May 16, 2011

HARRY’S WEEKLY UPDATE
A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTAIL real estate MARKET

CITY SALES TAX COLLECTIONS JUMP IN APRIL

Colorado Springs sales tax collections in April rose by the largest percentage since October, increasing 7.85 percent from the same month a year earlier, the city reported Wednesday.

Sales tax collections have now posted year-over-year gains for 18 consecutive months, but gains had dwindled in recent months and were less than 1 percent in the previous month. Collections so far this year are up 4.46 percent from a year ago. But despite the April gains, collections are still down 6.74 percent from peak levels in 2007.

April collections reflect purchases made in March. The gain comes as the Springs area unemployment rate fell in March by the greatest percentage in more than 10 years, from 10.2 percent in February to 9.7 percent.

Fred Crowley, senior economist for the Southern Colorado Economic Forum, said, “The April increase is good and welcome, but may not be sustainable,” he said. “People aren’t getting raises and are spending more on gas, so they will have to cut spending elsewhere.”

 

Combined sales and use tax collections in April were up 6.83 percent from a year ago to $10.55 million and are up 1.68 percent so far this year.

Why it’s important: Sales and use tax collections fund more than half of the city’s annual budget for police and fire protection, roads and other services. Sales tax is also a primary measurement of consumer spending, making it a key barometer of the vitality of the local economy.

NATIONALLY, HOME VALUES DECLINE AS HOME SALES INCREASE ………
BUT COLORADO SPRINGS’ HOME VALUES ARE HOLDING STEADY

First, let’s talk about home values

According to Daily real estate News, May 10, 2011, in most states, Home values posted the largest decline in the first quarter since late 2008.

Home values (i.e. selling prices) fell 3% in the first quarter from the previous quarter and 1.1% in March from the previous month, pushed down by an abundance of foreclosed homes on the market, according to data released Monday. Prices have now fallen for 57 consecutive months and only 22% of metro areas showed any increase at all since 2009.

However, Lawrence Yun, NAR chief economist, pointed out that home prices are all over the map. “The reading of quarterly price data can be volatile because they are based on the types of homes that are sold during the quarter. When buyers principally purchase distressed properties in a given market, the recorded prices will be very low, which is what we’re seeing now in much of the country,” he said.

The national median existing single-family home price was $158,700 in the first quarter, down 4.6 percent from $166,400 in the first quarter of 2010. (The median is where half sold for more and half sold for less).

In the first quarter, the median existing single-family home price rose in only 34 out of 153 metropolitan statistical areas from the first quarter of 2010, including four with double-digit increases; one was unchanged and 118 areas showed price declines.

One big reason for the decline in values (i.e. selling prices) was the national inventory of Distressed Sales (i.e foreclosures and short-sales) which is forcing artificially low prices on all sales.

In the West, the median existing single-family home price fell 4.7 percent to $197,400 in the first quarter from the first quarter of 2010.

Keep in mind that, during this same period, the Colorado Springs market has shown relatively steady home values for the past four quarters, and has outperformed most other markets, according to the NAR quarterly report of the top 153 cities in the U.S.

During the past year, the national decline in home values was 4.6%, while the Colorado Springs average home value has gone from $184,800 in 2010 to $184,300 in 2011….That’s terrific. !!!

. . …….In terms of home-value, Colorado Springs is definitely better off than most other metropolitan areas in the country.

Now, let’s look at national home-sales

In spite of the national decline in home value, home sales have risen in most states

Existing-home sales continued to recover in the first quarter with gains in 49 states and the District of Columbia, while 22 percent of metropolitan areas saw prices rise from a year ago, according to the latest survey by the NATIONAL ASSOCIATION OF REALTORS®.

Total state existing-home sales, including single-family homes and condos, rose 8.3 percent to a seasonally adjusted annual rate of 5.14 million in the first quarter from 4.75 million in the fourth quarter, and are only 0.8 percent below a 5.18 million pace during the same period in 2010.

Lawrence Yun noted that lower priced homes have seen the best sales performance. “The biggest sales increase has been in the lower price ranges, which are popular with investors and cash buyers,” he said. “The preponderance of sales activity at the lower end is bringing down the median price, so what we’re seeing is the result of a change in the composition of home sales.”

“The rising sales trend in nearly all states is a part of the healing process to clear off inventory. Sales need to rise before prices can firm up,” Yun added.

Although sales are slightly below a year ago, the volume of homes sold for $100,000 or less in the first quarter was 8.9 percent higher than the first quarter of 2010, creating a downward skew on the overall median price.

Existing-home sales in the West jumped 13.5 percent in the first quarter to a level of 1.29 million and are 2.1 percent above a year ago.

The share of all-cash home purchases rose to 33 percent in the first quarter from 27 percent in the first quarter of 2010….a good indication that Investors are seriously into the market.

Who’s Buying?

