West is looking cool, except for hottest markets
Utah "did not really participate in the boom," he says. "So there is a little catch-up impact. The second reason is that jobs are coming around very strongly."
In parts of Arizona and Nevada, real estate speculators entering, then leaving, the market had an effect. "There now is an excessive supply -- close to 10 months," says Yun. That, he says, will likely diminish prices. A healthy local economy and strong job growth is helping, he says. "There are plenty of buyers, but there are plenty of sellers," says Yun.
"The rest of the West, I
think, will be one of the better performing
markets" in 2007, says Yun.
Go east young man
One phenomenon he credits: Many Californians are "moving out and choosing nearby states," he says. "And they are bringing their equity with them." In addition, the job market is "very strong throughout the West," he says.
In some western cities, like Denver, inventories are high. In other areas, like Portland and Seattle, there are additional homes, "but there are still some buyers" so while it's been a buyer's market, it's "definitely a tighter market than the rest of the country," Yun says.
Denver homes are staying on the market three to four months, says Kit Cowperthwaite, president of the Colorado Association of Realtors. But January sales rates were up about 25 percent from last year and average home prices are still rising. In 2006, appreciation was at about 3 percent, he says. This year, housing starts have been down so there are less new homes on the market, he says.
"We're cautiously bullish," says Cowperthwaite. "It's still a buyer's market, but reasonably strong."
"Prices have stabilized," says Carol Dozois, a regional vice president for the NAR with a territory that includes Washington, Oregon, Idaho, Montana and Alaska. "In a few select areas it may have dropped slightly, but ever so slightly."
In Eugene Ore., where she works, she's seeing homes stay on the market 30 to 45 days. But her area also saw appreciation during the second half of 2006. "As long as interest rates stay down and supply does not substantially increase, the market's going to stay healthy," Dozois says.
Many experienced pros, which recognize
the cyclic nature of real estate, aren't worried.
"This is my thirtieth year in the business,"
says Chuck Edell, president of the Bay East
Association of Realtors, who practices out of
Freemont, Calif. "This is a healthy, normal
market. Agents who have been in the business
five years don't know what a normal market would
And the outlook for homeowners is bright in 2007.
"We wouldn't be surprised
to see home prices increase 10 percent"
in parts of Washington, Oregon, Idaho, Utah,
Colorado and New Mexico, says Yun. In Arizona
and Nevada, "there's a huge inventory out
here," he says. "At the same time,
job growth is the fastest of the country. And
rents are rising so fast; close to 10 percent.
I think that will force some of the renters
to enter the housing market."
As a region, the West is "where the excitement will be," says Yun.
Dozois agrees. "I just think this will be a really good year for real estate."
Related story: See
what $400,000 will buy across the country.