Inside Real Estate News » Gary Bauer

Buyers pay $64 million for luxury homes

John Rebchook — Tue, 15 May 2012 18:22:12 +0000

Buyers paid $64.2 million for 41 luxury single-family homes and condominiums in April in the Boulder-Denver area, according to a report released today.

“Sixty-four million is nothing to sneeze at,” said independent broker Gary Bauer, who released the report that also showed almost a 50 percent drop in the unsold inventory from a year earlier.

The report also showed that while sales of single-family homes priced at $1 million or more are down in April almost 30 percent from April 2011, year-to-date sales volume is higher than in 2011.

An earlier report by Kentwood Real Estate showed a similar trend, although it did not include Boulder County, but focused on the counties in the Denver area. Both reports use Metrolist data.

In April, 20 of the luxury sales were evenly divided between Boulder and Denver counties, according to Bauer. There were eight luxury home sales in Douglas County, six in Arapahoe County and two in Jefferson County. All five condo sales were in Denver.

“The luxury market is almost a mirror of the overall market,” Bauer said. “We are seeing a declining inventory for the luxury market, just like for the overall market.”

One reason that the April sales figures showed a big percentage drop, is because well-heeled buyers have been able to land excellent deals, knocking many homes out of the seven-figure category.

“Many homes that previously were listed at $1 million to $1.15 million or even $1.2 million, are now selling below $1 million,” Bauer said.

There are now only 596 single-family homes on the market, a 48.5 percent drop from the 1,157 active listings in April 2011.

One reason there is such a huge drop in unsold inventory is because owners of high-end homes are seeking options other than outright sales, Bauer said.

“Many owners who haven’t been able to get the price they want are leasing their homes for one-year or two-year options, often with the right to buy the home at the end of the lease,” Bauer said. “Each deal is a separate and unique transaction.”

Often, the listing broker is helping the owner structure the lease arrangement, he said.

In April, the average sales price of a home was $1.6 million, compared with $1.5 million a year earlier and the median sales price was $1.4 million, compared with $1.3 million in April 2011.In April 2011, 51 luxury single-family homes sold for a total dollar volume of $76.million.

In April, five condos sold for a total of $6.2 million, compared with six condos selling in April 2011 for $7.7 million.

In the first four months of the year, there have been 161 total sales for $243.1 million, compared with 156 sales for $235.9 million during the same period in 2011. There have been 148 single-family home sales so far this year for $224.4 million, compared with 143 for $218 million through April of last year. Condo sales are unchanged, with 13 sales, although the condo dollar volume this year was $18.7 million, compared with $17.9 million in the first four months of 2011.

Have a real-estate story idea or a news tip? Contact John Rebchook at JRCHOOK@gmail.com.

Luxury home market jumps

John Rebchook — Mon, 16 Apr 2012 19:32:53 +0000

Buyers paid $178.9 million for homes and condos that cost at least $1 million each in the 11-county Denver area during the first quarter, 18 percent more than the $151.6 million during the first three months of 2011, according to a report released today by Gary Bauer.

A similar report was released last week by the Kentwood Real Estate, which tracked sales in the five main counties in the metro area – Adams, Arapahoe, Broomfield, Denver, Douglas and Jefferson. Bauer, an independent Realtor, also included Boulder, Clear Creek, Elbert, Gilpin and Park counties in his report. Both reports were based on Metrolist data.

Bauer’s report showed that the number of homes sold in the first quarter rose by 21.2 percent to 120 from 99 during the same period last year.

March was the strongest month so far this year.

There were a total of 49 single-family, detached homes selling, compared with 30 in March 2011, a 48.4 percent jump. Closed dollar volume rose 47 percent to $74.9 million from $50.9 million. A lone condo sold for $1.31 million last month. However, that sale represented two units purchased by Bell Tower Homes LLC at 2267 Ogden St. Together, the units have 15,632 square feet of space, eight bedrooms and 12 bathrooms.

“It was better than I expected,” said Bauer, an independent Realtor, said about last month’s luxury home sales. “This is just an extension of the overall market. If we can continue this momentum, both for the overall market and the luxury market, we are going to have a great year.”

Bauer said he didn’t think that well-heeled buyers are necessarily feeling that they are getting great bargains, although there are a number of those available, especially in the highest price ranges. The most activity is in the $1.5 million range, he said.

This is one of the two luxury condos that sold last month for a total of $1.3 million.

“I wouldn’t go as far to say the luxury market is being driven by bargains,” Bauer said. “I think it is more of a case along the lines is that we have very educated buyers and very educated sellers coming together. Both sides know the market very well. Lines are not being drawn in the sand early in the game.”

He said increasingly the biggest concerns of many Realtors, for the overall and the top of the market, when buyers get financing on their purchases (buyers at the very top of the market often pay cash, and put a mortgage on their home later), is that appraisals are not keeping up with an appreciating market.

“Prices are only rising modestly now, but with the low inventory of available homes on the market, prices may very well rise more this summer,” Bauer said. “I think brokers really need to educate appraisers on why transactions can occur at the agreed upon price between the willing buyers and willing sellers.”

Contact John Rebchook at JRCHOOK@gmail.com

Luxury home inventory plunged 35%

John Rebchook — Tue, 17 Jan 2012 17:32:00 +0000

This Cherry Hills home sold for $8.2 million last year, the highest price paid in the metro area.

The Denver-area luxury market in 2011 was little changed in terms of sales and dollar volume from 2010, but like the overall market, the active inventory of homes priced at least $1 million plunged, according to a report released today.

