Colorado Real Estate Market Conditions

Sales of homes in the Million-Dollar market are starting to show life.

Homes in the million-dollar market are not setting any records, but the greater majority of these seven-figure homes selling from Boulder to Douglas counties, are not being sold at foreclosure prices either.

Luxury homes in Colorado still remain sluggish in the Denver luxury real estate housing market, and have not been commanding record prices that had excited sellers and builders four or five years ago at the peak of the market. Sellers seem to have made a modest profit or break even point on the vast majority of homes closed in July, indicates an analysis of homes sold by InsideRealestatenews.com.

Overall, $63.4 million paid for 44 single family homes in Adams, Arapahoe, Boulder, Broomfield, Denver, Douglas and Jefferson counties are based on figures supplied to InsideRealEstateNews by Metrolist.

Luxury homes that sold were priced to market

Of the 44 Colorado luxury homes in total that were listed for $68.7 million across these counties, they sold for an asking price on average of 92.3 percent of the original asking price. The analysis included the price per square foot of each of the homes and public records were used to see whether it sold for a profit. Since some of these homes were new-builds it became difficult to determine if a profit was made since they had not been previously sold or a builder bought a vacant lot or a small house that was razed and skewed the results.  The “Actual Value” was used as a proxy for a previous sale. This is what county assessors use to determine the assessed value of homes for property taxes.

Time of purchase and location is key

If you bought during the peak years of 2005 to 2006 when prices were going through the roof, then you were more than likely to take a loss. If you purchased in certain neighborhoods in the Denver area, as well as the Boulder real estate areas which have held their values vs. neighborhoods in many suburban enclaves that lost their value then you were more than likely going to suffer a loss. For those of you with seven-figure homes and you don’t have to sell, then don’t but if you must, then list it at the market.

Unfortunately it is still a buyer’s market.

The $1 million to $2 million market are the homes where you can expect to buy at around 70 cents on the dollar or even in some cases for even less. When you get into the $3.5 million and up buyer, those buyers are not impacted by interest rates.  These buyer’s usually pay cash and don’t need the jumbo-financing. 

Fire sale not lighting the market

If you think you can buy these expensive homes at fire-sale prices than think again since this may be true for only homes bought at the peak of the market from 2004 through 2007 in certain neighborhoods.  The good news is that people are pricing their homes to the market which means few days on the market and getting close to their asking price.

Buyer’s are getting great deals especially since there a now more jumbo mortgages available at attractive interest rates. Just a year ago, financing for these homes were basically non-existent.  Has the market hit bottom in the Colorado luxury homes market, no one knows but if you find the home that you can afford and fits your needs and the needs of your family and you love it, then you should buy it.