Signature home sales steam ahead | Inside Real Estate News

This 2,886-square-foot home in the Country Club neighborhood of Denver sold in November of $875,000, classifying it as a Signature property.

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Sales of ?Signature? homes in the Denver area priced just below $1 million surged by 47 percent in November compared with November 2011, according to a report released today by Gary Bauer.

The analysis of Metrolist data by Bauer, an independent broker, shows there were 72 single-family detached home sales in November, compared with 49 a year earlier.

Bauer is the current chairman of Metrolist, which collects and publish a wide-ranging amount of real estate information on the Multiple Listing Service (MLS), but Bauer?s report was released as an independent Realtor, not in any official capacity at Metrolist.

Buyers paid a total of $61.2 million for Signature homes last month, a 48.5 percent increase from the $41.2 million a year earlier. The average price per square foot rose almost 12 percent to $285 from $255 a year earlier. The price per square foot was up 6.7 percent from $267 in October.

?November was another excellent month for Signature sales,? Bauer said.

?Sales were so strong for two reasons,? Bauer said. ?First, is the fact that consumer confidence is increasing again. We are seeing home buyers looking for their dream homes.?

Signature buyers, typically those making their third or fourth move-up move, or in some cases downsizing from even bigger, more expensive homes, also find value in homes priced from $750,000 to $999,999, Bauer said.

?Especially near the top of the price range, buyers realize that not long ago these homes would have sold for $1 million or $1.2 million,? Bauer said. ?They are seeing a lot of value in homes in this price range.?

Bauer also has heard that a number of buyers in this price range are paying cash and putting a new loan on the property within 60 days after closing.

?We are seeing that,? said Susan Gumm, branch manager for Universal Lending Corp.?s Lakewood office.

?We are seeing quite a few investors paying cash for properties and then flipping them,? she said. ?I feel really sorry for our first-time home buyers who have to compete with investors paying cash. It is tough.?

In other cases, investors are taking advantage of the strong rental market with plans to sell the homes when the market gets even stronger. Those investors sometimes will pay initially pay cash and later put a new loan on the property, she said.

Of course, she said, buyers in the high-end range are more likely to be owner-occupants, because the rental market isn?t as strong in the price range.

Still, there is a high-end rental market and some investors, she said, are using IRA and other retirement money to pay cash for expensive homes and later put a loan on the home.

?When you think about it, a number of people in that price range lost their homes to foreclosure and often can?t buy another home for seven years,? Gumm said. ?It?s very sad. But you can see that means there is a built-in rental market for several more years.?

Cheryl Shaul, a broker with Red Collar International, said even wealthy people who could afford to pay cash for homes, almost always prefer to get a loan, considering that rates today are as close to ?free? money as anytime in modern history.

?Cash buyers are obviously perfect,? Shaul said.

She said in November she closed on three high-end homes, one in the Residences at Four Seasons, another downtown and one near the University of Denver.

?Two went as smoothly as they could be,? Shaul said. ?The third was a real estate investor who made a big down payment. He who owns a lot of real estate. It was an absolute nightmare to get it closed. So closings are unpredictable. Lenders are doing a lot more due diligence than they ever have before.?

Not only are more Signature homes selling, but they are selling faster. The average days on market was 112, down 27.3 percent from 154 in November 2011.

In the first 11 months of the year. buyers paid $667.8 million for 767 single-family homes, compared with $505.9 million for 599 Signature homes during the same period of 2011. That is a 31.4 percent increase in sales and a 32 percent increase in dollar volume.

Percentage gains in Signature condo sales were even greater, although the numbers were much smaller.

In the first 11 months of the year, 63 Signature condos sold for $53.8 million, compared with 38 for $32.3 million during the same period in 2011, a 66.5 percent increase in dollar volume and a 65.8 percent in sales. Seven of the condo sales took place last month, compared with five in October and six in November 2011.

Have a story idea or real estate tip? Contact John Rebchook at JRCHOOK@gmail.com. InsideRealEstateNews.com is sponsored by Universal Lending, Land Title Guarantee and 8z Real Estate. To read more articles by John Rebchook, subscribe to the Colorado Real Estate Journal.

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Source: http://insiderealestatenews.com/2012/12/signature-home-sales-rise-47/

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