At the end of last year, there were 566 single-family unsold homes in that price range for sale, a 35 percent drop from the 875 at the end of 2010, shows a report released by independent broker Gary Bauer.

The number of unsold condominiums on the market fell by 28 percent to 53 from 87.

“The big thing is that for the $1 million-plus market, like every other market, inventory has been reduced dramatically,” said Bauer, who uses Metrolist Inc. data to track sales in an 11-county area.

Some brokers who specialize in high-end homes think that will help boost prices, because typically a smaller supply, combined with demand that is relatively to the same, usually results in higher prices.

“I’m not so sure about rising prices,” Bauer said. “I think the discounts already have been priced into homes Homes on the market are selling for less than they would have in prior years. Sellers are much more realistic in terms of the asking price, and prices have been reduced.”

Dan Polimino, who this week launched a luxury home division at Keller Williams Realty DTC with business partner Gary Lohrman, said nothing in the numbers surprise him.

“In essence, clearly from 2010 to 2011, people bought the existing inventory and nothing new came on the market,” Polimino said. “What this will mean is A, prices will stabilize, and B, dare I say, they will increase. But there are a couple of components to that equation. No. 1, the inventory has to continue to come down and No. 2, demand needs to come up. I’m not so sure that the demand is going to rise.”

Polimino said there are several things making the well-heeled skittish.

First, he said, is the general economy, which faces even more uncertainty because this is a Presidential election year. “Some people are holding back from pulling the trigger, because they want to know who is going to be elected President, first.”

Also, borrowing money at today’s historic low interest rates is a hassle even for the well-heeled, he said.

“There are people out there who have the cash to pay for a home, but they say why would I do that, if I can borrow somebody else’s money at 5 percent? Even though there is more money available for these kind of loans than a couple of years ago, they find with all of the guidelines and documentation involved, it is just ridiculous. It is another barrier and becomes an impairment, so they say, the hell with it. I’ll just wait.”

On the other hand, those qualified to buy a seven-figure home are finding spectacular deals. He said there are homes out there in which the current owner has invested north of $6 million and now it can be purchased in the neighborhood of $3.3 million.

“Anytime you can get a home for 50 percent off, it might be the time to pull the trigger, even it is an election year.”

Buyers paid $763 million for 502 single family homes last year, compared with $773 million for 505 single-family homes in 2010. The average price of a single-family home that sold was unchanged at $1.5 million.

“The sweet spot remains in the $1 million to $1.5 million price range,” Bauer said. “There are still more expensive homes selling, but they are far and few between.”

The most expensive single-family home last year sold for $8.2 million for a 5-bedroom, 12,298-square-foot home in Cherry Hills Village.

Meanwhile, 38 luxury condominiums sold last year, 10 percent more than the 32 in 2010. Sales volume for condos rose 15 percent to $56 million from $49 million, although the average sales price fell by 3 percent to $1.4 million from $1.5 million. The highest price paid for a condo was $2.85 million for a 3,120-square-foot unit.

Bauer’s report includes the counties of Adams, Arapahoe, Boulder, Broomfield, Clear Creek, Denver, Douglas, Gilpin, Jefferson and Park.

In December, there were 39 luxury single-family homes sold, compared with 42 in December 2010. The average sold price in December was $1.5 million, and the median sales price was just under $1.3 million. Of those homes, 10 were in Douglas County, nine were in Boulder and Denver counties, five were in Arapahoe, four were in Jefferson and one in Broomfield and Gilpin counties.

Four luxury condos, all of them in Denver, sold last month, compared with one in December 2010. The average condo sale price was $1.62 million, and the median sales price was $1.575 million.

Contact John Rebchook at JRCHOOK@gmail.com

Record inventory drop

John Rebchook — Tue, 10 Jan 2012 21:42:42 +0000

This 3,112-square-foot home in Lakewood is on the market for $279,900. Realtors say the Denver-area market could use more homes like this, because of the unprecedented drop in inventory.

The inventory of unsold homes on the Denver-area housing market in 2011 experienced the largest percentage drop on record from the highest point to the lowest point in a year, shows an analysis of more than 20 years of data by InsideRealEstateNews.com.

While it has been well-publicized that the inventory levels had been dropping in the Denver area last year, even experts were awed by the huge intra-year drop in 2011.

From the peak of the market in June of last year, when there were 19,573 unsold homes on the market to December when there were only 12,531, the market plunged by 36 percent. The year-over-year inventory drop at the end of 2011 also was a record at 34 percent.

By contrast, in 2010 and 2009, inventory levels fell about 21 percent from the peak to trough in each year. And in 2003, the inventory fell only 12.6 percent, the lowest intra-level drop since at least 1990.

“That is huge,” economist Patty Silverstein, said about last year’s 36 percent inventory drop. “It is really interesting to look at it that way. It really puts it into perspective.”

Surprised? Months supply lower now than in 2006

The low inventory combined with slightly increased sales, has led to less than a four-month supply of homes on the market, which under normal conditions with be considered a solid, seller’s market. By contrast, in the summer of 2006, when it was clearly a seller’s market, there was about a six-month supply of unsold homes on the market.

Yet, while there is anecdotal evidence that prices are rising at lower-price points, clearly prices have not taken off the way they would normally do when the supply is so out-of-balance with the demand.

“There are a lot of metrics we like to monitor, but they don’t tell the usual story in this unique market,” said Peter Niederman, CEO of Kentwood Real Estate.