First of all, there are more Investors in the national market

Investors accounted for 21 percent of first quarter transactions, up from 18 percent a year ago, while first-time buyers purchased 32 percent of homes, down from 42 percent in the first quarter of 2010 when a tax credit was in place. Repeat buyers accounted for a 47 percent market share in the first quarter, up from 40 percent a year earlier.

Some other interesting data show that First-time buyers are down (32% in the first quarter of 2011 vs 42% in 2010) …a reflection on the fact that the federal tax credit did, indeed, result in more sales last year. Repeat buyers are up from 2010 (47% in 2011 vs 40% in 2010).

In addition to the fact that Colorado Springs home values are holding steady, the bottom line for our local economy is that the Business Conditions Index …the overview of all aspects of the Colorado Springs economy issued by UCCS, has grown by 22% in April 2011 vs Feb 2009. That’s quite a leap and a good indicator that our city and our real estate market are moving in the right direction.

If you would like to discuss our local real estate market, Call us at 598-3200,or,1-800-677-MOVE(6683)

PROPOSED HOUSING FINANCE MARKET REFORM MUST ENSURE MORTGAGE AFFORDABILITY, ACCORDING TO NAR

Reforms to America’s housing finance market must ensure a reliable source of affordable mortgage lending for creditworthy consumers. That’s according to REALTORS® and other industry insiders who examined the federal government’s future role in the secondary mortgage market at the “Fannie Mae & Freddie Mac: Obama Options and Beyond” session during the National Association of REALTORS® 2011 Midyear Legislative Meetings & Trade Expo.

Some of the views expressed at the meeting about reforming the government-sponsored enterprises (GSEs) were:

• Reform is required
• Taxpayers must be protected from losses
• The federal government must continue to play a role in the secondary mortgage market to ensure a steady flow of mortgage liquidity in all markets under all economic conditions.
• Reform of the secondary mortgage market needs to be comprehensive and undertaken methodically.
• The government’s large presence in the housing finance is unhealthy and needs to be scaled back.
• Private capital needs to return to the housing finance market, but that most likely won’t happen until the market has stabilized.
• There needs to be more accountability and transparency in the secondary mortgage market so that private investors can best assess their risk and safely get back into the market.
• There should be a very limited government role in the secondary mortgage market.
• The private capital market has the funds and capacity to absorb Fannie Mae and Freddie Mac’s market share.
• Some government backstop will be essential in the future, since the housing and finance markets are sensitive to booms and busts.

Speakers reported that the government’s stated primary objective appears to be twofold: First, to lay out an immediate near-term path for reform, with steps that could be taken the next few years to reduce taxpayer risk and move the housing market to more stable footing, and second, to frame the discussion regarding the government’s long-term role in housing finance.

This topic will continue to be debated in the near-future, as the government decides the future of Fannie Mae and Freddie Mac.

MORTGAGE RATES DROP TO LOWEST LEVEL OF YEAR

According to the Wall Street Journal, May 13, 2011, Mortgage rates declined for the fourth straight week and reached their lowest levels of 2011.

The 30-year fixed-rate mortgage averaged 4.63 percent this week, reports Freddie Mac in its weekly mortgage market survey. Last week, the 30-year mortgage stood at 4.71 percent; compared to last year at this time, it averaged 4.93 percent.

Meanwhile, the 15-year fixed-rate mortgage also reached its lowest level of the year, averaging 3.82 percent this week from 3.89 percent last week. Last year at this time, the 15-year mortgage averaged 4.30 percent.

The 5-year adjustable-rate mortgage averaged 3.41 percent, down from last week’s 3.47 percent average. A year ago, it averaged 3.95 percent.

As rates continue to fall, the number of mortgage applications is increasing. Mortgage applications increased 8.2 percent this week compared to one week earlier, reports the Mortgage Bankers Association. The refinancing index increased 9 percent, the highest level since mid-March. Mortgage applications for purchase also got a boost, rising 7.1 percent compared to the previous week.

All indications point to a growing rate for home mortgages, so, if you are ever going to buy, now is the time.

Call us at 598-3200, or, 1-800-677-MOVE(6683)

VEGAS ….HERE WE COME AGAIN

This week we will be attending the Semi-Annual Conference of the relocation Industry. This meeting will feature speakers from some of the largest employers, corporations and relocation specialists in the nation and will be attended by around 2000 individuals and companies who serve the relocation industry.

It should be a unique view into what the ‘movers and shakers’ are predicting and we will provide you with some highlights next week.

Bye for now.

And, please remember, I would be honored to serve as your Broker for all of your residential real estate needs. I want to help you, my reader, make the most prudent and accurate Real Estate business decision.

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 39 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.

Just click on the icon at the top of this email to listen to my latest podcast. ….And, if you would like to learn more about our Job Loss Protection Program, please contact us.

