Monday, April 29, 2013

First Quarter 2013 metro Denver apartment vacancies and rents

The apartment vacancy rate in the Denver metro area fell to 4.6 percent during the first quarter of 2013, dropping to the second-lowest vacancy rate recorded in any quarter since the first quarter of 2001. According to a report released Monday by the Apartment Association of Metro Denver and the Colorado Division of Housing, the metro Denver vacancy rate was down from 2012’s first-quarter rate of 4.9 percent, and was also down from last year’s fourth-quarter rate of 4.9 percent.

For the past fourteen quarters, the vacancy rate has fallen when compared to the same quarter one year earlier. The last time the quarterly vacancy rate rose year over year was during the third quarter of 2009.

From the first quarter of 2012 to the same period of 2013, the vacancy rate dropped in Arapahoe County, Jefferson County, and the Boulder Broomfield area. The rate rose in Adams County, Denver County, and Douglas County during the same period.

“The number of new apartments delivered has increased rapidly since 2010, but the numbers haven’t been large enough so far to push vacancy rates up significantly, said Ryan McMaken, an economist with the Colorado Division of Housing. “We do see some submarkets where vacancies are temporarily up as new communities lease up, but that’s not indicative of a decline in demand.”

As vacancy rates moved down, the area’s average rent increased to the highest level recorded in any quarter. During the first quarter of 2013, the average rent in metro Denver rose to $992, increasing 4.2 percent, or $40, from 2012’s first-quarter average rent of $952.

The average rent rose in all counties measured except Adams County, with the largest increases found in Douglas County and in the Boulder/Broomfield area where the average rents grew year over year by 6.9 percent and 7.4 percent, respectively. 

The county areas with the highest average rents were Douglas County and the Boulder/Broomfield area where the average rents were $1,186 and $1,150, respectively. Adams County reported the lowest average rent at $910.

“Rent growth is solid, and even when adjusted for inflation, the average rent is almost to a nine-year high,” McMaken said.

2013’s first-quarter vacancy rates by county were Adams, 5.2 percent; Arapahoe, 4.1 percent; Boulder/Broomfield, 3.2 percent; Denver, 5.4 percent; Douglas, 6.5 percent; Jefferson, 3.7 percent.

Average rents for all counties were: Adams, $910; Arapahoe, $950; Boulder/Broomfield, $1,150; Denver, $1,008; Douglas, $1,186; and Jefferson, $958.

Wednesday, April 24, 2013

March unemployment in Colorado dips to 7.1 percent, remains below national unemployment rate of 7.6 percent


Colorado 's unemployment rate dipped further below the national unemployment rate in March, dropping to 7.1 percent in Colorado compared to 7.6 percent for the nation overall. (These are seasonally adjusted numbers.)

The seasonally-adjusted unemployment rate for Colorado during March was 7.2 percent, and it was 7.7 percent for the nation.

Colorado's seasonally-adjusted unemployment rate was down year over year in March, dropping year over year from 8.2 percent during March 2012 to 7.1 percent during March 2013.

The national unemployment rate also fell at the national level, year over year, with a drop from 8.2 percent during March 2012 to 7.6 percent during March 2013.

The graph shows a comparison between the two rates since 2006 through March 2013:


See here for the employment article archive. 

Friday, April 19, 2013

Housing News Digest, April 19

Homeowners can expect continued decline in assessed property values County assessors will send hundreds of thousands of property-valuation notices out in coming days, and the flat or declining values that many will show could surprise some homeowners. Property valuations are made per state law every two years, and the latest assessments will be used in the formula that determines property taxes due in 2014 and 2015.

  Colorado adds few new jobs in March; unemployment eases to 7.1% Colorado added just 500 new payroll jobs in March, a much smaller gain than the previous month, while the state's unemployment rate eased to 7.1 percent, the lowest since January 2009, the Colorado Department of Labor and Employment reported Friday.

  Economist says Colorado economy strong but warns of U.S. slowdown An economist told Colorado builders and contractors Thursday that the United States will probably see an economic slowdown in 2013. But Anirban Basu, chairman and CEO of Sage Policy Group, said the outlook for Colorado is much brighter, with a strongly recovering economy that is likely to remain that way.