“You still have to be cautious. There are still challenges to the economy and challenges to consumer confidence and challenges to the job market. People have to feel good about their jobs before they buy a home. But I do think that our market is better than most places in the country, and will recover faster than most places.”

Silverstein, the chief economist for the Denver Metro Economic Development Corp. and the Metro Denver Chamber of Commerce, said the drop in inventory raises the question whether consumers are simply not selling their homes because they are unhappy with the offers they are likely to receive in today’s soft housing market, or has there been a sea change in the decline of inventory because so few new homes have been built in recent years?

“My guess it is a little bit of both,” said Silverstein, who also is principal of Development Research Partners in Littleton. “Some folks will begin putting their houses out there again when they can see a bit more appreciation. And we’re starting to reach the point given the organic household formation and in-migration that it might be time that homebuilders start to build some more homes.”

Independent broker Gary Bauer said that he is “100 percent certain” that last year’s inventory drop was the biggest percentage drop ever experienced in the Denver area.

11-year low

Indeed, the last time that there were fewer homes on the market in December was in 2003, when there were 8,820, a time when the Denver-area population was about 20 percent lower than it is today.

“Essentially, this is a good news, bad news story,” Bauer said. The low inventory keeps the pressure on prices, while it also means that consumers have less to choose from and may become discouraged.

A year ago, many in the market were worried that a “shadow market” of bank-owned foreclosures were going to swamp the market in Denver and markets across the country, driving down prices.

That didn’t happen.

“I just read a White Paper that the federal government is looking at putting more short sales, pre-foreclosures and REO (real estate owned, or bank foreclosures) in a rental pool,” Bauer said, which would further reduce the chance of shadow inventory causing a glut of homes hitting the market.

Stephanie Prather, a broker with 8z Real Estate, last week heard of a bank-owned home near Belmar in Lakewood receiving six offers. She had a buyer potentially buying it at around the $165,000 asking price, but the listing broker told Prather that she already had received several offers above that price.

“That home is in absolutely awful condition,” Prather said, although it is in a neighborhood of $240,000 to $250,000.

Prather sells a lot of homes in the $150,000 to $300,000 range, the “sweet spot,” for home sales in the Denver area.

Prospective buyers, especially in that price range, need to change their strategy, she said.

“It’s becoming more of a seller’s market,” in that price range, she said. “Buyers think they can still beat-up sellers when they write offers, but sellers are not cooperating the way they were. The market has not just gone crazy out there, but people, especially below $300,000, are getting multiple offers, and some of them are at the asking price or a little bit above.”

Why wait ’till spring?

The low inventory, however, does create opportunities for seller of homes that are appropriately priced.

Prather convinced one client to put her home on the market at the end of this week, rather than wait for the traditional spring selling season.

“We talked about it, and I suggested we list it now, instead of waiting to the spring when there will be more competition,” Prather said.

Chris Mygatt, president of Coldwell Banker Residential Brokerage, said today’s inventory levels “truly are incredible. They are unprecedented.”

Mygatt said the low inventory is keeping pressure on prices, “but I don’t think it artificial. The low inventory is a real driver of prices.”

However, he is concerned that some prospective buyers, especially first-time buyers, will become discouraged when they can’t find their dream home, and will continue to rent. On the other hand, rising rental rates increasingly will make buying appear attractive, especially with interest rates hovering at or near historic lows, he said.

Sense of urgency

At this point, he thinks the market can absorb quite a few more homes on the market, before it will drive down prices.

“What it is going to do is create a sense of urgency,” something the Denver market has not experienced during the past five years or so. “That’s because as some of the finer properties that are priced right begin to hit the market, they will be gobbled up quickly.”

Jack O’Connor, principal of the Denver 100 LLC, said that more people aren’t putting their homes on the market because they do not have any equity in them and either can’t, or are unwilling, to bring a check to the closing table.

“I agree with Jack on that,” said Niederman, of Kentwood. “I think a lot of people are just not comfortable yet with being able to sell.”

Still, the extent of last year’s inventory drop is “amazing,” Niederman said.

“I think a lot of parts of the country are still seeing increased inventory, while we are facing one of the largest, if not the largest, declines we have ever seen,” Niederman said.

“I think we just need to be patient right now. Markets are never 100 percent in balance; they always have a certain ebb and flow. The thing is, we do not have enough inventory right now. It might be a good time to put your home on the market. If you are a move-up buyer, you might make a little less than you had hoped for selling your home, but you will more than make it up with the deal you get on the buy side.”

Year	Month with highest inventory	High-point for inventory	December inventory	Percentage drop from high point to low point
1990	June	16,711	11,839	29.1
1991	June	13,669	10,147	25.7
1992	August	12,771	9,631	24.6
1993	August	10,415	7,711	25.9
1994	September	10,630	8,569	19.4
1995	August	11,531	9,854	14.5
1996	August	13,793	11,000	20.2
1997	Augut	14,296	11,093	22.4
1998	July	13,654	10,352	24.2
1999	September	10,310	8,097	21.4
2000	September	10,998	8,820	19.8
2001	October	19,319	16,482	14.7
2002	October	23,769	20,676	12.6
2003	July	26,764	21,623	19.2
2004	June	28,043	20,891	25.5
2005	September	27,200	23,572	13.3
2006	July	31,389	24,534	23.3
2007	August	30,827	24,603	20.2
2008	May	26,333	19,600	25.6
2009	July	20,890	16,456	21.2
2010	July	23,933	18,867	21.2
2011	June	19,580	12,531	36.0

Contact John Rebchook at JRCHOOK@gmail.com

Fox shout-out to Denver

John Rebchook — Fri, 06 Jan 2012 22:52:37 +0000

Greg Rand

Be sure to watch the report. A link to it, titled “Watch this report” can be found at the bottom of this article.

