Oakwood Homes President Pat Hamill shows his new Fairway Villas models at Green Valley Ranch Golf Club. Designed for 55-and-older buyers, they re bringing us unbelievable traffic, he said.

Builder Dave Mandarich, with 35 business years and 167,000 homes behind him, is putting a pencil to Colorado's indicators for 2012 and likes what he sees. "People are more confident," he said from Richmond American's headquarters in the Denver Tech Center. "They really don't want to be renters, they're feeling better about jobs, and rates are at a career low." Adding those up, Richmond American is launching a new model series -- and opening the throttles a little at master-planned locations such as Banning Lewis Ranch near Colorado Springs.

With lots of depth in markets that are bigger than Colorado's even in a bad year, Richmond American is sensing a "sweet spot" here - and other builders are nodding their heads in

Richmond American Homes American Dream collection will be priced from $199,950, with a large bedroom count and lots of standard features, including granite

"We're fortunate having a market that's stabilized," says Pat Hamill, whose Oakwood Homes ranks third behind Richmond in total sales, but is Colorado's largest privately-held builder and highest seller-per-community. That includes Thompson River Ranch, a master-plan in Loveland's I-25/Centerra corridor, which Hamill says is top-seller in northern Colorado, benefitting from new NASA jobs and other arrivals.

"The whole housing market got the swine flu," Hamill reflected; "but now local markets are emerging. We're seeing lower inventory, net in-migration of around 38,000 (in Denver metro), and huge positive job growth -- the first in four years. Consumer indices show people are starting to feel better."

In addition to some job growth, all builders are focused on the favorable inventory side - down drastically over 2010 according to market analyst Jack O'Connor with The Denver 100, whose latest report shows metro Denver's 8,854 active homes-for-sale as having dropped a whopping 36.5% over the year. They're also, adds Hamill, noting the fact that the so many builder-competitors disappeared during that four-year drought - around 40% to 45% of the competing market, he says.

For Oakwood, that's expected to render around 40% more sales in 2012, showcased from nine new communities Hamill expects to open (a few will also close as they reach sell-out). But while Richmond's Mandarich sees the best opportunities at the low end where inventory is lowest (his new American Dream series is priced from just $199,950), Hamill and other builders are watching for openings in the pricier move-up and move-down product ranges, as well.

"We view re-sales as our primary competition," says David Bracht, Lennar's Colorado Division president, adding that many homes for sale in the supply-side have terrible energy bills and other deficiencies that could eventually cost a buyer between $10,000 and $30,000 in remediation. "We're trying to have homes available for anybody in the market," Bracht added. That includes in Denver's Southeast corridor, where Lennar is feeling good about its offerings that edge into the $300,000 to $500,000 range, many with upgrades such as hardwood floors, fancier cabinets and smart-home features included in the price.

Dan Nickless, president of Ryland's Colorado division agrees, showing new offerings around Boulder-Louisville, northern Colorado, and Castle Rock. "Some of the inventory you see out there are marginal properties. The more people can move from their existing properties, the more that gives them the opportunity to get into a new home, with a more livable floorplan as well as more energy efficiency."

Mark Samuelson writes on real estate and business; you can email him at mark@samuelsonassoc.com.

NEW YORK — Better news on home sales and improved prospects for job growth sent stocks higher on Wall Street on Thursday.

The Dow Jones​ industrial average rose 136 points, nearly making up its 140-point loss from the day before. The Standard & Poor​'s 500 edged back into the black for 2011 with one more day of trading left in the year.

The four-week average of unemployment claims fell to a 3 1/2-year low, an indication that hiring could pick up. Also, the number of Americans who signed contracts to buy homes in November rose more than 7 percent to the highest level in a year and a half, according to the National Association of Realtors.

Quincy Krosby, Prudential Financial​'s market strategist, said the reports were encouraging signals for the economy going into 2012.

"The correlation between jobs and housing has been crystal-clear this year," Krosby said. "Parts of the country where jobs are more plentiful are the ones where the housing market has held up."

Krosby said the correlation has become more pronounced after the real-estate bust, when lenders became reluctant to even consider customers for a mortgage unless they held jobs. She said it's a noticeable trend in many cities nationwide.

The positive housing news sent the stocks of homebuilders sharply higher. Masco soared 8.4 percent, the most in the S&P 500. Pulte Group rose 6 percent, and Lennar gained 4.6 percent.

The Dow closed at 12,287.04, a gain of 135.63 points, or 1.1 percent. For the year, the Dow is up 709 points, or 6 percent.

The S&P 500 rose 13.38 points, or 1.1 percent, to 1,263.02. That's five points above where the index started the year.

The technology-heavy Nasdaq composite rose 23.76 points, or 0.9 percent, to 2,613.74. The index is down 39 points for the year.

Trading was very light as investors get ready to close the books on 2011. Markets are closed Monday in observance of New Year's Day, which falls on Sunday.

The euro went as low as $1.28 against the dollar, its weakest since September 2010. The euro also fell to its lowest against the Japanese yen in a decade.

Investors continued to be worried that Italy's 10-year borrowing rate remains uncomfortably close to 7 percent, a level that economists consider unsustainable. Greece, Ireland and Portugal all had to seek relief from their creditors after their 10-year bond yields rose above 7 percent.

First-time applications for unemployment benefits fell 4,000 to a seasonally adjusted 364,000, the Labor Department said Thursday. It was the third straight weekly drop.

The four-week moving average, a less volatile gauge, fell for the 11th time in 13 weeks. At 380,250, it's the lowest since June 2008. Applications generally must fall below 375,000—consistently—before hiring is strong enough to reduce the unemployment rate.

Unemployment applications are a measure of the pace of layoffs. Job cuts have fallen sharply since the recession, though many employers remain slow to start hiring.

The declining number of applications suggests that the economy may finally be regaining strength, 2 1/2 years after the Great Recession ended. The nation added at least 100,000 jobs every month from July through November, the first five-month streak since 2006.

"When you fire fewer people, hiring unquestionably follows," said Dan Greenhaus, chief global strategist at BTIG LLC.

If unemployment applications continue declining, Greenhaus said, the number of jobs created each month will rise to 200,000 and the unemployment rate might fall as low as 8 percent before November's elections.

In the past three months, employers have added an average of 143,000 net jobs a month. That compares with an average of 84,000 in the previous three months.

More small businesses plan to hire than at any time in three years, a trade group said last week. A separate private-sector survey found more companies are planning to add workers than at any time since 2008.

Overall economic growth appears to be tracking the job market's improvement. The economy was barely growing when the year started. In the final quarter, growth might exceed 3 percent, up from 2 percent in the July-September period.

Still, applications for unemployment benefits are above the level needed to lower the unemployment rate significantly. The four-week moving average for new claims has exceeded that number since June 2008. Unemployment has been above 8 percent for almost three years.

Before the recession, there generally were 280,000 to 350,000 new applications for unemployment benefits each week. The number peaked at 659,000 in March 2009.

The unemployment rate fell in November to 8.6 percent from 9 percent, but about half that decline occurred because many of the unemployed gave up looking for work. When people stop looking for a job, they're no longer counted as unemployed.

And weak hiring doesn't always appear in unemployment claims data. Employers slashed payrolls deeply during the recession. If they're worried about the slow pace of recovery, they may hold off layoffs—but not hire, either.

The figures come as Congress appears close to going home without extending emergency unemployment benefits, which are set to expire at the end of the year.

About 6.7 million people are receiving unemployment benefits. About 2.2 million of them will lose their benefits by mid-February and 3.6 million others will lose theirs by the end of March if Congress doesn't extend the emergency benefits.

Lawmakers are deadlocked over continuing the program, which is attached to legislation that would extend a Social Security tax cut.

House Republicans rejected a two-month extension passed by a bipartisan majority in the Senate. President Barack Obama has called on lawmakers to approve the short-term measure so that they will have time to negotiate a full-year extension.

If Congress doesn't renew the two measures for 2012, economists say, the economy's growth could slow by as much as 1 percentage point

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Colorado's Front Range​ is sitting on top of as much as a billion barrels of oil, which could inject $4 billion a year in revenues into Colorado's economy, according to one estimate.

Houston-based Anadarko made the oil-reserve estimate based on 11 horizontal wells it drilled in the Wattenberg Field in Weld County.

The company put the range of the reserves as equivalent to 500 million to 1.5 billion barrels of oil — about 70 percent of the production in oil, the rest in natural gas.

"This is going to have huge implications for the economy of Colorado," said Pete Stark, vice president for industry relations at IHS, a Denver-based consulting firm.

A reserve that size could generate 150,000 barrels a day and, assuming oil is $80 a barrel, provide more than $4 billion in annual revenues, Stark estimated.

The total value of goods and services produced in the state in 2010 was $235.15 billion.

"Anadarko's announcement today shows once again that Colorado is a leader in the energy sector of our country's economy," Gov. John Hickenlooper said in a statement Monday. "We are thrilled to see the company plan a significant investment in Colorado."

Anadarko's wells had initial production averages of 800 barrels a day — with the best well producing 1,100 barrels a day.

The wells were drilled in the Niobrara formation, which is more than 6,000 feet deep and runs from El Paso County to the Wyoming border.

To get oil from the shale layer, companies drill horizontally through a formation and "hydrofracture" the well — pumping in water, sand and chemicals under pressure to break up the rock.

Anadarko said it also found oil in the neighboring Codell formation. While a "significant" shale discovery, it is smaller than the 9 billion-barrel reserve in North Dakota's Bakken Field, Stark said.

Anadarko plans to quadruple its drilling pace to 160 wells a year and drill between 1,200 and 2,700 wells in the Wattenberg Field.

The cost of each well has averaged between $4 million and $5 million, said John Christian sen, an Anadarko spokesman.

The Anadarko estimate is just for the 100-square-mile Wattenberg Field, which includes Weld County and small parts of Adams, Broomfield, Boulder and Larimer counties.

Anadarko is also doing exploratory drilling in Arapahoe County, and Chesapeake Energy​ has filed plans to drill in Elbert and Douglas counties.

Ultra Petroleum is set to drill exploration wells in El Paso County.

"The Anadarko results don't say anything about the prospects to the south," said Ward Polzin, a managing director at Tudor, Picking & Co., an energy investment bank.

The Wattenberg was always seen as the most promising area, Polzin said.

"What this does is give drillers through the area more confidence," Polzin said.

The prospect of accelerated drilling raises concerns among environmental groups.

"The announcement is a mixed bag," said Gary Wockner, director of the Clean Water Action and Clean Water Fund in Colorado. "Every well that is drilled takes more water and poses pollution from fracking fluids."

"We think the economics of these wells are very good," Christiansen said.

Anadarko holds interests in more than 350,000 net acres in the Wattenberg Field and operates more than 5,200 existing wells.

Outside the Wattenberg, Anadarko holds another 550,000 acres in Colorado.

Mark Jaffe: 303-954-1912 or mjaffe@denverpost.com