The real estate market here in Boulder remains competitive, with property prices continuing to rise. According to Boulder County Market Insights, average home sale prices in the city saw an 8.45% increase from last winter. With its high demand and low inventory, many may find Boulder’s dynamic housing market difficult to navigate.
A Sellers’ Market
Due to the limited number of listings and Boulder’s strict development regulations, sellers currently control the market. Many homes for sale receive multiple offers, making them go for up to 25% more than their original asking price. Townhomes that were $300,000 are now going for $400,000 or higher with multiple offers, while well-priced luxury homes immediately receive multiple offers and rarely remain on the market for more than several days.
But sellers should not underestimate all incoming residents determined to buy a home. Buyers moving from a city with a fierce housing market—like Los Angeles, San Francisco or New York—will be able to recognize overpriced listings. These types of discerning buyers are not afraid to bid aggressively for a house that they really want and they are often all-cash clients.
Pitfalls of FSBO
While Boulder’s real estate market does favor the seller, it does not guarantee a favorable transaction for every seller. In addition to savvy buyers, there are also buyers in Boulder who are frustrated with For Sale By Owner (FSBO) listings. Not only is it discouraging for buyers to have to deal with an inexperienced homeowner, but it’s also unwise for owners to think they can complete a successful transaction on their own.
Homeowners who take on full responsibility of selling a home (rather than hiring realtors) jeopardize their opportunity for getting the best price for their property. Trying to save money by avoiding a realtor’s commission actually ends up costing sellers more money in the long run since most FSBO homes are undersold by 20%, in comparison to similar properties listed with realtors. In a market, like the one we are seeing in 2015, a realtor’s negotiation skills are paramount in bringing it up to 25% over asking. Asking price is a science, not a whim.
New residents looking to buy a home should be cautious of doing things on their own, too. Many first time buyers or Millennials like the idea of finding listings online without the help of a realtor. But online research can’t replace an experienced realtor who has deep roots in the community, is familiar with every neighborhood, understands the city’s micro market, and has access to listings not always available on public real estate sites. With a growing market in North Boulder/Gunbarrel, as well as the nearby cities of Longmont, Louisville and Lafayette, both new and longtime residents looking to buy in Boulder will want to seek out professional guidance.
Boulder’s real estate market is more combative and nuanced than it appears on the surface and that’s why the traditional realtor model still predominates in the city. Both sellers and buyers who work with realtors, as opposed to those who opt out, continue to benefit from the agent-client relationship. When dealing with such a major financial transaction, in a city with a highly competitive market, it’s best to have a professional working solely as your advocate. A realtor’s superior knowledge and invested support can make all the difference in a real estate deal, especially in Boulder.