  Morguard North American Residential REIT Completes Acquisition of Six Multi-Unit Residential Assets in the U.S. for US$218 Million The six properties acquired are residential apartment and townhome complexes comprised of 1,793 suites located in Denver, Colorado, Tampa, Florida, Cary, North Carolina and Atlanta, Georgia. The properties are best-in-class low rise, enclave assets with structured and surface parking, modern leasing centers and amenity packages with a weighted average age from construction of 11 years.

  New home construction hits prerecession mark Northern Colorado is doing at least as well or a little better, according to local homebuilders. “It would take a pretty big wrench to throw us off track,” said Greg Miedema, executive director of the Home Builders Association of Northern Colorado.

Wednesday, April 17, 2013

LPS: Colorado reports sixth-lowest rate of non-current loans during February

According to the February LPS Mortgage Monitor , released last week by Lender Processing Services, 10.2 percent of mortgage loans during February were "non-current" in the United States. That is, they were 90-plus-days delinquent or were in foreclosure.

In Colorado, the percentage of active mortgage loans that were non-current during February was 5.2 percent, which was down 18.1 percent from the same period last year.  Colorado's year-over-year decline in non-current loans was the 4th largest in the nation. Only California Arizona, and Minnesota showed larger declines.

Only five states reported lower percentages of non-current loans than Colorado, making Colorado 6th-best in the nation for the percentage of its mortgage loans that were non-current during February 2013. Montana, Wyoming, South Dakota, Alaska and North Dakota reported lower percentages of non-current loans during February.

The states with the highest rates of non-current loans were Florida, New Jersey, and Mississippi with non-current  rates of 18.5 percent, 16.3 percent and 16.0 percent, respectively.

According to LPS: "LPS Mortgage Monitor is an in-depth report of mortgage industry performance. The monthly report is based on data from the company’s market-leading repository of loan-level residential mortgage data and performance information, including more than 40 million active loans across the credit spectrum. This data is analyzed by LPS experts to produce more than 30 charts and graphs reflecting both trend and point-in-time performance observations."

Corelogic: Home price index up 10.5 percent in Colorado for February

Corelogic's home price index for Colorado increased year over year for the thirteenth month in a row during February 2013, increasing yet again to the highest growth rate seen since the beginning of the recession in 2008.


Colorado showed a 10.5 percent increase from February 2012 to February 2013. The February HPI report, released last week by Corelogic, shows the national HPI rising by 10.2 percent, year over year. Since mid-2012, year-over-year growth in the HPI for Colorado has been robust, as inventory continues to decline and demand for home purchase remains steady or increasing among Colorado residents.



Recent increases reflect ongoing very-low mortgage rates helped by ongoing monetary easing at The Fed. At this time, low interest rates look to continue, and as population and employment continues to grow in Colorado, demand for purchase homes will remain. Nationwide, growth has not been as  strong as the nationwide HPI continues to be pulled down a bit by relatively weak home purchase activity in the old Rest Belt areas such as Ohio and Pennsylvania.

See the home price archive for comparisons with other indices.

The CoreLogic HPI reflects ongoing home price growth that we also see in several other home price indices such as those form FHFA and Case-Shiller.

In the February report, six states reported larger year-over-year increases than Colorado. The states with the largest increases were Nevada, Arizona, and California with increases of 19.3 percent, 18.6 percent, and 15.3 percent, respectively.  Only three states showed declines in the index, and were Illinois, Alabama and Delaware, with drops of 1.0 percent, 1.5 percent, and 4.4 percent, respectively.

Beige Book: District Ten sees growth at a 'moderate pace'

The Federal Reserve System released its Beige Book economic summary today. According to the national report: 

Reports from the twelve Federal Reserve Districts suggest overall economic activity expanded at a moderate pace during the reporting period from late February to early April. Activity in the Cleveland, Richmond, St. Louis, Minneapolis, and Kansas City Districts was characterized as growing at a moderate pace, while the Boston, Philadelphia, Atlanta, Chicago, and San Francisco Districts noted modest growth. The New York and Dallas Districts indicated that the pace of expansion accelerated slightly since the previous Beige Book.

According to the report from the Kansas City Fed's district, which includes Colorado, 'expectations for future activity strengthened.'