The Denver housing market recently got a national shout-out from housing and real estate investing expert Greg Rand on Fox Business.

While millions watch Fox Business, many may have missed the program in which Rand, owner of OwnAmeica.com lavished praise on Denver’s housing market and economy, because it originally aired on the holiday weekend between Christmas and New Years. But the video is starting to make the rounds in Denver real estate circles.

“Probably two dozen people today asked me if I had seen the Fox news clip,” said Peter Niederman, CEO of Kentwood Real Estate. “I’m not kidding. Wherever I went today, whether it was at lunch or in a business meeting, everyone asked me about it – and not just people in Kentwood. It is amazing! It is exciting. It was fun to hear that there might be more in-migration to the area. He talked about all of the things you and I have talked about in the last 12 months, but it was exciting to hear an outside pinpoint what a great place Denver is to live.”

Rand, a real estate investment consultant, author and radio and TV personality, pitched the attributes of Denver for much of the 4 minute and 4 second program in a way that would have made any chamber of commerce-style cheerleader proud.

“It looked a little bit like we had written an advertorial,” quipped Tom Clark, executive vice president of the Metro Denver Economic Development Corp. ”It is just one of those times that somebody looking for a good place to invest in real estate and housing and hands us a gift.”

Clark said his group will definitely be showcasing the TV report. “If we have anything to do with it, it’s going to be a help,” as far as drawing more people to the Denver area, he said.

“There doesn’t seem to be much wrong with Denver,” the Fox financial reporter interviewing Rand said at one point.

“That’s a good way to put it,” he said.

Report heavy on facts, charts

But the report wasn’t fluff. It was full of statistics and charts being quickly flashed on the screen. For example, Fox showed a chart tracing the history of home prices in Denver during the past 15 years, which Rand noted does not illustrate a housing collapse, but simply a housing correction.

Clark, however, said that Denver’s relatively steady home prices have been a “little bit of a disadvantage,” when pitching the metro area to other companies considering moving or expanding here from other parts of the country. “We’re starting to get a lot of activity and interest from people in the Midwest, where people have taken huge hits on their homes that we did not experience here,” Clark said. “They experience a little bit of sticker shock, when they find out that our prices did not crater like their prices did. We counter that by telling them if you bring employees here, they won’t need to fear that their houses are going to lose a lot of value, because of our stable real estate market.”

The flip-side is that low housing prices aren’t the selling point that they might seem at first blush. “I was talking to one CEO who told me, “Sure, I can buy a $500,000 home in Phoenix for $190,000, but I would have to wait four years before I have any neighbors.”

Rand noted that the average age in Denver is 31 years old and the unemployment rate is below the nation’s. He said while people are living the southeast, northeast and California, people in Denver can’t imagine living anywhere else. He said when he talks to people in the Denver area, they tell him that they don’t just “like‘ living here, “but love living in Denver…Amazingly, it all comes down to lifestyle.”

In a telephone interview with InsideRealEstateNews this afternoon, Rand said that he does the Fox show once a month, as part of the network’s attempt to drill down to what is important to people on Main Street.

“Fox is trying to compete with CNBC on business news and CNBC does all of these reports on stocks and bonds and mutual funds and currency,” Rand said. “Fox does that, too, but on my show they really want to step back to show where people are moving and living and where home prices are likely to appreciate, and how they can invest in real estate. When you look at all of the demographics, Denver comes up beautifully.”

He said he looks at housing markets the way a Home Depot or Lowes looks at an area before it decides to build a new store.

But that only tells part of the story.

“When you look at all of the data points, it always comes down to the softer, lifestyle-oriented issues,” Rand said. “In Denver, people love the fresh air.”

Denver a draw to young professionals

Tami Door notes that Denver area s becoming even more inviting because of its increasingly vibrant and inviting downtown.

Tami Door, president and CEO of the Downtown Denver Partnership did not see the program when it aired, but clearly Rand is preaching to the choir, in her case.

“What he is saying is reflecting what the Downtown Denver Partnership started pursuing in a big way four or five years ago,” Door said. “All of our research was showing – and all of the research that we are collecting is showing – is that professionals in the 24 to 35 year-old range will be making a significant career movement if they can be within three miles of an authentic center-style city. We overlayed that on top of focusing all of our efforts to attract that demographic, while doing everything to make our downtown even more vibrant, exciting and full of amenities. What research shows is that they don’t have to be living in the heart of downtown, but what they need to do is have that healthy, vibrant downtown available to them.”

Indeed, that is more important than drawing corporations to relocate downtown.

“If these young, educated workers come to Denver first, the companies will follow,” Door said.

Independent real estate broker Gary Bauer said that Rand’s comments mirror what many in the Denver real estate community have been saying for years.

“We are a true market unto ourselves,” Bauer said.

Rand, for his part, said he has not spent near as much time in Denver as he would like, although he plans to be here next week on a business consulting trip.

“Really, all of Colorado has a lot going for it, with Denver in the heart of it.”

Video: Watch this report

To learn more about OwnAmerica, please visit this link.

