How hot can it get? The region’s housing market continued to set records for median sales price in many cities in May, with low inventories and high demand pushing prices up.
That’s according to the latest sales data from Loveland-based Information & Real Estate Services LLC, the multiple-listing service for the region.
“We are an extremely red-hot market, and whether you look at it good or bad, we are going to continue to see this type of increase because the lack of inventory is forcing those prices up. We still have an incredible amount of buyers who are trying to land,” said Dennis Schick, broker owner of Re/Max Alliance, which has offices throughout the Boulder Valley and Northern Colorado.
Schick said his company has conducted statistical analysis of sales in the region, revealing that the dollars over asking price was “enormous” on some home sales, with 57% of homes in the Fort Collins area selling for more than asking price.
“And they’re already being started at relatively high list prices,” he said, adding that other communities such as Greeley saw similar sales-over-list-prices, though not quite as high.
“The inventory shortage appears to continue,” Shick said
Exacerbating the problem are soaring prices for construction materials and products, from lumber to faucets, plastic goods and asphalt shingles. That adds to the difficulties for buyers, who find few existing homes on the market.
“Normally, with new homes, you had a safe haven if you were a buyer,” Schick said. “You knew exactly what you were getting into. Now, a lot of these new homes have clauses that [prices] can actually be increased, that you’re going to have to re-review that price in order to know the final sales price.”
Appraisals have not kept up with the market, Schick said, with many properties appraising for less than the agreed-upon sale price. That puts the squeeze on first-time home buyers who might not be able to make up the difference with cash, he said.
Greeley-Evans set a record, with a median sales price of $370,000, up from $365,000 in April and 16.9% from $316,390 in May 2020.
Active listings in Greeley-Evans totaled 200, down 42% from 345 a year ago.
Schick said that Greeley, which has abundant water and land, and which has embraced metro districts, stands poised to become a focal point for housing growth.
“They have the two biggest commodities with the land and the water, but they also have the willingness to grow,” Schick said. “There’s a lot of communities that don’t necessarily want to grow because they can’t. Greeley is in a unique situation. They could choose not to grow, but they actually are embracing growth. I think it will be a controlled growth. It’s not going to be haphazard.”
That availability of housing, as well as job opportunities from Greeley employers, will cause many people to migrate to the city, Schick added.
Other cities in the region also set median-sales-price records.