Colorado Mortgage and Housing Status: Solid as a Rock in Boulder

By Richard Barrington
Local Lender Columnist
May 23, 2008
As the name would suggest, Boulder, Colorado has been a solid fixture in the real estate market. This is in contrast to many other parts of the country, where mortgage foreclosures and economic concerns have led to slumping prices. Colorado's real estate market has remained healthier than the national average and this is especially true in Boulder. This stability benefits far more people than just those looking to sell their homes. Stable prices support home equity values, an important source of borrowing collateral.

Forces of Supply and Demand

Real estate is a market driven by forces of supply and demand. When the balance between supply and demand changes the impact on prices can be dramatic.

In much of the country, the roots of the housing slump can be seen on both sides of the equation. As mortgage foreclosures have risen, distressed sales have put many more houses on the market, creating a flood of supply. At the same time, economic concerns and tighter mortgage lending standards have dried up demand.

One measurable result of this has been a sharp drop in housing sales volume across the country, which has pushed housing prices lower. In contrast though, Colorado has fared better. While monthly sales volume dropped 22.9% across the country over the past year, Colorado's sales volume fell only 9.3%. Sales volume in the Boulder region has held up even better, falling only 4.2% over the same period.

Supporting Home Equity

Stronger support for prices has preserved the home equity values of Boulder home owners. This can create a positive cycle: continued access to home equity for borrowing contributes to the local economy; a healthy economy, in turn, helps support those real estate values. All of which has made the Boulder market as solid as the name itself.

Source:
USA Today

About the Author
Richard Barrington is a freelance writer and novelist who previously spent over twenty years as an investment industry executive.