Northern Colorado Real Estate…A Determined Market

The Northern Colorado real-estate market continues to be an "up and down" display of data. Some areas in the region are showing signs that they may have bottomed out and begin to see signs of an improved market.

Sales in Loveland and Greeley continued to slide as June sales declined 25.2% and 18% respectively. The real-estate prices in Loveland were reported down another 14.4%, Greeley 8.1% as the national market declined 7.7% as foreclosures continue at a steady pace.

During the first half of 2008 the state of Colorado experienced a 16% increase in foreclosure filings compared to the same period a year ago as reported from the Colorado Department of Local Affairs, Division of Housing.

But our Northern Colorado region outpaced the state as Larimer County saw a 25% increase to 920 filings and Weld County had a 23% increase to 1594. Broomfield and El Paso counties had the largest increases in terms of percentages.

It is important to qualify a foreclosure filing. A filing is issued when a borrower is at least three months late with payment but doesn't necessarily results in a foreclosure sale as the borrower could make arrangements with the lender or could recover and regain on time payments.

Fort Collins, seems to be positioned on the opposing side of the trend, and broke through a 10-month trend of declining double digit decreases in sales. Some believe the Fort Collins market may be poised for a rebound.

It's been said that Fort Collins didn't have the oversupply problem as other communities did and at this time there is a shortage of homes with price ranges of $250,000 and below. But even with that good news, a recent report from the Colorado Department of Local Affairs, Division of Housing, states that Fort Collins rental market vacancy rate has actually increased to 9.5% which could be related to some of the highest rent rates on the Front-Range.

With good news in some areas of the region there remain problems with the market as residential builders and contractors are almost idle as construction costs have increased and some have moved and set-up shops in other parts of the country while others continue to remain in the area doing other work.

But, there are other forces that are working to reduce the glut of homes. Outside money is reaching the Northern Colorado Region, and especially in Weld County where announcements have been made of millions of dollars to purchase properties. Banks are willing to discount prices, or short sell in some cases, to prevent an increase or reduce their inventories.

This slump, sub-prime debacle and the tightening of credit has resulted in a fantastic rental market in some of the communities as published through the quarterly newsletter of Rentmarkets.com. The Loveland rental market is enjoying a vacancy rate of 5.7% and is the lowest rate on the Front-Range. The Greeley rental market vacancy rate has dropped to 6.1%. This improvement could be attributed to the high rents in the neighboring cities of Loveland and Fort Collins, which are averaging $835.00

Also, a recent report of the Denver area rent market stated a 3% increase in the 2nd quarter vacancy rate to 6.2%. This was a surprise to many as it was believed that displaced homeowners were filling the vacancies and affordable rates were getting hard to find as the vacancy rates were declining.

On the national scene, foreclosures continue to rise as 220,000 homes were lost to bank repossessions in the second quarter as reported by RealtyTrac. That's up 14% from the first quarter and 121% from the same period in 2007.

It's important to note that much of the default from foreclosures is being driven by just a few states, such as Nevada, California, Florida, Ohio, Arizona and Michigan. But also, note that 48 out of 50 states have experienced year-over-year increases in foreclosure activity.

With all of the data given it remains difficult to determine where our regional market is and where it's going in the near term. It's a very mixed bag of data that's very community dependent at this time.


Kathleen Steadman has written for various online publications covering such areas as apt rentals, homes for sale and other real estate related topics. She writes this article on behalf of RentMarkets.com, an online resource for rentals that helps both landlords and renters expedite the rental process in Northern Colorado.