'Residential real estate activity rose sharply in March, and commercial real estate activity strengthened' while in banking, banks reported 'stable loan demand, improving loan quality, and stronger deposits.'

See the full KC district report




First Quarter 2013 'Housing Snapshot' now available



The statewide Housing Snapshot is now available. The statewide snapshot is a brief look at recent trends in employment, rental housing, home prices, and permits.

This issue looks at some of the housing stats released early this year, reflecting late 2012 and early 2013 trends.

Click here for the latest issue.


Buildfax: Remodeling activity in US West up 12 percent in February

According to Buildfax, remodeling activity during February 2013 was up 12 percent from February 2012 in the U.S. West region. Data is based on counts of remodels authorized by building permits in the U.S. This was the largest year-over-year increase among all regions.


According to the press release:

National Residential Remodeling
Residential remodels authorized by building permits in the United States in February were at a seasonally-adjusted annual rate of 3,299,000. This is 2 percent below the revised January rate of 3,360,000 and is 8 percent above the February 2012 estimate of 3,051,000.
Regional Residential Remodeling
Seasonally-adjusted annual rates of remodeling across the country in February 2013 are estimated as follows: Northeast, 446,000 (up 4% from January and up 4% from February 2012); South, 1,340,000 (up 2% from January and up 7% from February 2012); Midwest, 716,000 (down 17% from January and up 2% from February 2012); West, 846,000 (down 5% from January and up 12% from February 2012).

U-Haul: Denver 19th of 30 top US cities for growth

U-Haul puts out analyses of move-ins and destinations for truck renters periodically. They have recently released their list for 2012 for top-growth cities, which shows Denver 19th of the 30 top cities for growth.

Pittsburgh and Henderson, Nevada topped the list.

Denver's ranking slipped from 2011 to 2012. Back in 2011, Nashville and Oakland topped the list, while Denver came in third.

In 2010, Colorado Springs made the list at number 13 out of 30, and Denver did not make the list at all.

Housing News Digest, April 17

Cuts by Military Test Colorado Property Prices A Colorado Springs, Colo., office portfolio is testing investor concerns over federal spending cuts. Corporate Office Properties Trust a Columbia, Md., real-estate investment trust and office landlord to government agencies and defense contractors—is getting bids this month on 16 Colorado buildings.

  McWhinney announces new apartment project LOVELAND,COLO.– Loveland-based developer McWhinney will break ground on its fifth apartment project in Westminster this month to help meet the region's on-going record demand for apartments. The vacancy rate for Westminster stood at 4.3 percent at the end of 2012, according to the Apartment Association of Metro Denver. It is the most recent data available. "Rates are as low as they have been in years….and that gives everyone permission to build again," said Christopher Dean, marketing and communications director for the Apartment Association of Metro Denver.

  Ground broken on $25 m apartment project near Park Hill Golf Course Ground has been broken on the Park Hill Apartment development, a $25 million, 168-unit multifamily complex, adjacent to the Park Hill Golf Course and future light rail stop on Colorado Boulevard.

  New bill seeks to clarify Colorado water law in wake of Sterling Ranch ruling Two Colorado legislators have introduced a bill clarifying a state law requiring developers to prove they have enough water to local governments when a development permit is submitted.

  Colorado economic group deems Windsor small community of the year The praise and proverbial pats-on-the-back highlighting Windsor as a good business community keep piling up. The Economic Development Council of Colorado on April 4 named Windsor the “small community of the year” ­— one of only two such awards the group doles out each year. The town was hailed for its efforts to attract and grow businesses and development within the community. “I am very honored to work on economic development efforts for the town of Windsor,” said Stacy Johnson, the town’s economic development manager. “We have such an amazing and dedicated team and incredibly talented group of community partners …

Monday, April 15, 2013

Housing News Digest, April 15

Adams County drawing residents from across the metro area Valerie Gonzalez and Rich Rojas wanted to stay in Denver when the Park Hill home they were renting went into foreclosure in 2009. They searched dozens of homes but failed to find anything that could meet their $200,000 price point and didn't need extensive remodeling or require living in a higher-crime neighborhood.

