-Wisconsin and her interests include running, biking, cooking, reading and photography. Email: [email protected] ph: 303.717.2241

Crystal Callipari: Associate Broker. Crystal’s experience as a real estate investor and home builder provides unique insight on buying, selling and marketing strategies. Prior to joining Silver Fern, she was a frequent client of the firm, giving her perspective on the quality of service clients should expect from their broker. Crystal has lived in Colorado for over 13 years with her husband. She has two grade school aged children, one of whom is a competitive figure skater and the other a black belt in martial arts. Email: [email protected] ph: 720.841.2701

Robbin Merta: Administrative Assistant. She has a B.F.A. in graphic design, experience owning several small businesses, and is studying for her Realtor's license. Her strong interest and experience in home renovation, both personally and professionally, is a practical complement to the Silver Fern team. She is a stained glass artist who also enjoys volleyball, cooking and martial arts. Email: [email protected] ph: 303.993.6139

mailto:[email protected]




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Table of Contents

• Boulder Single Family Houses (Detached Dwellings)– Notable Sales (Entry Level to Luxury Living ) – Inventory and Sales Volume– Sales Volume (Last Six and Twelve Months)– Days to Offer and Median Price

• Boulder Single Family Town Homes and Condos (Attached Dwellings)– Inventory and Sales Volume– Sales Volume (Last Six and Twelve Months)– Days to Offer and Median Price

• Client Analysis: Historic Appreciation In Louisville (3 bedroom, 2 bath homes)

• Case Study: Price It Right or Else• Overall Market Conditions• On the Horizon• How to Get a Great Deal

Boulder Single Family HousesDetached Dwellings

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LUXURY

34 Boulder View Lane

Key Statistics: 8 Bed, 9 Bath12,603 SQFT

Sold: 4/14/10Days On Market: 3,504Sold: $4,100,000Percentage of Original Asking Price: 73%

Originally asking $5.6MM, this trophy estate chased the market downward for nearly a decade. This is why we obsess over pricing our listings right.

Boulder: Notable Sales

ENTRY LEVEL

30 S. 32nd Street


Sold: 3/31/10Days on Market: 84Sold: $435,000Percentage of Original Asking Price: 97%

Completely remodeled and stunning. Likely sets a price record for remodeled ranches (without massive SQFT expansion) in Martin Acres.

MID RANGE

2627 Pine Street


Sold: 3/03/10Days on Market: 318Sold: $549,000Percentage of Original Asking Price: 80%

Completely renovated and lovely, but most buyers couldn’t overlook the compromised location between Folsom and 28th.

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Boulder: Inventory and Sales Volume

Inventory:

• There were 451 houses on the market in March, down 8.5% from the year before, but still up substantially from the long term average.

• The 2009 inventory bubble appears likely to return this year. Stay tuned.

Sales Volume:

• 50 houses sold last month, an increase of nearly 43% from last year.

April Preliminary Data:

• Early data shows 507 houses in inventory and sales volume currently above 50 properties. Most closings happen at the end of the month, so sales volume will be higher and possibly exceed the average.

Boulder Inventory

300

350

400

450

500

550

600

650

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Average ('04-'08)

2009

2010

Data: BARA© Silver Fern Homes

25% above average

Boulder Sales Volume

0

20

40

60

80

100

120

140


Average ('04-'08)

2009

2010

Data: BARA© Silver Fern Homes

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Boulder: Periodic Sales Volume

• During the last six months, sales volume has increased noticeably. This is a positive sign but likely driven by temporary tax incentives.

• Over the past several years, sales volume has been dropping steadily.

Boulder Home Sales VolumeLast Twelve Months

10

210

410

610

810

1010

1210

2005 2006 2007 2008 2009 2010

Sales Volume Data: BARA© Silver Fern Homes

Boulder Home Sales VolumeLast Six Months

10

60

110

160

210

260

310

360

410

2005 2006 2007 2008 2009 2010


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Boulder: Days to Offer and Median Price

• The median number of days before a sold property received an accepted offer was 64. This is slightly less than the same period a year ago and lower than the long term average.

• The median sale price was $490,000 in March. Because our market contains a diversity of house prices, it’s normal for median sale prices to swing dramatically from month to month.

Boulder Median Sale Price

$400,000

$450,000

$500,000

$550,000

$600,000

$650,000


2008 2009 2010 Data: BARA© Silver Fern Homes

Boulder Days to Offer

0

20

40

60

80

100

120

140

160


Average 04-08

2010

2009

Data: BARA

© Silver Fern Homes

Boulder Town Homes and CondosAttached Dwellings

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Boulder Attached Dwellings: Inventory and Sales Volume

Inventory:• 449 homes were on market last month,

down 5% from last year.

• This excludes shadow inventory at new developments like the Peloton.

Sales Volume:• 73 homes sold, up 40% from the

previous year.

• Sales volume in March was higher than the long term average.

April Preliminary Data:

• 59 properties have closed as of April 28th. Because most real estate transactions close at the end of the month, this number is likely to rise substantially, perhaps continuing to exceed the long term average.

• Inventory in April stands at 499 units, slightly lower than the long term average.

Boulder Attached Dwelling Inventory

300

350

400

450

500

550

600


Average 04-08

2009

2010

Data: BARA


Note: several developers are not listing full inventory on the MLS. True inventory is substantially higher.

Boulder Attached Dwelling Sales Volume

0

20

40

60

80

100

120


Average 04-08

2009

2010

Data: BARA


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Boulder Attached Dwellings: Periodic Sales Volume

• Sales volume peaked in 2006 and has been dropping steadily for the past several years.

• During the last six months, sales volume has picked up noticeably. It remains to be seen how much of this is “move forward” buying by those seeking to take advantage of buyer tax credits.

