Note to Reporters: Reporters may obtain a copy of the report by contacting Jennifer Dimas at (970) 491-1543 or Jennifer.Dimas@colostate.edu.
The results of the Colorado Residential 2011 survey were released yesterday at “Housing Colorado’s Future in Fort Collins” hosted by the Colorado State University College of Business’ Everitt Real Estate Center.
Stephen Laposa, director of the Everitt Real Estate Center, in conjunction with the Colorado Association of REALTORS, Colorado Mortgage Lenders Association, and the Colorado Association of Home Builders released results based on statewide surveys. The surveys provide a comprehensive view of the residential market in the state of Colorado. Survey results include the following highlights.
The CMLA expect interest rates to increase in 2011. Although evidence suggests that industry has assimilated recent regulations, major concerns remain regarding the increased regulations and the possibility of unintended consequences. Such consequences may result in consumers being negatively impacted by loan officer compensation regulation. It was discovered that loan originations and refinancing demand lacks consistency and recovery “feel.”
CAHB believes construction financing will continue to be difficult to obtain, even for highly qualified borrowers. Distressed sales and borrower qualifications are major barriers for home builders. The majority of builders in the sample size are participating in the Energy Star program.
CAR forecasts more transactions, short sales and regulations in 2011. They do not believe there will be a significant change in the days-on-market over 2010. Buyer confidence and qualifications remain top barriers to sales. Distressed sales, appraisals, and seller perceptions are impacting residential valuations.
Other key findings include:
• Interest rates and regulatory environment are top concerns.
• CAR respondents are generally more optimistic in terms of economic issues than CAHB or CMLA respondents.
• Plans to scale back Fannie Mae and Freddie Mac are believed to be troubling for consumers and industry.
Final results are based on the number of survey respondents as of March 18, 2011. The total number of survey respondents is: (A) 272 for CAR, (B) 164 for CAHB, and (C) 138 for CMLA.
John Gerhard of CSU’s Everitt Real Estate Center released 2010 year-end market updates. Total home closings in Northern Colorado has fallen 32 percent since it peaked in 2004. Attached (condo, townhome and duplex) home closings are down 9 percent since 2009, while detached home closings remain stable with an increase of less than 1 percent. Weld County represents the greatest decline in total closings with a 6 percent decrease in 2010.
Additionally, the total number of available homes in Northern Colorado has decreased 2 percent since year-end 2009. Based on the average monthly sales absorption, the total supply of homes remained unchanged over a six-month supply. Attached (condo, townhome and duplex) listings fell 4 percent in Northern Colorado for year-end 2010 while detached listings fell about 1 percent. Despite these decreases, Larimer County registered the only decline in total monthly supply of available homes with a 3 percent decrease for year-end 2010.
“We are pleased to work with the Everitt Real Estate Center at Colorado State University on this inaugural survey of our statewide Colorado Association of Home Builders members, and find the results informative and useful,” said Michael Doddridge, president of Home Builders Association of Northern Colorado.
“When speaking to my counterparts around the country, I have found that most of us are concerned about the same things – interest rates, lender regulations and buyer activity,” said CMLA board chairman Pete Lansing. “We are all concerned about the real estate economic recovery. The results of the Everitt/Colorado State University survey pinpoint these concerns.”
“We appreciate the Colorado State University Everitt Real Estate Center’s efforts to bring to light how professionals in the real estate industry feel about the various real estate related topics covered in this informative survey,” said Robert Golden, CEO of the Colorado Association of REALTORS.
Elizabeth Garner, state demographer for Colorado, presented a summary of the past demographics and future forecast. The summary findings for Colorado’s population forecast include:
• Colorado’s population is forecast to grow to 7.1 million by 2030 with most of the growth occurring in the Front Range and Western Slope.
• Households by age are forecast to grow differently over the next two decades.
• The largest growth will be in the households over 65 compared to the previous decades where the growth was in the 25-44 and 45-64 year old age groups. The under-65 age households will grow at an annual average rate around 1 percent compared to 7 percent for the 65+ households.
• The aging of baby boomers will have a significant impact in many areas in Colorado over the next 20 years. Between 2010 and 2030, the population aged 65 and over is expected to increase from 540,000 to 1.35 million. The growth of this population will impact many areas including the labor force, household incomes, housing demand, public policy, and public finance.
• Colorado is become more racially and ethnically diverse. This diversity is especially significant at the younger ages – 42 percent of the population under 18 is a minority compared to 16 percent over the age 65.
• Median household income declined between 2000 and 2009. Factors influencing household income (age, household size, occupation, education and race/ethnicity) all indicate that median household income could continue to fall or grow very slowly.
More about the Everitt Real Estate Center
The Everitt Real Estate Center, located at Colorado State University’s School of Business, seeks to integrate real estate students with the Northern Colorado and Front Range real estate community and disseminate applied research that responds to critical current and future real estate issues, whether regionally or globally. Through conferences and research, the Everitt Center has addressed smart growth, green buildings, real estate and the alternate energy industry in addition to neighborhood home prices for Boulder, Larimer, and Weld counties.
Research in progress includes corporate real estate and corporate sustainability strategies, urban real estate and urban climatology, comparative analysis of Northern Colorado and a peer group of 40+ similar size cities, and real estate public policy tax issues.