Contact John Rebchook at JRCHOOK@gmail.com

Home market improves in 2011

John Rebchook — Tue, 03 Jan 2012 22:20:16 +0000

This Denver home, priced at $275,000, is very close to the average price of a home that sold in Denver.

Denver-area home buyers snapped up slightly more than $10 billion of homes last year, at a time when the inventory of unsold houses fell to an 11-year low, according to a comprehensive housing report released today.

“Was 2011 a dynamic year that is going to go into the record books? No. But it was better than 2010 and this year probably will be better than 2011,” said independent broker Gary Bauer, who released the monthly and year-end report based on Metrolist data.

Bauer’s analysis shows that 39,387 homes and condos sold and closed last year 1.5 percent more than the 38,817 in 2010.

The total sales volume was just under $10.1 billion, while in 2010, it had dipped just below $10 billion, the first time that had happened in non-inflation adjusted dollars in a decade.

“Overall, I think the market was a really good market last year,” Bauer said. “Average prices were up a bit in December, showing a little bit of appreciation, and the number of transactions were similar to those last year.”

Meanwhile, there were only 12,531 unsold homes on the market in December, a 33.6 percent drop from the 18,867 on the market a year earlier. Inventory numbers also were down 12.2 percent from the 14,275 in November.

Peter Niederman, president and CEO of Kentwood Real Estate, said the low inventory is “mind boggling. Absolutely mind boggling.”

A year ago, he noted, experts were worried that the market would be flooded with “shadow inventory,” the homes that banks had acquired through foreclosures, but had not yet put on the market. “It is almost like, if you have shadow inventory, put it out there for us to sell,” Niederman said.

Sellers in a waiting mode

“The individual consumer is sitting on the fence at this time,” Bauer said. “If they don’t have to sell, they are holding off and waiting for a time on the horizon that is better than today.”

At the same time, he is sensing a growing pent-up demand.

“With interest rates at historic lows and with sellers serious about selling their homes, people are having this feeling that it is not going to get better than this,” Bauer said. “On an individual basis, they are going to achieve another item on their dream list, buying their home.”

The average price on a year-to-date basis for a single-family home sold in 2011 was $279,858, compared with $282,080 in 2010. The average closing price in December was $275,610 compared with $275,951 in November and $274,625 in December 2010.

The median price of a home, on a year-to-date basis and in December, was $230,000, compared with $235,000 at the end of 2010 and $225,000 in December 2010.

The average price of a condo closed at the end of 2010 was $159,141, compared with $161,005 in 2010, while in December it was $166,420, compared with $166,841 a year earlier, and $153,526 in November.

Niederman had predicted that closings would be up 3 percent to 5 percent from last year. “I came up a little short,” Niederman said. “Overall, I would say this is not a great report, but I would not say it is a bad report. It is a steady, it is a stable market. When I look at how most of the other 19 MSAs are doing (on the Case-Shiller) index, I am very pleased.’

Barring some catastrophic event, particularly on the international scene, Niederman said he thinks the Denver market is poised to do better this year than in 2011. “This year is going to be all about consumer confidence and jobs. If we could match consumer confidence and job growth with all of the other things happening that would be very good for the housing market. And I think this being an election year might help job growth.”

He also said the entire economy, and indirectly the housing market, will benefit from the boon in apartment construction. “All of these multifamily units that are going to break ground means more demand for lumber, more steel, roofing material, appliances, mill work, trim. You name it. That is going to be very good for the economy and the construction industry. That will create jobs, which eventually will create more demand for housing.”

Good news, bad news

“I think there was some good news and there was some bad news, given the whole story of all of the numbers,” said economist Patty Silverstein, principal of Littleton-based Development Research Partners and the chief economist for the Metro Denver Economic Development Corp.

The bad news was that home prices weren’t a bit a higher, she said.

“I’m a little bit disappointed that prices didn’t come up a bit more, but the good news is that we basically were able to break even in prices,” Silverstein said. “The reality is that we were able to hold our own and not many markets across the country were able to do that, if that is any consolation to someone trying to sell their home.”

However, she said that the number of foreclosures and short sales on the market continued to drop the overall market, she said.

“Even though foreclosures were down, there are enough of them to depress overall sale prices,” she said.

She agreed with Bauer, that barring some unforeseen international or domestic even, that 2012 should be a better market than 2011.

“I think people are going to start to realize there are some tremendous deals out there,” Silverstein said.

Home builders time coming?

The dearth of resale inventory, meanwhile, presents an opportunity for home builders to fill the void.

“It’s rather surprising to me that so many people have pulled their homes off the market,” Silverstein. “Is it people are just waiting for a better time to sell, or is it a case because we have not been building anything in recent years, there is a true lack of inventory? In any case, it appears we are getting closer to the time to justify more new home building. It’s kind of exciting to consider that with just new household formations, and kids living in their parents’ basements and parents living in their kids’ basement, that people will start to push to have their own space.”

Gene Myers, president of New Town Builders, already is starting to see that happen.

Last year, his company sold 89 homes, more than double the 42 in 2010.

Encouraging factors arguing for a continued recovery in the housing market this year, he said, include:

Lots of people seeking housing, such as echo boomers and retiring baby boomers.
Rising rental renewal rates in apartments.
Low apartment vacancy rates.
Historically low mortgage rates – in some cases below 4 percent for a 30-year, fixed-rate loan for qualified buyers.
Low housing prices.

