Good afternoon everyone! Since it’s a slow news day, I have an announcement and a housing forecast for you.
First off, we’re very proud to announce Erickson Realty’s brand new mobile app! I’m biased of course, but I’d compare its performance to many of the popular real estate apps. Bear in mind it is currently just Northern Colorado, but if there’s demand for other areas we will consider adding them. More details can be found on OUR WEBSITE or you can go here: https://ericksonrealty.hsidx.com/ or simply search “Erickson Realty” on the App Store or Google Play. Also happy to text an invite to anybody if this is all pops and buzzes.
Couple of reasons why this is a big deal to us. First, I was disturbed to discover how many of the big sites attempt to lure clients away from their agents. Secondly, and somewhat related, we’re not going to track or sell any of your search data. As people have rightfully become more concerned about what happens to their data, we’re proud to put something in people’s hands they can feel safe using. Although our MLS system has piles of granular criteria fields, what’s in the app should be enough to paint a realistic picture of the homes available within your parameters. And if you aren’t seeing any inventory, well, more on that in a minute. Of course we’re only a message away and we look forward to any feedback on the app’s performance and welcome all comments and reviews!
So what else is going on with the NoCo real estate market besides cool local phone apps? And what WILL happen? The beginning of the year is always about webinars and (once upon a time) in-person seminars where various experts wax poetic over graphs showing an endless stairway to heaven. This year was *slightly* different, as much of the discussion centered around the “what-ifs” of Covid, and the widespread adoption of a vaccine. Biggest factor in our industry right now is a lack of inventory, something that isn’t going to magically change overnight, or overyear, as it were. The effects of the virus impacted the workforce as well as supply costs, namely lumber. One economist reported a 70% increase in lumber costs during 2020, and I’ve read reports suggesting this has added roughly $16,000 to the cost of the average new build. And this is at a time when builders are trying to hit the below-average-to-average price points that are critical for meeting demand. Bottom line, it ain’t gonna happen anytime soon.
Fortunately, rates are providing many folks with a buying power, or a refinancing power, that we’ve simply never had before. People of a certain age may remember when mortgage rates were 18%+. Various banks, mortgage groups and other experts have thrown predictions out from 2.88% - 3.3% as the par rate range for 2021. In other words, if you haven’t taken advantage of rates in some way, you still have plenty of time. You may even be able to take advantage more than once.
And how could one take advantage of rates? Since rents are high and mortgage rates are historically low, renters should endeavor to weigh the financial pros of home ownership against the cons of a tight marketplace. If you’re a landlord, there's been an uptick in that sector for reasons I can’t really explain. Inventory is still absorbed quickly, but the fact that income properties are hitting the market with some regularity is refreshing. And finally, if your entire family can be heard during your important Zoom call, perhaps consider upgrading - either by getting into something better suited to working from home, or doing a cash-out refinance to renovate a home office space (or a scream booth).
Mudrooms, green cabinets, and dedicated Zoom rooms are supposedly some of the new must-haves. I have yet to have any buyers demand these things, but then again I never thought of myself as someone who would have a special microphone for Zoom calls and curtains to cover my ugly closet doors.
Bottom line: Expect an even greater dearth of inventory to offset the plateauing of values. Prices should go up 5-10%, depending on which city, and segment, of Northern Colorado you’re in.
This was intended to be brief! I thank you for taking the time to read this and welcome all to reach out with questions/comments and hope you enjoy the app! If you want specific stats you can always go to our website or just reach out to me.
Crip Erickson, Owner/Managing Broker