Discover Denver Luxury Homes & Real Estate - Kelli Lanphere - Excellence in Real Estate Since 1984 -

The year 2005 was the Year of the Bubble - or perhaps more accurately, the Year of Talk of the Bubble. Conjecture about the Bubble. Fear that the Bubble would burst. Open The Wall Street Journal, turn on the national news, read the latest business magazine, and you could almost guarantee finding a story about the imminent crash of the housing market. It was so inevitable and so close, many predicted, that you wondered if you should shield your ears from the impending "pop".

Now that we have somehow made it to 2006 without a housing catastrophe, we can relax, right? Wrong. The March/April 2006 issue of AARP magazine ponders the question yet again in a five-page article entitled, "Is the Real Estate Bubble About to Burst?" and the subject remains hot on TV and radio, with pundits arguing about exactly where and when the big bang will occur.

Don't get me wrong: All of this bubble-talk does have some basis in reality. When median prices in Miami and Las Vegas have risen 90 percent between 2002 and June 2005, and when the median price in Phoenix jumped 55 percent in just one year, there is reason to wonder, "How high can prices go?" and "When will they start falling?"

Here in metro Denver, things are quieter on the housing front, and for that, we can be grateful. The dramatic rise in home values in Florida, the Northeast and the Southwest that has fueled the doomsday bubble scenario simply hasn't taken place in our corner of the real estate world. In a September 2005 study of the most overvalued and undervalued U.S. housing markets by National City Corp. and Global Insight, 65 of the 299 biggest U.S. housing markets were shown to be severely overvalued (from 30 percent to 84 percent overpriced) and subject to possible price corrections. The same report ranked Denver at number 153 on the list, judging our housing market to be just 10 percent overvalued. Being in the middle of the pack in this instance is a good thing, an ideal place to help ensure that we never experience the exploding bubble that could someday affect the nation's red-hot real estate markets.

Denver's housing market in 2005 was strong without being overheated, with the median price of a single-family home increasing 4.4 percent from the previous year. In some of the city's most popular neighborhoods, we still see home sales steady.

Homes in desirable neighborhoods that are in excellent condition and priced right are selling quickly and, we have been seeing multiple offers on the best of the best. That trend should continue in 2006, as real estate remains an outstanding long-term investment and our metro-area economy continues to improve. Even if interest rates climb to near 7 percent by year end, as some analysts predict, that remains a low rate by historical standards and one that should keep buyers in the market.

As always, my team is here to help you buy or sell a home at any time and to make the most of today's market conditions, whatever they may be. We look forward to serving you in 2006.

Kelli Lanphere is a Broker/Co-owner of Re/Max of Cherry Creek, Inc. and Team Leader for The Denver Team. She has also been the contributing writer for the real estate section of The Cherry Creek Times (a monthly community publication serving our local neighborhoods: Cherry Creek, Denver Country Club, Hilltop-Crestmoor, Belcaro, Bonnie Brae, Washington Park, Congress Park, Park Hill, Mayfair & Lowry) for several years and is recognized as a proven expert in residential real estate.

To send Kelli an e-mail, click here: kelli@thedenverteam.com

* * * Kelli Lanphere - Selling Denver's Top Neighborhoods Since 1984 * * *

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