“If a (consumer) feels safe in his or her job or economic situation, now is a great time to buy,” Myers said. He said the main limit on home building growth will be the supply of available lots. “Otherwise, I could foresee another good year for building.”

Jim Nussbaum, a broker with the Kentwood Co., who is in his 41st year of selling homes, continued his practice of handing out large tins of nuts to current and past clients.

“This year I’m at the point where I handed out about 245 cans of nuts,” he said. Nussbaum said that he thinks many of the recipients believe that 2012 will be a better time to sell than 2011.

“It was such a whirlwind deal and I have to go back and check my leads, but I think I should get several listings from them,” Nussbaum said. “I think it is going to be a good year.”

However, one high-profile home is officially off the market, at least temporarily.

Kentwood Real Estate broker Jim Nussbaum stands on the estate of Jim Crowe's home in Broomfield, which Crowe has taken off the market, at least for the time being.

Jim Crowe, the CEO of Broomfield-based Level 3, has taken his Cherry Hills estate off the market, which most recently was listed at $18.9 million.

“Jim is just kind of hanging tight right now,” Nussbaum said. “He did allow me to show it one time after he took it off the market. I think if I had somebody who was really qualified, it would be Ok to do a showing.”

Nussbaum, who is the early stages of writing a book based on four decades of selling homes, however, is still listing a penthouse condominium at 25 Downing St. that is priced at $10.5 million.

“That is my longest running listing, but the sellers understand that it will take quite some time to find a buyer for a one-of-a-kind property like this one.”

Beyond homes with eight-figure price tags, Nussbaum said a number of factors have come together to make it an attractive time to buy.

“I’m telling people that interest rates are at all-time lows, the inventory is incredibly low and you have to think that people listing homes at this time are reasonably motivated. This is the time to get something accomplished.”

Selected Snapshot of inventory

Year	January	March	June	September	December
1990	14,753	16,053	16,711	14,663	11,839
1991	11,810	13,047	13,669	12,687	10,147
1992	10,568	11,842	12,602	12,540	9,631
1993	9,076	9,020	9,500	10,349	7,711
1994	7,748	7,938	9,557	10,530	8,569
1995	8,716	9,601	11,162	11,649	9,854
1996	10,196	10,628	13,499	13,584	11,000
1997	11,011	12,240	13,844	14,247	11,093
1998	11,257	8,899	13,601	13,449	10,352
1999	9,065	8,441	9,188	10,310	8,097
2000	8,010	13,147	10,482	10,998	8,820
2001	9,540	18,322	16,826	19,180	16,482
2002	16,200	23,967	21,538	23,370	20,676
2003	21,288	24,909	26,533	26,071	21,623
2004	21,946	23,023	28,043	26,975	20,891
2005	20,917	27,309	25,817	27,200	23,572
2006	24,387	26,430	31,900	31,450	24,534
2007	24,350	26,430	30,256	30,335	24,603
2008	24,489	25,516	26,104	23,923	19,600
2009	19,748	20,628	20,853	19,834	16,456
2010	17,785	20,574	23,240	23,332	18,887
2011	18,804	19,320	19,580	17,139	12,531

Year	Home closings	Sales volume	Inflation-adjusted prices in 2011 dollars
1991	26,410	$2,669,553	$4,434,162
1992	33,477	$3,572,215	$5,760,101
1993	35,598	$4,460,312	$6,983,086
1994	38.072	$4,779,902	$7,296,607
1995	36,038	$4,910,865	$7,289,927
1996	38,101	$5,515,801	$7,953,089
1997	40,185	$6,180,791	$8,712,027
1998	45,951	$7,775,673	$10,791,966
1999	46,742	$8,769,875	$11,908,802
2000	48,611	$10,558,877	$13,911,275
2001	47,832	$11,152,517	$14,254,428
2002	47,919	$11,713,824	$14,730,508
2003	47,966	$12,168,929	$14,961,830
2004	53,482	$14,223,031	$17,033,754
2005	53,106	$14,940,422	$17,307,562
2006	50,244	$14,516,321	$16,289,817
2007	49,789	$14,031,634	$15,309,857
2008	47,837	$11,954,290	$12,560,990
2009	42,070	$10,198,333	$10,754,177
2010	38,818	$9,976,222	$10,350,225
2011	39,387	$10,063,056

Source: Gary Bauer

Closings, Dollar Volume

Year	Home closings	Sales volume	Inflation-adjusted prices in 2011 dollars
1991	26,410	$2,669,553	$4,434,162
1992	33,477	$3,572,215	$5,760,101
1993	35,598	$4,460,312	$6,983,086
1994	38.072	$4,779,902	$7,296,607
1995	36,038	$4,910,865	$7,289,927
1996	38,101	$5,515,801	$7,953,089
1997	40,185	$6,180,791	$8,712,027
1998	45,951	$7,775,673	$10,791,966
1999	46,742	$8,769,875	$11,908,802
2000	48,611	$10,558,877	$13,911,275
2001	47,832	$11,152,517	$14,254,428
2002	47,919	$11,713,824	$14,730,508
2003	47,966	$12,168,929	$14,961,830
2004	53,482	$14,223,031	$17,033,754
2005	53,106	$14,940,422	$17,307,562
2006	50,244	$14,516,321	$16,289,817
2007	49,789	$14,031,634	$15,309,857
2008	47,837	$11,954,290	$12,560,990
2009	42,070	$10,198,333	$10,754,177
2010	38,818	$9,976,222	$10,350,225
2011	39,387	$10,063,056

Source: Gary Bauer

Luxury home market inventory down 34%

John Rebchook — Tue, 13 Dec 2011 15:55:59 +0000

This 10,072-square-foot, 9-bathroom, 7-bedroom home in Franktown is on the market for $1.5 million, the "sweet spot" for luxury homes in the Denver area.

