Five of the 11 major housing markets in northern Colorado have experienced increases in value despite the overall economic downturn, according to a new, in-depth study on home prices released by the Colorado State University Everitt Real Estate Center.
The indices rely on data from IRES LLC, the area’s Multiple Listing Service, and include more than 180,000 closings from 1997 through 2008 in Boulder, Larimer and Weld counties.
The study is more detailed than other indices that report home prices for broader metropolitan areas and uses Geographic Information Systems (GIS) to select data by Census Tract in order to evaluate smaller boundaries – almost on a neighborhood-by-neighborhood basis.
Two researchers for the Everitt Real Estate Center, John Gerhard and Sriram Villupuram, conducted the study, which is scheduled to be released twice a year – in March and August.
"Northern Colorado’s housing market is actually in fairly good shape according to our analysis of housing prices," said Gerhard, "Our real estate market in northern Colorado is ‘hyperlocal,’ meaning it can vary widely by neighborhood and even block by block. That’s particularly important for homebuyers, given the conservative lending practices resulting from the world financial crisis. Home values may be stable or increasing despite the seemingly widespread perception that the entire market is struggling."
The five northern Colorado markets that experienced increases in value were, from highest to lowest, the Dacono-Frederick-Firestone area, Fort Collins-Timnath, Boulder-Gunbarrel, Estes Park and Erie.
More study highlights:
-At year-end 2008, the Boulder-Gunbarrel market area had the greatest overall appreciation since the base year of 1997, up 89.1 percent.
-Lafayette-Louisville-Superior registered the second highest appreciation followed by Estes Park, Erie and Fort Collins. The Greeley-Evans market areas had the lowest overall appreciation during this time period with 7.9 percent.
-In 2008, home prices increased in six of the 11 major market areas in Northern Colorado. The greatest percentage increase occurred in the Tri-Cities market area (Dacono, Firestone and Frederick), up 2.1 percent, followed by a 1.5 percent increase in Fort Collins-Timnath.
-In contrast, the greatest decline in home prices occurred in Greeley-Evans, down 8.2 percent in 2008.
The study uses a weighted repeat sales methodology similar to the Case-Shiller Index, which measures price change for the same home over time, rather than the conventional median sales price methodology which may be impacted by the type of homes selling in a given period. The EREC Indices differ significantly from other repeat sales indices, and include all transactions as well as attached housing. In addition, the Everitt center’s House Price Indices illustrate the performance of different price ranges of homes within each of the major market areas. Each market area is split into three equal tiers based on closing price to analyze the appreciation or depreciation of low-, medium- and high-priced homes for each market area.