Boulder AD Sales VolumeLast Twelve Months

10

110

210

310

410

510

610

710

810

910

2005 2006 2007 2008 2009 2010


Boulder AD Sales VolumeLast Six Months

10

60

110

160

210

260

310

2005 2006 2007 2008 2009 2010


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Boulder Attached Dwellings:Days to Offer and Median Price

• The median number of days before a sold property received an accepted offer was 139. This is up significantly from 90 last March and a continuing trend of longer days on market.

• Note the lowest average days to offer falls at the end of the summer. This is due to CU’s heavy influence on the attached dwelling market in Boulder.

• The median sale price was $266,000 last month. It’s unclear why median prices tend to be highest in the first quarter, a trend which also appears for single family houses.

Boulder Attached Dwelling Median Sale Price

$150,000

$175,000

$200,000

$225,000

$250,000

$275,000

$300,000

$325,000

$350,000


2008 2009 2010 Data: BARA© Silver Fern Homes

Boulder Attached Days to Offer

0

50

100

150

200

250

300


Average 04-08

2010

2009

Data: BARA


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Client Analysis: Louisville, Colorado

• Clients recently asked us to analyze historic appreciation for targeted property in Louisville.

• We reviewed data from 1997 to 2010; nearly 700 comparable sales of 3 bedroom, 2 bath properties.

• Since 1997, the median sale price of Louisville property, similar to the target, increased 5.6% on average.

• Peak appreciation occurred in 2000 with nearly 20% increase in median sale price. The worst year was 2003, when prices fell about 2%.

• Real estate in Louisville is typically constrained by low inventory and high demand. These pressures softened in 2009.

• With prices falling, now may be a historic opportunity to purchase at or near the bottom of a real estate cycle.

2004 2005 2006 2007 2008 20090

10

20

30

40

50

60

70

80

Louisville Sales to Inventory

3 Bedroom, 2 Bath Houses

Average Monthly Inventory

Annual Sales Volume

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 YTD$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

Louisville Appreciation

3 Bedroom, 2 Bath Houses

Median Price

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Case Study: Price it Right From The Beginning

• Bill Clinton was still President when this luxury estate was first listed. It sold last month after nearly 10 years on market.

• A wishful thinking asking price usually results in a long listing period and multiple price reductions. The opportunity cost is high.

• When a house is on the market for a long time, buyers think something is wrong with the property.

• The end result is a low sale price, lower than what would have been possible if the house was priced right from the beginning.

• To maximize sale price and minimize listing period, we obsessively analyze the competitive landscape before recommending a listing price. It’s also why we provide a professional staging consultation with each listing.

Price History: 34 Boulder View Lane

3,000,000

3,500,000

4,000,000

4,500,000

5,000,000

5,500,000

6,000,000

6,500,000

7,000,000

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

Listed July 31, 2000

Finally sold March 5, 2010

A price increase - reverse logic works on my kid, right?

GW invades Iraq

Google IPO, Larry and Sergey buy Boeing 767

GW invades Afghanistan

GW re-elected - WTF?

Pluto no longer a planet

9/ 11 terrorist attacks

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Notable News (articles are linked)

• SmartRegs Moving Ahead – Boulder’s planning board unanimously approves a draft ordinance affecting energy-efficiency and rental licensing.

• ConocoPhilips Campus Plans Debated – acreage, building heights and public open space sparks debate in Louisville City Council.

• Gunbarrel Hotel Construction Begun – land preparations started by co-owned of St. Julien Hotel.

• Community Request Denied – Bear Creek Elementary to build new gym this summer despite neighborhood protest.

• Support for University Hill Tax District – one of several ideas being explored by Boulder officials to initiate redevelopment.

• CU Biotech Hub Lands Another $15MM - expected to provide facilities for hundreds of researchers, students, and faculty with a total estimated cost of $145MM (first phase).

• The Residences at 29th Street Moving Forward – 238 rental units located at 1925 30th Street; permits issued, funding secured, and slated for 2011 completion.

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Broad Market Conditions

• Tax credits have pushed forward transactions at the entry level of the market. This largely means more buyers and more listings at this segment of the market. Mid and high-end properties have been largely unaffected.

• Falling prices continue to spread into the mid-range and high-end. Sellers have to work harder preparing their homes for sale and must price carefully to attract buyers. The entry level has seen little discounting and in some cases, prices have actually risen.

• At Silver Fern, we’ve helped buyers understand the market, carefully target property, and negotiate better by substantiating the value of their offer. The result has been excellent deals for our clients.

• Mortgage rates remain near historic lows and the economy is starting to shown signs of improvement (link). Employment and housing markets are closely correlated in residential real estate.

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On the Horizon

• Keep watch on the local employment market. Layoffs appear to have reached their peak and some employers have begun hiring. Jobs are the foundation of the residential real estate market.

• New “smart” regulations are threatening to disrupt the rental market in Boulder. This will create economic opportunities as landlords adjust to the new economic reality of required environmental upgrades (or sell).

• Funding for major infrastructure projects such as FasTracks is being secured, albeit slower than expected. Related real estate developments like Boulder Junction stand to benefit.

• Even at the high end, price discounts are having an effect. Several notable luxury downtown houses have sold quickly when sellers cut asking prices, suggesting a floor has been reached at the high-end.

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How To Get A Great Deal

• Real estate transactions are one of life’s largest financial decisions. Shouldn’t you have a professional advisor?

• We believe agents should add value and earn their commission. The sooner we get started, the more value we can add.

• Give us a call. The real estate experts at Silver Fern Homes can advise you on current market conditions, help you find the right home, and negotiate the best possible deal.

sf report april 2010

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