The number of luxury homes on the Denver-area market have dropped by more than a third in the first 11 months of the year, when compared with the same period in 2010, according to a report released on Tuesday.

“Like every other segment of the market, the inventory of luxury listings is down in double digits,” said Gary Bauer, an independent broker who analyzed sales of homes priced at $1 million or more in the 11-county area.

“In this case, the inventory of residential (single-family homes) are down 34 percent and condos are down 22 percent,” Bauer said.

Bauer’s report shows that there are currently 650 luxury single-family homes on the market, compared with 979 during the same period last year. There are currently 74 condos priced at $1 million or more for sale, compared with 97 in the counties of Adams, Arapahoe, Boulder, Broomfield, Denver, Douglas, Elbert, Gilpin, Jefferson and Park. Last Friday, Kentwood Real Estate released a similar report that focused on the core Denver-area counties, and did not include Boulder, Gilpin or Park counties. Both reports were based on Metrolist information.

In the first 11 months of the year, a total of 463 single-family homes sold, the same as last year, while the dollar volume was down 1 percent to $704 million, compared with $712 million in the first 11 months of 2011. The average sales price was unchanged at about $1.5 million.

In the first 11 months of the year, 34 luxury condos traded hands, up 10 percent from the 31 last year. The condo sales volume as $48 million, compared with $46 million last year, a 4 percent increase. The average sales price this year as $1.4 million, down 7 percent from $1.5 million in 2010.

“Prices have been relatively stable,” Bauer said. “The sweet spot of the luxury market now is about $1.5 million.”

Bauer said those paying $1.5 million now, would likely have paid north of $2 million during the peak of the market. Buyers are purchasing them today for less than the replacement cost. That is, if they build them from scratch, it would cost more then $1.5 million.

“I do think with the inventory decreasing, we are going to see continued pressure on prices,” Bauer said.

The highest price paid this year for a single-family home was $8.2 million was a five-bedroom, 12,298-square-foot house. The most paid for a condo was $2.475 million for a three-bedroom, 2,691-square-foot unit.

Contact John Rebchook at JRCHOOK@gmail.com

Bauer tracks ‘Signature’ home sales

John Rebchook — Tue, 22 Nov 2011 22:51:26 +0000

Not that long ago, these would have been million dollar-plus homes.

Independent broker Gary Bauer, who each month tracks the luxury housing market – which he defines as those selling at $1 million or more (as well as tracking the overall Denver-area market) has sliced the housing market to a level just below the million-dollar cut off.

Today, Bauer released his first “Signature Properties” report, which tracks the sales of homes that closed between $750,000 and $999,999.

While the $1 million-plus market in the first 10 months of 2011 is flat when compared with the same period in 2010, the Signature market is up about 11 percent both in terms of closings and dollar volume.

There have been 550 single-family home sales in the Signature price range this year, representing $465.6 million in sales, compared with 494 for $418.3 million, in the first 10 months of last year.

“When I was going through the data, I noted that quite a few of what I am calling Signature homes had originally been priced at above $1 million, when we were a little closer to the top of the market,” in the 2006-2007 time frame, Bauer said

For the month of October, some 42 homes sold for $35.2 million, compared with 44 in October 2011 for $36.2 million. Last month, the average Signature sold price was $839,115 and the median sold price was $828,900.

Bauer found that 12 of the sales were in Denver, 11 in Douglas County, eight in Arapahoe County, seven in Boulder County, two in Jefferson County, and on each in Adams and Park counties.Bauer based his report on Metrolist data. He said he thinks well-heeled buyers like the idea of buying a $1 million home for $825,000.

“I think there is an advantage to that,” Bauer said.

After all, once the market start to recovers, their dream home could quickly regain the cachet of carrying a 7-figure price tag.

Contact John Rebchook at JRCHOOK@gmail.com

High-end inventory hits the skids

John Rebchook — Mon, 07 Nov 2011 19:49:07 +0000

This 4,503-square-foot home in Denver sold for $1.24 million in October.

The number of luxury homes for sale in the Denver-area is down substantially, shows a report released today by independent broker Gary Bauer.

“Similar to the rest of the market, the number of active listings in the $1 million and over market is continuing to decrease,” Bauer said. “Sales area also decreasing.”

Indeed, the unsold of inventory luxury homes has dropped even more than the overall market, Bauer’s report shows.

At the end of October, there were 762 high-priced single-family homes and condominiums on the market, a 36 percent drop from the 1,188 available through the end of October 2010. That compares to a 27.7 percent drop for the overall market, shows a previous report released by Bauer.

Kentwood’s report showed similar trend

Last week, Kentwood Real Estate released a report showing a similar trend. But while Kentwood’s report focused on the seven Denver-area counties – Adams, Arapahoe, Broomfield, Denver, Douglas, Elbert and Jefferson – Bauer’s report also included Boulder, Clear Creek, Gilpin and Park counties.

Boulder, in fact, boasted the most home sales last month, with 11 sales priced at least $1 million. It was followed by eight in Denver, six in each of Arapahoe and Douglas, and two in Jefferson. There was one condo sale last month in that lofty price range and it was in Denver.