  Commercial real estate market improves in Colorado Springs Commercial real estate space in Colorado Springs is slightly harder to come by now, indicating the market has seen a slight improvement, The Gazette reports. The combined vacancy rate for the three commercial real estate sectors -- office, industrial and retail -- dipped to 11.5 percent in the first quarter. The vacancy rate in both the first and last quarters of 2012 was 11.9 percent.

  Residential real estate staging a comeback The Colorado Springs residential real estate market has more than just rebounded. It’s on fire. “This is probably the best market for selling a house in 12 years,” said Prudential Rocky Mountain Realtor Sylvia Jennings. And she’s not the only one with that kind of news.

  Housing market heats up with multiple offers, bidding wars DENVER - The Denver-area housing market is quickly heating up, with many sellers getting multiple offers and even bidding wars on the first day. When Martin Tremblay started house hunting two weeks ago, he thought he had found the perfect Aurora home, but the first day on the market, the seller had three offers. "We didn't get the home, even though we went above asking price," said Tremblay.

  Springs housing market recovery continues Home sales and prices increased again last month in the Pikes Peak region, another sign that the area’s housing recovery is continuing. “We’re not fixed, but we’re on the mend,” said Joe Clement, broker-owner of Re/Max Properties in Colorado Springs. A Pikes Peak Association of Realtors report released this week shows:

  Springs housing market recovery continues The number of real estate appraisers is dwindling nationally, creating career opportunities for analytical math-savvy individuals interested in commercial real estate. The Appraisal Institute released a report this week noting that the number of practicing real estate appraisers in the country dropped 3 percent in 2012 and could plummet 25 to 35 percent in the next 10 years because more than half of real estate appraisers are aged 51 to 65.

Monday, April 8, 2013

Maps of high-income households and poverty rates

Source: Visualizing Economics 






Canceled: State Housing Board Meeting - April 9, 2013

Please note that State Housing Board retreat is canceled for tomorrow, April 9, 2013 due to weather concerns.

Friday, April 5, 2013

HUD Code and Modular Home Installation Training


An Installation Continuing Education Workshop on April 22nd, 2013
HUD Code and Modular Home Installation

Join us in Aurora to learn the latest in Home Installation!


This Course has been approved for 8 hours of Colorado required continuing education
for installers and inspectors!

NEW INSTRUCTOR—RICK TERRY
NEW INFORMATION—BLOWER DOOR TESTING

RMHA will be providing training in October 2013 in the Grand Junction. Exact
date and location TBD. There are only two trainings provided each year so
please plan accordingly.

Click here for registration information.

Upcoming Training: Building Zero Net-energy Homes

Is the Housing Market Ready for Zero Net-Energy Ready Homes? DOE Challenge Home Training

Two Training Options Available

5/1/2013
When: Wednesday May 1, 2013
1- 5 pm
Where: Bellvue Grange - Southwest corner of Mountain Avenue & No County Road 23
2929 N Cnty Rd 23
Bellvue, Colorado 80512
United States
Online registration is available until: 5/2/2013

Employment in Colorado metro areas: Denver and Colorado Springs unemployment heads downward


Total employment growth in Colorado in February continued at a solid pace during February according to the most recent emploment data Employment trends in various regions of the state differ, however, so this article looks at which regions of the state have the highest unemployment rates, and which regions have recovered the most in their labor markets. 

Regional employment trends can also provide us with some insights into local housing demand since, all things being equal, those areas with the most robust labor demand will also have the strongest demand for housing. This would be reflected in apartment vacancy rates and in median home price and home sales transactions, among other indicators. 

The first graph compares unemployment rates in Colorado's metro areas.

The regional unemployment rates (not seasonally adjusted) for February 2013 are:
Colorado Springs, 8.7%
Denver-Aurora, 7.4%
Fort Collins-Loveland, 6.5%
Grand Junction, 9.1%
Greeley, 8.7%
Pueblo, 10.6%
Statewide, 7.6%

Since mid-2009, The Fort Collins-Loveland area has consistently shown one of the lowest unemployment rates while Pueblo's unemployment rate has been above ten percent for over a year now. Over the past year, however, The Colorado Springs unemployment rate has stalled above 8 percent, and the Grand Junction unemployment rate had been heading up since fall 2012, but fell slightly in February.   

