(Denver, CO– May 7, 2012) Economic and housing indicators appeared to be springing to life during 1Q12 in Denver, according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market.

Denver’s current employment estimates indicate that employers have added a whopping 33,700 jobs to their payrolls in the last 12 months. “There are signs of life in the industry this year as new home and apartment permits are reaching their highest levels since the recession began,” said John Covert, director of Metrostudy’s Colorado division. “While renewed optimism is somewhat warranted, the cold reality is permit levels are still far below the peak as well as historical norms.”

A total of 1,049 homes were started in 1Q12, up 44% from last quarter, and up 28% from 1Q11 when 819 homes were started. Builders started 3,795 homes in the last twelve months, a 5% increase from the 3,585 annual starts in 1Q11. Builders closed 1,028 units in 1Q12, an increase of 6% from the 967 closings in 1Q11. “Metrostudy expects that 2011 will be the low point for move-ins or closings and that by the end of the year starts and closings figures will be very close to one another,” said Covert.

At the end of March, there were 4,029 new homes in inventory, down 13% from a year ago and up slightly .6% from last quarter. Of that total, 1,923 are single family detached units that are either under construction, finished and vacant or decorated models. “There is a strong indication that the inventory levels have stabilized, and that builders are meeting current levels of demand,” said Covert.

“Aside from housing demand that remains low and is well under historical norms, most other economic and housing indicators appear to be springing to life. At the top of the list are the numbers of jobs added to payrolls locally this past year. Nothing else will cure the ills of consumer confidence and home buying sentiment than strong job creation,” said Covert. “The resale market is running a close second as tightening inventory is quickly shifting leverage from buyers to sellers, which will help to further stabilize prices in Denver. It’s hard not to be optimistic about the future after what the industry has just come through. However, the most successful companies will have developed a keen sense of risk awareness moving forward which will serve them well during periods of growth,” said Covert.

For information contact:
john covert @ 720.493.2020 x 201
email jcovert@metrostudy.com

About Metrostudy
Metrostudy is the leading provider of primary and secondary market information to the housing industry and related industries nationwide. In addition to providing its own primary housing data collected by a staff of 650, the company is recognized for its consulting expertise on development, marketing and economic issues, and is a key source of research studies evaluating the marketability of residential and commercial real estate projects. Services are offered through an extensive network of offices located in major metropolitan areas throughout the U.S. For more information, visit www.metrostudy.com.

(Denver, CO– February 28, 2012) Although starts slowed during 4Q11, they are expected to improve throughout 2012, according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market.

Denver’s current employment estimates indicate that employers continue to add jobs with the addition of 11,500 jobs in the last 12 months, which amounts to a 0.8% annual growth rate. “While certainly positive, the fact remains that Denver employers shed over 88,000 jobs during the downturn, and have since recovered only 23% of those jobs over the last 18 months,” said John Covert, director of Metrostudy’s Colorado division. “The market still faces headwinds. Job recovery is slow; unemployment is still high; demand for housing is still low.”

728 homes were started in 4Q11, down 38% over last quarter, and down 3% from 4Q10 when 753 homes were started. Builders started 3,571 homes in 2011, a 6% decline from the 3,784 starts in 2010. Builders started 1,664 homes January-June and 1,907 from July-December. “Lack of inventory, growing economy, improving buyer sentiment, and increases in traffic all pointed toward a stronger 2nd half of the year. Metrostudy expects this trend to continue through 2012,” said Covert.

Builders also closed 1,084 units in 4Q11, an increase of 4% from the 1,041 closings in 4Q10. There were 4,301 closings in 2011, a decline of 3% from the 4,448 closings in 2010. “Based on our forecasted increase in housing starts in 2012, Metrostudy also expects that 2011 will be the low point for move-ins or closings,” said Covert.

The supply of total inventory is at 6.9 months, which is slightly below what would be considered equilibrium for total housing inventory of 7 months.

“While housing starts will grow this year in Denver—expect around 15% increase—it won’t be widespread geographically, by price point, or product type. Careful analysis of risk and opportunity is more important than ever,” said Covert.

For information contact:
John Covert @ 720.493.2020 x 201
email jcovert@metrostudy.com

About Metrostudy
Metrostudy is the leading provider of primary and secondary market information to the housing industry and related industries nationwide. In addition to providing its own primary housing data for approximately 70% of the United States housing market, the company is recognized for its consulting expertise regarding real estate development, marketing and economic issues, and is a key source of research studies evaluating the marketability of residential and commercial real estate projects. Services are offered through an extensive network of offices located in major metropolitan areas throughout the U.S. For more information, visit www.metrostudy.com.

(Denver, CO– November 1, 2011) The worst appears behind us and the industry is finally beginning to think about the future rather than stay mired in the past, yet it’s still a daily grind to find and close buyers, according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market.