Edie Marks, a broker with Kentwood, last week said she has noticed the dearth of supply in the price of homes in the stratosphere.

“We need more inventory,” in that price range, she said.

Bauer’s report found that 33 single-family homes in that price range sold last month, a 21.4 percent drop from the 42 in September and a 25 percent drop from the 44 in October 2010.

The average sold price of $1.39 million was 6.3 percent down from September and 3.9 percent down from October 2010. The median price of $1.275 million was down 2.1 percent from September and down 2.9 percent from October 2011. He said the “sweet spot” for luxury homes is between $1 million and $1.5 million, with those priced higher taking longer to sell

What is happening in Denver is part of a national trend, Bauer said. He was reading an article over the weekend about the lack of consumer confidence in the U.S. when it unexpectedly tied that to the luxury market.

“Caution is the name of the game,” when consumers all across the country decide to buy a luxury home, he said.

Contact John Rebchook at JRCHOOK@gmail.com

Home market holding up

John Rebchook — Wed, 02 Nov 2011 22:26:21 +0000

Home closings in October were up 12 percent from a year earlier.

The headline-grabbing number in the Denver-area housing report released today is that the unsold inventory hit a new low for 2011 in October of 15,794, almost 28 percent lower than it stood a year earlier.

The report by independent Realtor Gary Bauer also showed the last October when there were fewer unsold homes on the market was in 2000.

“It is amazing,” said Chris Mygatt, president of Coldwell Banker Residential Colorado.

However, there was more to the market than the dwindling inventory.

Overall market pretty good

“Overall, I thought the market was pretty good in October,” Bauer said. “Under contracts and closings were down a bit from September, but overall area fairly table. And while prices are down, that is largely because of the mix of homes being sold.”

There were 3,844 homes placed under contract in October, down a mere 0.1 percent from September and 3.7 percent up from the 3,706 homes placed under contract in October 2010.

An analysis by InsideRealEstateNews.com, showed that in the past 22 Octobers, the number of under contracts only increased from September six times. The 0.1 percent drop was the smallest percentage decline in the 16 years that home sales followed the typical seasonal pattern of falling off from September.

In 2008, the month-to-month change was a 14.5 percent nose-dive, for example. And it wasn’t unusual to see month-to-month drops of 5 percent, 6 percent or more.

“That doesn’t surprise me,” said Peter Niederman, CEO of Kentwood Real Estate.

A month does not make a market

“I don’t worry too much about month-to-month swings, as one month never makes a market,” Niederman continued. “That is especially true at this time of the year. October is the beginning of the fourth quarter when the housing market typically slows down for seasonal reasons.”

Closings showed a similar pattern, Bauer’s report showed, although the month-to-month drop and the year-over-year gains were greater.

There were 3,183 home closings in October, down 4.6 percent from the 3,337 in September, but up 12 percent from the 2,842 in October 2010.

In the first 10 months of the year, there were 33,163 closings, up 0.1 percent from the 33,128 in the same period in 2010.

From January through October, there were 41,176 homes placed under contract, a 5.4 percent from the 43,520 contracts during the same period last year.

The closed dollar volume is flat, with $7.4 billion in sales in the first 10 months of 2010 and 2011.

Despite steady demand and low inventory, the average price of a single-family home closed in October was $269,503, 6 percent lower than the $287,048 in October 2010 and down 4 percent from $280,289 in September.

The median price of a single-family home at $226,021, was down about 2 percent from a year earlier as well as in September.

Bauer said he thinks the main reason that home prices have dipped is because of the mix of homes being sold.

The average condo sales price in October of $160,273 was up slightly from October 2010 and September.

Low inventory bolsters home prices

However, prices would be down considerably more, if not for the low inventory, Mygatt said.

“The single biggest factor putting upward pressure on pricing is the inventory being so low,” Mygatt said. “If the inventory were not so low, we would be seeing even more downward pressure on prices.”

He agreed with Bauer that the main reason that prices are down is because of the mix of houses on the market.

Niederman pointed out not that long ago one of the main concerns facing the industry is that banks would flood the market with the so-called “shadow” inventory of foreclosures that they own, but haven’t yet put on the market.

“We do think the shadow market is real, but it is not going to cause the glut of homes on the market that a lot of pundits were predicting,” Niederman said.

“Instead of flooding the market all at once, banks are letting them out in dribs and drabs, so as not to depress prices,” he said. “They’re hoping they can get another 5 percent of 10 percent by waiting.”|

Mygatt said “the big question” for the Denver market going forward, “is what is going to happen to the inventory? That is something we are going to be watching very closely. Quite frankly, when you compare Denver to many other markets, I think we are doing exceptionally well. Our market is faring far better than many other places in the country. The big thing is, and will continue to be, job growth. I’m hopeful that people like Gov. Hickenlooper will bring more jobs to Denver. Jobs are critically important to the economy and the housing market.”

Contact John Rebchook at JRCHOOK@gmail.com

Inside Real Estate News » Gary Bauer

Buyers pay $64 million for luxury homes

Related Posts:

Luxury home market jumps

Related Posts:

Luxury home inventory plunged 35%

Related Posts:

Record inventory drop

Related Posts:

Fox shout-out to Denver

Related Posts:

Home market improves in 2011

Related Posts:

Luxury home market inventory down 34%

Related Posts:

Bauer tracks ‘Signature’ home sales

Related Posts:

High-end inventory hits the skids

Related Posts:

Home market holding up

Related Posts: