Let’s take a minute and talk about some key indicators in the real estate market and what the data from Metrolist tells us about the health of local real estate.

First, inventory has been stable and it’s been remarkably low. For at least the last 18 months, we’ve been hearing rumor after rumor from “industry insiders” that banks were getting ready to flood the market with a massive amount of foreclosures. I hear it and I hear it, but it doesn’t happen. We’re all grateful it hasn’t happened and as a result, if you take a look at inventory as of the date of this column, there are only 21,000 single family homes and condominiums on the active market. That’s low for this time of year and it’s only up 1% from this time last year. Conclusion: inventory is low, has remained low, and probably will stay low for a while which means less choices for the buyer and better prices for sellers.

Sold data is what we all want to know about and it gives us some of the best news of the all the numbers. Sold homes and condos are up 16% from last month and 23% from this time last year. Better yet, average days on market are down 7% from last month and 22% from last year. To top that, the average sold price rose 7% from this time last year.

There is good news with homes that are under contracts as well. Homes that are under contracts are up 12% from last month and 27% percent from last year. That 27% represents the most significant change in all of the market data.

Combine this information with the data that was released about positive job growth in March, April, and May and you start to have a good feeling about the recovery. There is pent up demand by home buyers and now we are starting to see those results. Remember, jobs and real estate are always the last indictors to come around for a recovering economy and with positive news in both sectors, maybe we are out of the woods.

Dan Polimino is a Realtor with Fuller Sotheby’s International Realty. He can be reached at DPolimino@fullerproperties.com and www.coloradodreamhouse.com/denverpost

Over the last several months, I have been hearing horror stories about there being 5 years, or 10 years, or 12 years of luxury property inventory on the market. After a little investigation, I did not find that to be true. Let me say that as of the day that I am writing this column, I am using data that was pulled from Metrolist, and then applied a simple absorption rate equation to determine the supply of inventory. As criteria, I looked at all the homes over one million dollars in a particular city, and looked at the sales from the last 12 months. With that disclaimer out of the way, here is what I have found.

Cherry Hills Village has less than two years’ worth of luxury homes on the market. Greenwood Village has less than two years of inventory on the market. Lone Tree has exactly two years’ worth of inventory, and Denver has only about 15 months. To some, this may seem like a large supply, but in reality, given the market, it’s not and here’s why. First off, total inventory across Colorado is very low right now and has been for the last several months. There are at least three good reasons for this: 1) Distressed properties are getting bought up. 2) Some people have decided not to sell their home. 3) Building new homes has slowed considerably over the last several years. There’s also another reason to be optimistic. We are just beginning our prime selling season. So while more homes will come on the market, more will also get sold.

Finally, I did find some market with more inventory than others. Overall, parts of Douglas County can have up to three and half years’ worth of inventory. It really doesn’t matter if you are in an area that has two years’ worth of inventory or three because in this market, every seller needs to be smart with their pricing. Your home will sell. You have to find a way to make your home stand out in the crowd.

Next week, we’ll talk about how you can make your home shine for every showing.

Dan Polimino is a Realtor with Fuller Sotheby’s International Realty. He can be reached at DPolimino@fullerproperties.com and www.coloradodreamhouse.com/denverpost

I know mortgage lenders are always talking about this and advertising this, but we hear it so much that we forget to pay attention to it. If you really stop and think about it, interest rates may be the biggest influence on whether we can buy or not. Let’s face it, the vast majority of the population buy based on what they can afford in a monthly mortgage payment. Nothing affects that more or greater than the interest rate. Let’s take a look at a snap shot of a few figures to see the real impact when interest rates rise and what that does to your monthly payments.

According to Metrolist, at the end of 2009 the average price for a single family home was $281K. For this example, let’s call it an even $280,000 and let’s also base all of our calculations on a 30-year-fixed. We’ll take a look at a 5% loan, a 6%, and a 7%. We are also all in agreement that it’s unlikely that interest rates will go lower and the reality is that they are only going high from here.

1. $280,000 at 5% = 1,503 P&I
2. $280,000 at 6% = 1,678 P&I
3. $280,000 at 7% = 1,862 P&I

Just the jump from 5% to 6% almost added $200 a month to your payment and we still haven’t added in taxes and insurance yet. If you have to add mortgage insurance, you could be easily looking at $2000 a month. It adds up quickly and that’s why interest rate is such an important factor. It’s also the main reason why I tell people who are on the fence about buying now or waiting not to wait any longer.

Dan Polimino is a Realtor with Fuller Sotheby’s International Realty. He can be reached at DPolimino@fullerproperties.com and www.coloradodreamhouse.com/denverpost