Denver’s current employment estimates indicate that employers continue to add jobs at a very slow place with the addition of +6,600 jobs from last September, which amounts to a 0.5% annual growth rate. This marks the 15th month in a row of positive job formations after 24 consecutive months of losses.

Sales of existing homes were up 13% year-to-year for the month of September following strong July and August sales. “Historically low mortgage rates this summer and more affordable prices were too attractive for some buyers to ignore,” said John Covert, director of Metrostudy’s Colorado division.

1,189 homes were started in 3Q2011, up +41% over last quarter, and up +17% from 3Q2010 when 1,020 homes were started. The 1,189 starts this quarter was the highest count since 3Q2008. “We had anticipated that an increase in starts would come in the second half of the year,” said Covert.

The supply of total inventory is at 7.9 months, which is slightly above its 10-year historical average of 7.5 months, and is within what would be considered equilibrium for total housing inventory of 7-8 months.

“Third quarter starts are up 17% year-to-year. That’s good news. While the percent change is based on a small number, it’s still a good indication that builders have some confidence in starting a few more homes. Metrostudy expects builders to start 10-15% more homes in 2012,” said Covert.

For information contact:
john covert @ 720.493.2020 x 201
email jcovert@metrostudy.com

About Metrostudy
Metrostudy is the leading provider of primary and secondary market information to the housing industry and related industries nationwide. In addition to providing its own primary housing data for approximately 70% of the United States housing market, the company is recognized for its consulting expertise regarding real estate development, marketing and economic issues, and is a key source of research studies evaluating the marketability of residential and commercial real estate projects. Services are offered through an extensive network of offices located in major metropolitan areas throughout the U.S. For more information, visit www.metrostudy.com.

I recently attended the Rocky Mountain Builder Conference in beautiful Beaver Creek, Colorado to learn about some of the innovative ideas builders are introducing to enhance the value of new homes as they begin to emerge from a long and deep housing recession.

Among the more notable include New Town Builders, a Colorado-based production builder, who was there to showcase their new program to use lumber from trees affected by pine-beetle infestation which has destroyed over 3 million acres of timber in Colorado forests. Used for framing new homes, the switch to Blue Stained Pine will help create jobs in Colorado, prop up a struggling timber industry, and perform a service to the state struggling to manage the millions of fallen trees now suffocating the forests. Colorado’s Governor, John Hickenlooper, stated that “Finding productive uses for these trees has been a priority for the state.” He continued about New Town Builders’ effort, “In so doing, we can help restore forest ecosystems, reduce wildfire threats, and protect watersheds — all while promoting jobs and local economies. New Town Builders should be applauded for using bark-beetle-kill lumber as we will continue to encourage more use of this Colorado resource.”

DOW Chemical Company also had a booth at the Builder Show Exhibit Hall introducing its new revolutionary photo voltaic solar panels. Called Powerhouse Solar Shingle, this new concept can be integrated into rooftops with Read the rest of this entry »

(Denver, CO– August 1, 2011) Consumers are skeptical of any good news about the economy and certainly the homebuilding industry absent any consistently positive reports from day to day. It remains a difficult time in Denver for both homebuilders and consumers, according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market.

Denver’s current employment estimates indicate a 0.3% annual growth rate, with the addition of +3,800 jobs from last June. “This marks the 12th month in a row of positive job formations following 24 consecutive months of losses,” said John Covert, director of Metrostudy’s Colorado division. Unemployment in Denver has dipped to 8.3% in May, compared to 8.4% a year ago.

There were 4,080 sales of existing homes in June 2011, a 0.8% increase compared to June 2010. However, year-to-date sales were down –10%. Based on annual sales there is a 5.9 month supply of listings, down from 6.2 months a year ago.

850 homes were started in 2Q11, up slightly over last quarter but down –12% from 2Q10 when 961 homes were started. Starts in the first half of 2011 were down –16% from starts in the first half of 2010. “No matter which way you slice the numbers, demand remains very weak for new houses,” said Covert.

At the end of June 2011 there were 4,462 new homes in inventory, down –16% from a year ago and down –4% from the first quarter of 2011. “It’s very unlikely we’ll see new condo development in Denver for quite some time, as attached product makes up the bulk of total inventory in the market” said Covert. Single family inventory, on the other hand, remains at very low levels with few specs available.

“Denver builders will be faced with what looks more and more like a repeat of 2010 starts volume,” said Covert. “Nonetheless, the most innovative, aggressive, and well-positioned companies are still gaining market share and have an eye on the future.”

For information contact:
john covert @ 720.493.2020 x 201
email jcovert@metrostudy.com

About Metrostudy
Metrostudy is the leading provider of primary and secondary market information to the housing industry and related industries nationwide. In addition to providing its own primary housing data for approximately 70% of the United States housing market, the company is recognized for its consulting expertise regarding real estate development, marketing and economic issues, and is a key source of research studies evaluating the marketability of residential and commercial real estate projects. Services are offered through an extensive network of offices located in major metropolitan areas throughout the U.S. For more information, visit www.metrostudy.com.