LATEST STATISTICS
Click here for the latest Sales and Listing statistics for the Pikes Peak area

 

JOKE OF THE WEEK

A businessman walked into a New York City bank and asked for the loan officer. He said he needed a loan and wanted to borrow $5000 for two weeks. The man’s credit checked out, so the loan officer said he would O.K. the loan, but the bank would need some security for such a loan.

The business man then handed over the keys to a Rolls Royce that was parked on the street in front of the bank. Everything checked out and the loan officer accepted the car as collateral for the loan. An employee then drove the Rolls into the bank’s underground garage and parked it there.

Two weeks later the businessman returned, repaid the $5,000 and the interest which came to $15.41.

The loan officer said, “We do appreciate your business and this transaction has worked out very nicely, but we are a bit puzzled. While you were away we checked and found that you are a multimillionaire. What puzzles us is why you would bother to borrow $5,000?”

The business man replied: “Where else in New York City can I park my car for two weeks for fifteen bucks?”

May 9, 2011

HARRY’S WEEKLY UPDATE
A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTAIL real estate MARKET

 

SHOULD YOU BUY THAT NEW HOME OR INVESTMENT PROPERTY NOW? LET’S LOOK AT THE NUMBERS.

WHAT DO THE LATEST NUMBERS FROM PPAR TELL US ABOUT OUR LOCAL real estate MARKET?

Our local market is trending up, and looks promising. In fact, compared to most other parts of the country, our local real estate market is looking fabulous. Here are some examples from the recent PPAR report for April of 2011:

• Average sales price in April - $215,466 (+1.9% from March 2011)
• Median sales price in April - $284,950 (+2.8% from March 2011 and +1.4% from April 2010)
• Average sales price in the first quarter of 2011 - $ 216,714 (+1.1% from 2010)
• Number of Single-family home sales in April – 748 (down 5.6% from 2010, primarily because of the artificial boost to sales caused by federal tax credit that was available in the first part of 2010)
• Number of First Quarter sales in 2011 – 2433 (down 4.6% from 2010, again, because of the artificial boost to sales caused by federal tax credit that was available in the first part of 2010)

It’s interesting to note that April sales of homes in El Paso County under $200,000 represented 56% of total sales. Sales of all homes under $300,000 represented 81% of all sales.

To see the latest Sales and Listing statistics on our local market, CLICK HERE

WHAT DOES THE LATEST “QUE” TELL US ABOUT OUR LOCAL real estate MARKET?

FIRST, WHAT IS THE QUE ?

The Southern Colorado Economic Forum (SCEF), sponsored by the University of Colorado in Colorado Springs, is an organization dedicated to reporting on the economic condition of the Southern Colorado business community. SCEF issues a quarterly report which covers such activities as: Residential sales, Multi family market, Airport trends, Sales taxes, Vehicle sales and registrations, Employment trends, etc. and contains 16 different statistical types of flow charts containing the most recent data. The report, referred to as the “QUE” is issued by Fred Crowley, the chief economist for the SCEF. The most recent QUE contains data for the first quarter of 2011.

To summarize some of the data in the most recent QUE:

• Our local Business Conditions Index (BCI) is 22.2% higher than Feb. 2009
• Our Employment rate, new vehicle registrations earnings and foreclosures are all better than 12 months ago
• Our Residential single-family permit level is improving.
• Our Housing price trends suggest there is stability in the local market.
• The trend over the past 12 months suggests the average sale price for a home over the last 12 months is increasing in the region. This trend suggests the housing market is recovering
• Further increases in housing prices are anticipated
• Increases in real rents are expected in 2011
• President Obama’s goal to end military deployments is expected to boost the local economy in 2012.

However, keep in mind that, as with most other areas of the economy, the future of real estate will be strongly affected by interest rates and job growth.

To see a complete copy of the latest QUE for the first quarter of 2011, CLICK HERE

AND, IF YOU WOULD LIKE TO LEARN MORE ABOUT OUR LOCAL ECONOMY ….

You might want to attend the 15th Annual Southern Colorado Economic Forum, Oct 14, 2011. Salzman real estate Services is proud to be the only residential Real Estate company to be listed as a “Forum Partner” in this annual event which supports the University of Colorado at Colorado Springs. Click here to learn more.

HERE ARE SOME COMMENTS ABOUT OUR CURRENT MARKET FROM ONE EXPERT

The following comments are excerpted from “All this bearish news makes me bullish” by Brett Arends, a senior columnist for MarketWatch and a personal-finance columnist for the Wall Street Journal.

There are several reasons I think this is a good time to buy:

• First, prices in many areas are now cheap. They have corrected a long way since the bubble began to burst five years ago. There are deals aplenty.
• The second reason: There are tons of foreclosures and short sales on the market. And there are plenty more sitting in the wings. Banks are holding back big shadow inventories of homes. And that means you can get a great deal. They have to sell. You don’t have to buy. You hold all the cards. Remember, the name of the game isn’t “let’s make a deal.” It’s “take it or leave it.”
• Third, in many places rental yields are terrific. It’s cheaper to own than to rent. And rents are rising, because so many former owners are now renters.
• The fourth reason I’m bullish is that you can get a very cheap mortgage. Thirty-year conforming loans are going as low as 4.3%. Throw in the tax break on the interest, and you are talking cheap finance.
• The fifth reason is that, as painful as this collapse has been, real estate has historically proven to offer very good long-term protection against inflation. Returns have typically averaged about 1% or 2% above inflation. At a time when everyone has been piling into gold, commodities and TIPS bonds to protect themselves against the possibility of inflation, it seems odd that the most popular and successful hedge, namely real estate, goes a-begging.
• The sixth reason I’m bullish is perverse, but I’m sticking by it. Everyone else is bearish. You cannot find a real-estate bull anywhere. No one wants to own this asset. No one wants to talk about it. No one wants to hear about it. Everyone seems to agree it’s just going down, down, down — forever. They said much the same about stocks in 1987, 2002 and 2009; Treasury bonds in 1982; and gold in 2000. I cannot prove this is capitulation, but it sure smells something like it.
• There are good homes out there going really cheap. If you hunt down the bargains, you’re disciplined about price, you get the right financing, and you hold on for five years or more, you’ll probably do pretty well from here.

If it’s good enough for the personal finance columnist of the Wall Street Journal, it’s good enough for me. Where do I sign Up ???

 

JUST IN TIME FOR BUYING SEASON, RATES HIT YEARLY LOWS
Daily real estate News | May 6, 2011

The 30-year fixed-rate mortgage, a popular choice among buyers, sank even lower this past week, matching its yearly low of 4.71 percent from January, reports Freddie Mac in its weekly mortgage market survey. Last year at this time, the 30-year fixed-rate mortgage averaged 5 percent.

Meanwhile, the 15-year fixed-rate hit a new yearly low of 3.89 percent this week. Last week, the 15-year fixed-rate mortgage averaged 3.97 percent. The 15-year rate averaged 4.36 percent last year at this time. It reached its lowest level on record in November when it averaged 3.57 percent.

The one-year adjustable-rate mortgage averaged 3.14 percent, down from last week’s 3.15 percent. Last year at this time, it averaged 4.07 percent.

"Weaker economic data reports reduced Treasury bond yields and allowed mortgage rates to drift lower for the third consecutive week,” says Frank Nothaft, Freddie Mac’s chief economist.

Source: “30-Year Fixed-Rate Mortgage Matches Yearly Low of 4.71 Percent,” Freddie Mac (May 5, 2011)

 

BIG JUMP EXPECTED IN NEW U.S. HOUSEHOLDS
Daily real estate News May 4, 2011

Millions of young adults are beginning to move out of their parents’ homes and create new households at the fastest rate since 2007. Some housing experts are predicting these young adults may provide a major jump to U.S. housing starts--possibly by more than 50 percent, even by next year--and increase housing consumption at a rate nearly double that of the past two years, Bloomberg News reports.

In 2011, between 750,000 and 1 million new households are expected to be created, says UBS Securities LLC’s Maury Harris and IHS Global Insight’s Patrick Newport. In the year ended March 2010, new households stood at 357,000--the lowest on record, according to U.S. Census data. The “depressed rate” in new household formation has continued to jeopardize the housing market’s recovery, experts say.

But as the employment picture continues to improve, more young adults are leaving Mom and Dad’s house and making a new home for themselves. The “moving-back-in-with-Mom-and-Dad phenomenon” had caused a backlog of pent-up households, Charles Lieberman, chief investment officer with Advisors Capital Management LLC in Hasbrouck Heights, N.J., told Bloomberg News. “Improved economic conditions” will “enable these households to split up and resume living in their own residences.”

Housing starts are expected to get a boost to about 648,000 this year and near 900,000 in 2012 (it stood at 586,800 last year), says Brad Hunter, chief economist and national director of consulting for Metrostudy. The increase in housing starts, he says, reflects a “shadow demand” for new homes among family members who have moved in together because of economic conditions.

“The demographic component of housing demand is strong," he says. "It’s just the economic and psychological components that are holding things back.”

This increase in households is great news for Homebuilders, Sellers and Investors. A rising tide of Households raises all boats.

Call us at 598-3200, or, 1-800-677-MOVE(6683)

 

GALLUP SAYS IT’S TIME TO BUY
Rismedia, May 5, 2011

Consumer attitudes towards the housing markets are echoing views in the years immediately preceding the peak of the housing boom, according to a new national survey by the Gallup poll.

Americans continue to see a buyer’s market in housing, according to an April 2011 Gallup poll. Sixty-nine percent of respondents say now is a good time to buy a house.

Historic Gallup data shows that many Americans also thought it was a good time to buy between 2003 and 2005, when housing prices were increasing and getting financing was relatively easy. Those attitudes began to change in 2006 as some homebuyers began to realize a housing bubble was taking shape in local markets across the country.

Men (74 percent) are about 16 percent more likely to see now as a good time to buy a home than women (64 percent). Americans making $75,000 or more a year (86 percent) are 18 percent more likely to see 2011 as a good time to buy a home than those making $30,000 – $75,000 (73 percent), and 72 percent more likely than those making less than $30,000 (50 percent).

Americans’ expectations for home prices in their local markets are slightly better now than they were in January. Currently, 30 percent of Americans say home prices will increase and 28 percent say they will decrease in the next year.

 

HERE’S SOME STARTLING NEWS ….NEARLY HALF OF HOME BUYERS SURVEYED DON’T UNDERSTAND ESSENTIAL INFORMATION ABOUT MORTGAGES
RISMEDIA, May 5, 2011

As the housing market continues to struggle, home buyers appear ill-prepared to take out a mortgage, answering basic questions about mortgage information wrong nearly half (46 percent) of the time, according to a recent Marketplace survey. In fact, 44 percent admitted they are not confident in their knowledge of mortgages or the mortgage process. The Marketplace survey surveyed prospective home buyers, asking them to gauge their own knowledge of mortgages, and asking basic questions about mortgage facts.

More than half (57 percent) of prospective home buyers who were polled do not understand how adjustable rate mortgages (ARMs) work. When asked if interest rates on 5/1 ARMs always reset higher after five years, the majority of home buyers answered yes. In fact, the interest rate will adjust to the prevailing rate after five years, even if rates have declined. Currently, many borrowers whose ARMs have recently reset have lower interest rates than they did when they took out the loan.

Additionally, one-third (34 percent) of the respondents who are prospective home buyers do not understand that lender fees are negotiable and that they vary by lender. They believe lenders are required by law to charge the same fees for credit reports and appraisals, when in fact home buyers can save money by shopping for the lowest fees.

Additional Survey Findings

• More than half (55 percent) of prospective home buyers in the study do not understand that mortgage rates vary throughout the day. In reality, mortgage rates can change rapidly, similar to how stock prices can change throughout the day. To get the optimum rate, it is important to monitor rates and shop around.
• More than one-third (37 percent) of prospective home buyers who were polled believe that pre-qualifying for a loan means they have secured financing. In fact, “pre-qualification” is used to describe the earliest step in the process when a lender approximates how much you can afford, but does not run your credit or request any sort of documentation to verify the information you provide. Although there is not a reliable industry standard definition of pre-qualification, it is not until a lender has approved your loan application without conditions that you can rest assured that the lender has committed to financing your loan.
• More than two in five (42 percent) of the polled prospective home buyers do not understand that Federal Housing Administration (FHA) loans are available to ALL buyers. Instead, they believe only first-time buyers qualify. FHA loans can cost less for many buyers, including repeat buyers with low to average credit scores and with down payments of less than 20 percent.
Let us help you negotiate your way through the mortgage maze. Call us at (719) 598-3200, or, 1-800-677-MOVE(6683)

LANDLORDS SAY THEY'LL RENT TO THE FORECLOSED
Daily real estate News - May 4, 2011

Eighty-two percent of independent landlords say they would rent to someone who had lost a home in foreclosure, if the applicant had otherwise good credit, according to a new survey by The National Association of Independent Landlords.

"Landlords typically won't rent to applicants with poor credit--and a foreclosure will absolutely slam someone's scores,” says Tracey Benson, president of The National Association of Independent Landlords. “The exception is when they see people who have paid their bills their whole life, but lost their job, can't meet their mortgage and must hand their keys back to the bank.”

Benson says that applicants with a foreclosure aren’t necessarily bad credit risks. “Often, they lost their jobs and homes through no fault of their own," she says.

As such, "because of this abundance of defaults, there is a greater need for rental property, so landlords should carefully vet applicants," Benson says, adding that landlords should do a thorough background check to determine whether defaulting applicants were a victim to financial woes or following a lifelong trend of not paying bills.

Investors, take note !!!

Let us localize this situation to Colorado Springs residential real estate investments. Call us at 598-3200, or, 1-800-677-MOVE(6683)

And, please remember, I would be honored to serve as your Broker for all of your residential real estate needs. I want to help you, my reader, make the most prudent and accurate Real Estate business decision.

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 39 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.
Just click on the icon at the top of this email to listen to my latest podcast. ….And, if you would like to learn more about our Job Loss Protection Program, please contact us.

JOKE OF THE WEEK

The worried housewife sprang to the telephone when it rang and listened with relief to the kindly voice in her ear. "How are you, darling?" it said. "What kind of a day are you having?"

"Oh, mother," said the housewife, breaking into bitter tears, "I've had such a bad day. The baby won't eat and the washing machine broke down. I haven't had a chance to go shopping, and besides, I've just sprained my ankle and I have to hobble around. On top of that, the house is a mess and I'm supposed to have two couples to dinner tonight."

The mother was shocked and was at once all sympathy. "Oh, darling," she said, "sit down, relax, and close your eyes. I'll be over in half an hour. I'll do your shopping, clean up the house, and cook your dinner for you. I'll feed the baby and I'll call a repairman I know who'll be at your house to fix the washing machine promptly. Now stop crying. I'll do everything. In fact, I'll even call George at the office and tell him he ought to come home and help out for once."

"George?" said the housewife. "Who's George?" "Why, George! Your husband! Is this 223-1374? "No, this is 223-1375." "Oh, I'm sorry. I guess I have the wrong number."

There was a short pause and the housewife said, "Does this mean you're not coming over?"

May 2, 2011

HARRY'S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTAIL real estate MARKET 

 

MARCH'S LOCAL ECONOMIC INDICATORS SHOW SPRINGS RECOVERY IS ON TRACK

The Gazette (Sunday, May 1, 2011) reports that seven out of eight March indicators show Colorado Springs is on track for a recovery.

The good news is that, in March:

• Wage and Salary jobs were up .1%
• Initial claims for unemployment were down 7.3%
• The unemployment rate was down to 10.1%
• New Auto and Truck registrations were up 40.6% (Thank you, Fort Carson)
• Taxable retail sales were up .8%
• Hotel occupancy rate was up to 56.8%
• Foreclosure filings were down 42.1%

The only bad news was that single-family home permits were down 60.8%. Unfortunately, that segment of the market will continue to falter until the foreclosure and short-sales are absorbed.

 

SPRINGS ON TOP 10 LIST FOR EARLY HOUSING TURNAROUND

Colorado Springs is among 10 cities and metropolitan areas nationwide that are poised for an "early turnaround" in their housing markets, according to a study released this week.

Realtor.com, an arm of the National Association of Realtors, included Colorado Springs in its first-ever listing of cities and metropolitan areas where market conditions such as sales, prices and days-on-the-market were analyzed. Julie Reynolds, a Realtor.com vice-president said, "You're signaling signs that a turnaround may be in progress".

The survey collected data from 146 metro areas around the country which includes around 930 multiple listing services. Some 20 key measurements, including prices, inventories and new listings were examined for March, and compared with the previous month and with March of last year.

Among positive indicators for the Springs were:

• Median list price of homes for sale in the Springs was $224,900, compared to $199,500 nationwide
• March Inventory of homes in the Springs was 4.51% year-over-year increase over 2010. Nationally, the increase over 2010 was 9.75%
• Median number of days on the market in the Springs was 113, as opposed to the national figure of 160.

 

WILL YOUR NEW HOME COST MORE IN SIX MONTHS? .THE STOCK MARKET SAYS, "YES"

The Wall Street Journal (April 27, 2011) reported that the Dow Jones Industrial Average soared 115.49 points (.9%) last Tuesday to finish at 12,595.37, a fresh three-year high. If there is one absolutely predictable certainty, it is that the stock market leads the national economy by two quarters. That being the case, you can count on the value of your present home to rise during the next six months and, if you are looking to buy, the cost of your new home will also rise.

Better call us today at  598-3200 or 800-677-MOVE (6683).

 

FOR THE SECOND STRAIGHT WEEK, MORTGAGE RATES DROP

Daily real estate News, April 29, 2011 

For the second straight week, mortgage rates continued to inch downward, according to Freddie Mac's weekly Primary Mortgage Market Survey.

The 15-year fixed-rate mortgage averaged 3.97 percent, the lowest since Dec. 9, 2010. Last week, it averaged 4.02 percent, and a year ago at this time it averaged 4.39 percent.

Meanwhile, the 30-year fixed-rate mortgage, the most popular choice among buyers, averaged 4.78 percent this week, down from last week's 4.80 percent. Last year at this time, the 30-year fixed-rate mortgage stood at 5.06 percent.

The 5-year adjustable-rate mortgage averaged 3.51 percent this week, down from last week's 3.61 percent average. A year ago, it stood at 4 percent.

Source: "Mortgage Rates Fall With Latest Economic and Housing Reports," Freddie Mac (April 28, 2011) 

 

IT'S A BUYERS' MARKET ..OR IS IT?

Traditionally, when the term "Buyers' Market" was used, it meant that Buyers had their pick of the market, Sellers were so desperate they would reduce their asking prices and Lenders were lining up to get your business.

However, in today's Buyers' Market, it ain't that easy. Although prices are well below what they were four or five years ago, Buyers now face several new hurdles.

First of all, Sellers are at the bottom of their negotiating space and cannot offer any further reductions in their asking prices, unless they are willing to consider a 'short sale'.

Secondly, the available 'deals' are being pursued by more and more prospective Buyers, so the bidding wars are cutting many people out of the game.

Third, many Investors are making all-cash offers for the available homes which leaves the typical prospective Buyers out in the cold.

Finally, Lenders have tightened-up their lending requirements with higher down-payment requirements, tighter credit requirements and higher fees.

So, our present 'Buyers Market' doesn't look like the traditional model.

What does this mean to you? Well, it emphasizes that, even in our present Buyers Market, you will need the assistance of an experienced Realtor who has detailed knowledge of the various neighborhoods in the area, good working relationships with ethical, reliable Lenders and great negotiating skills.

Call us at 598-3200 or 800-677-MOVE (6683).  

 

LET'S TALK ABOUT MORTGAGES

How much do you know about mortgages?

A recent survey by Zillow Mortgage Marketplace found that borrowers who received a home loan in the past five years spent, on average, five hours researching their options. That's about half the amount of time borrowers spent researching a car purchase (10 hours). What's more, nearly one-third spent two hours or less.

While a home purchase is typically one of the largest investments people make, the lack of mortgage knowledge can be a costly mistake. Here are a few basics about home loans that you need to know about.

1. What type of mortgage do you have?
Alarmingly, some people aren't even aware if they have a fixed-rate mortgage or adjustable-rate mortgage. Unlike a fixed-rate mortgage, an ARM can have low rates early on that later rise significantly over time, which from a financial planning perspective can become a costly surprise if the borrower isn't even aware they have one.

2. Do you have mortgage insurance?
Home owners who purchased a home with conventional financing and a down payment of less than 20 percent may not even realize that they likely are paying private mortgage insurance, which costs about $25-$100 extra a month. Once home owners have sufficient equity in their home (20 percent), they no longer need to pay mortgage insurance and should contact their lender for some savings.

3. Do you understand all of your loan options
Many borrowers don't understand all of the loan options available to them - conventional loans, FHA, VA, USDA, etc. Experts recommend researching and comparing various mortgage rates and loan types to see what works best for their situation.

4. Is there a prepayment penalty?
Some loans have a prepayment penalty if a borrower pays off the loan earlier than intended. Typically, prepayment penalties are charged when borrowers sell or refinance their homes in the first few years of the mortgage. FHA, VA, and USDA loans do not have prepayment penalties. But it's important home owners with other mortgages become aware whether their loan has a prepayment penalty and understand the pros and cons of accepting such a penalty, experts note.

5.  How are the mortgage rules changing ?

That's a great question. The feds are still in the process of revising down payment requirements, fees, etc. That's making it tough for both Lenders and Buyers to keep up with the latest rules and regulations. And that's the reason you need to deal with a knowledgeable Realtor .one who constantly studies the latest regulations and who has close, working relationships with ethical, reliable local Lenders.

We can save you money when you are looking for the best financing arrangements available. Call us at 598-3200 or 800-677-MOVE (6683).

 

THINKING OF SELLING?  WE CAN HELP YOU SELL YOUR HOME NOW ....WITH THESE TIPS

In a buyers' market, selling your home can be a frustrating lesson, especially if you make costly mistakes that can slow your sales opportunities.

If you work with us to avoid common seller mistakes, you can save yourself time and money. Let's take a look at a few of these common mistakes. 

• Focusing exclusively on comparables. Yes, recent sales count. Studying and understanding the comps in your area will give you an idea about how much buyers were willing to pay for homes in your neighborhood in the recent months, but relying strictly on the comps is a mistake. We can help guide you in this area.

 

• Take a close look at the homes that are currently listed for sale. How does your home stack up? What are the benefits of buying your home compared to the others on the market? What makes your home stand out? Salzman real estate Services can help you tailor your home's advertising and promotion to be as effective as possible to prospective Buyers. We will emphasize such benefits as : good schools, neighborhood parks, walking distance to retail stores, close access to freeways, quiet neighborhood, bright rooms, open floor plans, new appliances, etc.  

 

• Make us aware of your improvements and upgrades. If you've put in a tankless water heater for instance, be sure to mention it. Make a bullet-style list, print it out, make copies, and leave it for open house guests. This additional sheet will help buyers remember specific details about your property and it will help your home stand out from the dozens of others that they might be viewing.

 

• Work with Salzman real estate Services to establish a reasonable listing price. You will have to consider such factors as : when you purchased your home, current market conditions, economic factors, length of ownership, improvements, and how much time you have to sell.

 

• Listing your home based on how much is still owed may result in an unreasonably high price. This can quickly result in a painful cycle of price reductions signaling to buyers that there's plenty of room to negotiate on price. 

 

• Not making curb appeal into web appeal is another mistake. Curb appeal is the art of making your home appeal to buyers from the moment they first see your home. Some sellers think of this in terms of making their home appealing when buyers come to an open house or drive by it. But these days, curb appeal must transfer to web appeal, too. We specialize in taking your home pictures in the most appealing presentation possible.

 Call us at 598-3200 or 800-677-MOVE (6683).

 

MAY 17, 2011 IS ELECTION DAY FOR OUR MAYOR ...ATTEND THE DEBATE TONIGHT !!

