Recently, we have been running into some buyers that are still looking for that killer deal. You know what I am talking about, it’s the foreclosure that was at six million, now only 3 million and the buyer thinks he can get the bank to take 1.5 million. Unfortunately, those days are over in Colorado. Here are the stats that buyers need to know:
1) Luxury inventory is down 47 percent from last year. Less options means higher prices. Those that had to sell did.
2) Start of 2012, Colorado was named the number one real estate market in the country by Money Magazine, FOX News and MSN. As we approach the final quarter of the year everything indicates they were correct.
3) Overall inventory in Colorado remained at an all-time low.
4) There probably will be more foreclosures to come on the market in the next 12-18 months…BUT
a. They will most likely be in Florida, California, Arizona and Nevada. Colorado was the first state into the foreclosure crisis and we were the first to come out. This state has largely purged itself of foreclosures.
b. If banks do release more foreclosures, I can almost guarantee that there will not be a massive dump, but rather practice the same policy they have followed for the last few years. They will continue to trickle them out a few at a time. This will ensure stable or higher pricing.
5) The bottom of the market in Colorado was really in February of 2011, and since that time, we have seen a remarkable turnaround in pricing and sales.
I think at some point, agents need to have a heart to heart talk with buyers and set expectations. Don’t get me wrong; I have no problem with people trying to get the best deal they can, but they also need to understand the current market. This is not like 2008, 2009, or 2010 when buyers could just wait out sellers. The reality is if this buyer does not want to pay the current asking price, there is another buyer right behind that will. That could not be said in the previous three years.
The final analysis is there still is some wiggle room in luxury properties, but not like what we have seen over the last few years. Waiting to see if we have another drop in real estate is not likely and in fact, higher interest rates will only ensure a buying frenzy.
Dan Polimino is an Owner/Broker with Keller Williams Realty DTC. He can be reached at firstname.lastname@example.org