U.S. home resales in March suffered their biggest monthly slump since the late 1980s, while metro Denver’s home resales show signs of stabilizing.
Home values nationally declined slightly in March, while annual price declines in metro Denver were larger, suggesting that the metro area may be further along in the natural cycle of the housing slump than the rest of the country.
The national numbers were contained in a report Tuesday from the National Association of Realtors. The Colorado numbers were released earlier this month by independent real estate analyst Gary Bauer.
In metro Denver, home resales were down 3 percent in March from the same period a year ago. The median price of single- family homes also fell 3 percent as foreclosures pushed down home values.
Large parts of the metro area are holding up, real estate agents say, and higher-end homes continue to show price appreciation.
“Our business is up over the same time last year. We are seeing calls every week from buyers,” said Randy Hay, a broker with Keller Williams Executive in Highlands Ranch.
While interest from homebuyers in the metro area is up, completed deals are not, said Duane Whisler, broker-owner of Team Whisler Metro Brokers in Arvada.
“People’s interest in wanting to do something has gotten stronger,” Whisler said. Still, he said: “The consummation is not there.”
Foreclosures and short sales, in which borrowers sell a home for less than what they owe on a mortgage, are keeping inventories high and pushing prices down.
Whisler said he worked with a client wanting to sell in the Club Crest neighborhood of Arvada. Of the 29 homes recently listed there, 13 were foreclosures that were priced below the owner-occupied homes. The rest of the country appears to be following a path metro-area residents know well – slumping home sales and rising inventories, followed by accelerating price declines.
Home resales in the U.S. fell to an annualized pace of 6.12 million, an 8.4 percent decline from February. The monthly decline reversed three consecutive months of gains and was the largest slump since January 1989, when annualized sales fell 12.6 percent.
“People were ready to say the housing market had turned the corner. If you look closely at the numbers, it didn’t happen,” said Michael Kone, an analyst with Housingmetrics in Boulder.
Month to month, national home resales fell from 554,000 in March 2006 to 482,000 in March of this year, a 13 percent decline. Median home prices fell 0.3 percent over the same period, the eighth month that prices have recorded a year-over-year decline.
David Lereah, chief economist with the Realtors association, attributed the March slump to poor weather in February, which delayed the home-hunting season, and to a contraction in the subprime mortgage market.
Kone said the ease of selling a home comes down to two factors: its price and how many nearby homes are in foreclosure.
“We are seeing the weakness on the low end of the market still,” Kone said. “There are a lot of these pockets of weakness. It is very neighborhood specific and price-point specific.”
Staff writer Aldo Svaldi can be reached at 303-954-1410 or asvaldi@denverpost.com.