(Denver, CO– May 1, 2011) The Denver market will grow in 2011, a strong reminder that Denver builders must be planning for the immediate future, according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market.

Denver’s current employment estimates indicate that payrolls have continued their growth trend by adding +11,400 jobs from last March’s, which amounts to a 0.85% annual growth rate.

Despite the fact that the tax credit is fully behind us, there were 3,556 annual housing starts for 1Q11, an increase of +11% over the 3,198 annual starts for 1Q10. Builders also closed 978 units in the first quarter, an increase of +5% from the 928 closings in 1Q10. This was the first quarter-over-quarter increase in closings since 1Q06.

“Metrostudy believes that the 5-year decline in closings has begun to finally level off,” said John Covert, director of Metrostudy’s Colorado division, “and that the annual closings pace will remain around its current level through the remainder of 2011.”

Traffic is up 47% through the first 3 months of the year compared to last year when first time buyers were flooding the market in search of a home before the tax credit deadline. “Granted, builders were converting a much higher percentage of traffic a year ago,” Covert said, “but this may be the best indicator of all that homebuilding will grow again, maybe sooner rather than later.”

For information contact:
john covert @ 720.493.2020 x 201
email jcovert@metrostudy.com

About Metrostudy
Metrostudy is the leading provider of primary and secondary market information to the housing industry and related industries nationwide. In addition to providing its own primary housing data for approximately 70% of the United States housing market, the company is recognized for its consulting expertise regarding real estate development, marketing and economic issues, and is a key source of research studies evaluating the marketability of residential and commercial real estate projects. Services are offered through an extensive network of offices located in major metropolitan areas throughout the U.S. For more information, visit www.metrostudy.com.

(Denver, CO– February 1, 2011) Homebuilding in Denver has a big upside going into 2011, according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market.

Denver’s current employment estimates indicate that payrolls actually grew by 1,800 jobs from last November’s total, following 24 consecutive months of annual job losses. “Denver’s unemployment rate remains high at 8.5%, but a 14% decline in claims filed for unemployment insurance signals displaced workers have more employment options than they did a year ago,” said John Covert, director of Metrostudy’s Colorado division.

758 homes were started in 4Q10, up 12% from 4Q09. Annual housing starts for 2010 were up 40% over 2009 with 3,735 units started. “Starts will increase in 2011, but not to the same extent and not for the same reasons they did in 2010,” said Covert.

Builders closed on 4,394 homes in 2010, a 16% decline from 2009. The 1,029 closings in 4Q10 were down 23% from 4Q09. “Clearly, demand for housing is still in a fragile place with high unemployment and rising interest rates,” said Covert. “This economic uncertainty will eventually loosen its grip on the psyche of home buyers once job creation appears sustainable.”

“2010 will go down as the 2nd-worst year for housing construction in the last 30 years for Denver builders. Of course, 2009 was worse, and the road ahead is still clogged with roadblocks and uncertainty,” said Covert. “However, long-term, homebuilding in Denver has big upside. With a population approaching 3 million, Metrostudy believes in a ‘normalized’ year the market should be able to absorb around 15,000 homes. We expect housing starts to increase 10-20% in 2011 as job formations continue, foreclosures moderates, home prices stabilize, and consumer confidence grows.”

For information contact:
john covert @ 720.493.2020 x 201
email jcovert@metrostudy.com

About Metrostudy
Metrostudy is the leading provider of primary and secondary market information to the housing industry and related industries nationwide. In addition to providing its own primary housing data for approximately 70% of the United States housing market, the company is recognized for its consulting expertise regarding real estate development, marketing and economic issues, and is a key source of research studies evaluating the marketability of residential and commercial real estate projects. Services are offered through an extensive network of offices located in major metropolitan areas throughout the U.S. For more information, visit www.metrostudy.com.

(Denver, CO– November 1, 2010) Positive job growth could bring stability to the Denver Market, according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market.

Total employment continues to improve but still showed a month-to-month decrease for the 21st consecutive month. “Despite the long climb ahead, it appears Denver’s on the cusp of seeing positive job growth for the first time in nearly two years, a much anticipated and sorely needed remedy for an extensive list of problems we’ve been facing,” said John Covert, director of Metrostudy’s Colorado division. In the Denver MSA, the number of jobs decreased by 4,600 jobs over the last 12 months through September 2010.

