The article below represents what we have been seeing in the housing market for the past year. While there are still plenty of building lots and land available, the excellent deals that could be had just several months ago are becoming more difficult to find as demand increases.
Real estate experts report encouraging signs in Loveland, Fort Collins
By Craig Young, Reporter-Herald
Article from Loveland Reporter Herald, 10/24/2012
FORT COLLINS – Two experts dished up optimism during a real estate conference Wednesday, and they provided statistics to back up their assertions. Speaking at the Colorado State University Everitt Real Estate Center’s annual conference, the two said both the residential and commercial real estate markets are showing growth in the wake of the industry’s collapse four years ago.
John Covert, Colorado director of housing market data provider Metrostudy, pointed to indicators such as Northern Colorado’s job growth, housing starts, closings and housing inventory. “Things are definitely improving,” he said. Larimer and Weld counties have added 4,800 jobs this year, he said, approaching the region’s 225,000-job level of four years ago. The homebuilding industry now is a contributor to the economy, rather than a drag on it, he said.
Housing Starts, Closings
Housing starts in Northern Colorado had increased 52 percent through the third quarter of this year to 2,047, compared with 1,346 during the same period in 2011. Covert said it’s reasonable to expect housing starts to continue to grow by 35-40 percent in 2013. Meanwhile, the 1,917 closings on the sale of homes in Larimer and Weld counties through the third quarter represent a 39 percent increase over 2011, he said.
Housing starts outpacing closings is a sign that the market is growing and that some builders are beginning to construct a few houses on speculation. “Four years ago,” Covert said, “there was very little reason to start new homes.” Within Larimer County, Loveland and Fort Collins “are neck-and-neck,” with about 475 housing starts each so far this year, he said.
Despite the difference between starts and closings, “there is not a lot of housing inventory sitting out there, and a lot of demand,” Covert said. Northern Colorado has 150 completed, vacant new homes – about a one-month supply. A balanced market should have a two-month supply, he said. He expects the housing inventory to remain tight for the foreseeable future. “There’s a ton of pent-up demand still sitting on the sidelines, wanting to buy a home.” In terms of vacant, developed housing lots, Northern Colorado has almost 9,000, compared with the Denver area, which has fewer than 12,000. In a balanced market, builders would start 15,000 to 17,000 homes a year in Denver, he said, meaning the national homebuilding companies there are “scrounging for lots” and looking northward.
On the commercial side, Matt Bannister of the CoStar Group said statistics on office, industrial and retail properties, while not booming yet, “are what you’d expect to see in a recovery trend.” His company, a commercial real estate data provider, considers the Denver market everything from south of the metro area north to Fort Collins – 80 percent of the commercial real estate in Colorado. Office vacancy rates are coming down in that large region, he said, and he’s seeing a corresponding increase in rents in the metro area. But rents haven’t risen accordingly in Northern Colorado yet, Bannister said.
The industrial market isn’t great, he said, but it’s moving in the right direction. The severe downsizing of large companies such as Kodak and Agilent in Northern Colorado have contributed to a higher industrial vacancy rate than in Denver-Boulder, he said.
The news also is mixed in the retail market in Northern Colorado. Rents are at a four-year low, he said, down 31 percent from the fourth quarter of 2008. But sales of retail properties are showing promising signs, Bannister said, with “dramatic increases” in the number of transactions and dollar amount this year over last, and a growing influx of money from out-of-state buyers. –end of story from Reporter Herald.
If you would like to discuss your options for building a new home in Northern Colorado please contact us for more infomation. We build in Loveland, Fort Collins, Berthoud, Windsor, Timnath and surrounding areas.