All areas have shown declines in the unemployment rate from February 2012 to February 2013, though. Recent revisions to the employment data also pushed up the February 2012 unemployment rate in most metros from what had been previously reported. 

The unemployment rate ticked up noticably in the Greeley and Ft. Collins-Loveland areas in recent months. This is being at least partially driven by the fact that the Greeley and Ft. Collins areas are seeing some of the biggest growth in total labor force size right now. If labor force growth exceeds employment growth, this will push up the unemployment rate. As the Greeley and Ft. Collins areas have seen some of the most robust job growth in recent months, this has encouraged some local workers to re-enter the work force. 

To provide some additional context, we can look to see how far below total employment levels are below the most recent peak in employment in each region. The peak time differs in each region. For example, the labor market peaked in mid-2007 in the Colorado Springs area, but it did not peak until late 2008 in the Grand Junction area. 

The following numbers reflect how far below the most recent peak are the February 2013 employment totals: 

Colorado Springs MSA, 5.7%
Denver-Aurora MSA, 2.4%
Fort Collins-Loveland MSA, 3.8%
Grand Junction MSA, 12.0%
Greeley MSA 3.2%
Pueblo MSA, 3.2%
Statewide, 3.3%

All things being equal, the areas further below the peak have recovered the least from initial job losses.  In general, all areas have shown some movement back toward peak levels in recent months. 

(Note: If we include the Boulder-Longmont MSA, we find that the Boulder area has consistently been among the areas with the lowest unemployment rate. In February 2013, the rate in the Boulder-Longmont area was 5.7%.)

Colorado payroll employment up in February, unemployment rate falls from 2012


The non-seasonally-adjusted unemployment rate fell from 8.7 percent during February 2012 to 7.6 percent during February 2013. This large downward movement reflects a new revision in the employment data for February of last year, in which the unemployment rate is now reported as being higher than what was previously reported.

According to the most recent employment data, collected through the Household Survey and released this week by the Colorado Department of Labor and Employment and the BLS, both the labor force and the employment total increased from February 2012 to February 2013, with the labor force rising 0.8 percent, and total employment rising 2.1 percent, year over year.

With the labor force growing less than total employment, the unemployment rate dropped.

During February 2013, the labor force consisted of 2.75 million workers, while total employment was at 2.54 million employed persons.

According to the Household Survey employment totals, total employment remains approximately 88,000 employed persons below the employment peak reached during July 2008.

The first graph shows the unemployment rate (not seasonally adjusted):



The unemployment rate inches downward, helped along by little labor force growth and some small gains in total employment.

The second graph shows total employment is up from levels seen during 2009 and 2010, but for the past six months or so, has been largely flat.  Given February 2012's upward revision in the unemployment rate, it may be that revised numbers, still unavailable for most of 2012, will show more improvement over the past six months.  Total labor force is nearly back to peak levels.


Total employment, according to the Household Survey, is now back at levels reported during early 2007.

The employment situation looks better if we consult the other measure of employment, the Establishment Survey. This is a survey of payroll employment at larger employers.

The third graph shows payroll employment collected through the Establishment Survey of employment, and shows the year-over-year change in payroll employment in Colorado. While the Household Survey showed employment rising by 2.1 percent, the Establishment Survey shows total payroll employment growing by 2.9 percent (or 66,000 jobs) from February 2012 to February 2013. The Establishment survey uses a larger sample size, but does not measure employment activity among small firms.

Year-over-year growth in the Establishment Survey has been growing consistently since 2011. February's year-over-year change was the largest measured since 2006.

The very large losses that occurred during 2009 and 2010 were the largest losses, by percentage, in at least 30 years. Job gains in recent years don't compare with the robust job gains seen during the boom years of the 1990s.


Taking seasonal issues into account, employment, as measured by the Establishment Survey, is essentially back to peak levels - 2.3 million payroll jobs or so. 

This disparity between the Household Survey and the Establishment survey can be interpreted in a variety of ways.  It certainly suggests that job growth among larger employers has been solid over the past year. The small job gains in the Household Survey, however, suggests that employment among the self employed, and those at small firms has been less robust.