According to Metrostudy’s quarterly survey, there were 1,026 home starts in 3Q10, an increase of 19% over 3Q09. “Considering the front-loaded first and second quarters due to the tax credit, the third quarter tally was a bit of a surprise. With such low levels of inventory, builder have managed to buoy interest in buying a new home,” said Covert. “Granted, builders will probably start less than 4,000 new homes for the second consecutive year, but the builders have positioned themselves to grow and the market appears to be moving in the right direction.”

The 4,742 annual closings ending for the year in September outpaced new home starts. This is a decline of 16% compared to annual closings last year. “However, closings in five of the last six quarters have been very consistent, between 1,200 and 1,300 units.

“The tax credit provided a boost to the industry, but 2011 will prove difficult in restoring confidence in widespread home buying,” said Covert. “What’s needed is sustainable, organic demand, drawing from job growth and steady in-migration. Positive job growth appears to be just around the corner in Denver, which can’t come soon enough to help further stabilize the homebuilding industry.”

For information contact:
john covert @ 720.493.2020 x 201
email jcovert@metrostudy.com

About Metrostudy
Metrostudy is the leading provider of primary and secondary market information to the housing industry and related industries nationwide. In addition to providing its own primary housing data for approximately 70% of the United States housing market, the company is recognized for its consulting expertise regarding real estate development, marketing and economic issues, and is a key source of research studies evaluating the marketability of residential and commercial real estate projects. Services are offered through an extensive network of offices located in major metropolitan areas throughout the U.S. For more information, visit www.metrostudy.com.

Today’s Census Bureau report showed that new home sales were unchanged.  For the moment, let’s put aside the amusing fact that in the official release, they say with a straight face that the percentage change was ‘zero’… plus or minus 16.7%. We know that their survey is prone to major error.  I correctly predicted that the July number would be revised upward, based upon the magnitude of changes I had observed in our own much-more-granular and much-more-current Traffic and Contracts Survey.

The good news, though, is that the currently deeply-depressed level of new home sales is a result of an artificially low level of demand that is a direct result of the borrowing of demand from this period by the period in which the tax credit was in effect.  Within a couple more months, we will see demand go back up to a more normal level, up from the recent abysmal levels.

A key observation I would like to make is that a zero change in the ‘national’ number obscures some significant ups and downs in various individual markets.   The government data only tell a very superficial and bland story, but the actual activity is all over the place.

Case in point:  our data showed that Denver had a large upward spike in traffic in August (but the conversion rates were very poor).  The result is that sales per subdivision drifted lower during the month.

A few other examples of crosscurrents:

In Southern California, sales paces per subdivision are HALF of the level they were in May (May was actually the recent tax-credit-induced peak in this market).  Sales are still sliding downward, well below last year’s level, and seem like they may go below the 2008 level very soon.

San Diego’s sales paces are just seesawing month to month, down a bit in August after an increase in July, and they are back up to a slightly higher level as of September.

The level of buyer traffic in Phoenix is struggling its way off the floor, rising, but still far lower than a year ago, and lower than earlier years as well.  Sales per subdivision in Phoenix are flat, at half of last year’s absorption levels, but on par with 2008.  Cancellation rates are dropping, but they remain higher than a year ago.

(Denver, CO– August 1, 2010) Metro Denver existing home sales year-to-date is
up 8% compared to the first 6 months in 2009, having closed 20,990 homes. April and May were particularly strong months, both up about 20% from the previous year driven by the tax credit, according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the U.S. housing market.

“While we won’t know its full impact of the tax credit for some time, we do know that demand for new homes was likely pulled forward this past year,” said John Covert, director of Metrostudy’s Colorado division.

Price levels of homes indicate that first-time home buyers helped drive sales. By the end of June, 51% of the homes started since 2Q09 we were priced below $300,000, compared to 2 years ago when these homes only made up 24% of starts. “In the past year, those 1st time and entry level buyers have helped salvage an industry that was on its knees with a 130% increase in starts under $250,000,” said Covert. “Besides drawing out first-time buyers, the tax credit has had the added effect of creating some move-up opportunities, where after selling their existing homes to entry-level buyers, a smattering of move-up buyers have entered the playing field once again.”

Housing starts are also up, with 1,050 homes started in 2Q10, up from 664 homes started in 2Q09. This follows an 88% increase in starts during the first quarter of 2010. However, these positive trends must be factored in with the entire housing market picture. “While this may look and sound impressive, the reality in a broader sense depicts a more subtle change in direction for the housing market,” said Covert. A few of these factors include the tax credit, low numbers in 2009 (the lowest in 25 years), and low inventory levels necessitating an increase once demand picked up.

Also, the local Denver economic situation will affect the housing market for the remainder of 2010. Current estimates indicate that Metro Denver average annual employment fell 2.9% over the past 12 months. “With a sputtering economic situation locally, housing starts for the remainder of the year will almost certainly remain muted,” said Covert.

For information contact:
john covert @ 720.493.2020 x 201
email jcovert@metrostudy.com