Hear the Bach & Skorman debate the issues facing our city on May 2nd at 6 p.m. at the Pikes Peak Center.

Get the facts. Be informed when you cast your vote.

The debate is moderated by Phil Lane with a special introduction of the new city council members.

Tickets are $10. Refreshments, hors d'oeuvres and cash bar available at the reception immediately following the debate.

The candidates and council members will be available during the reception. Also contributing to the evening - Poet Laureate, James Ciletti and music by the Colorado Springs Conservatory.

And, please remember, I would be honored to serve as your Broker for all of your residential real estate needs. I want to help you, my reader, make the most prudent and accurate Real Estate business decision.

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 39 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.

Just click on the icon at the top of this email to listen to my latest podcast. ..And, if you would like to learn more about our Job Loss Protection Program,  please contact us. 

 

LATEST STATISTICS

Click here for the latest Sales and Listing statistics for the Pikes Peak area

 

JOKE OF THE WEEK

April 25, 2011

HARRY'S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTAIL real estate MARKET

 

 

"NEIGHBORHOODS" OFFERS AN IN-DEPTH LOOK AT OUR real estate MARKET

On Sunday, April 24, 2011, the Gazette published its annual "Neighborhoods" guide to real estate in El Paso County. This invaluable resource gives neighborhood-by-neighborhood analysis within our county and shows where prices are rising and falling. It contains maps and data about where you live and charts on how your area is doing.

The guide contains a 10 year comparison of median sales prices in each of 80 neighborhoods in El Paso County, per the county Assessor's office. The numbers shown in the guide do not differ significantly from the data published by the Pikes Peak Association of Realtors in the MLS.

Some of the significant data for El Paso County shown in the guide are:

•  Approximate population                              622,263
• Houses in County                                       163,221
• Houses sold in 2010 (no foreclosures)              5,681
• Foreclosure sales, 2010                                  1,499
• Total houses sold  2000-2010                       121,861                             
• Median sales price 2000-2010                     $195,763
• Median sales price 2010 (no foreclosures)    $210,000
• Median sales price 2010 with foreclosures    $200,000
• Average age of houses in years                         18

 The guide data shows the increase in median sales price of homes between 2000 and 2010 to be 34%, or 3.4% per year, which is slightly less than the PPAR figure of 4.18% annual appreciation. Considering the fact that last years sales were down, that kind of growth is surprisingly good and compares very favorably with the national figures.

 In May, NAR will report on the first quarter sales for the nation and we are looking forward to seeing how our county compares with the rest of the nation. Indications are that we will look very good, compared to the rest of the U.S. We will share the NAR data with you as soon as we receive the report.

 To see all of the information in "Neighborhoods", click here.

 

 

WANT TO MAKE 100% PROFIT PER YEAR ON YOUR INVESTMENT? ..BUY A HOUSE !!

The Gazette Guide to real estate which we feature, below, makes a great case for buying a house in El Paso County RIGHT NOW !!!

Here's the facts:

 

• You can currently buy a home through FHA with 3.5% down (That's your investment)
• Homes in El Paso County have appreciated an average of 3.5% per year during the past ten years (Even including the recession)
• That means you will make back your investment (i.e. your down-payment) the first year you own your home
• After ten years, you will have made 1,000% on your original investment. .And that's not even counting the money you will make with your home-interest payment deductions and your property tax deductions)

Let's see the stock market try to match that kind of return !!!

Call us at (719) 598-3200 or 800-677-MOVE (6683).

 

AND SELLERS, TAKE NOTE. THERE'S A BRIGHT SIDE FOR YOU, TOO

The "Return on Investment" arguments that we discussed, above, can also make it easier for you to sell your house. We are experts at showing prospective Buyers how buying your home makes sense for them. We are also able to negotiate to make the entire transaction as simple, convenient and cost-effective as possible for both the Buyer and the Seller.   

Call us at (719) 598-3200 or 800-677-MOVE (6683).

 

HOUSING IS BOUNCING BACK

 Nationally, sales of existing homes rose 3.7% in March, with distressed sales making up 40 percent of all purchases. This marks the sixth consecutive monthly rise for existing home sales in the last eight months, the National Association of REALTORS reported Wednesday.

NAR's housing affordability index shows the typical monthly mortgage principal and interest payment for the purchase of a median-priced existing home is only 13 percent of gross household income, the lowest since records began in 1970.

"We're clearly on a recovery path," says Lawrence Yun, NAR chief economist. "Although home sales are coming back without a federal stimulus, sales could be notably stronger if mortgage lending would return to the normal, safe standards that were in place a decade ago - before the loose lending practices that created the unprecedented boom and bust cycle," Yun explained.

So , let's take a look at who's buying and currently driving the market:

First-Time Buyers: A NAR practitioner survey shows first-time buyers purchased 33 percent of homes in March, compared with 34 percent of homes in February. When the federal first-time buyer stimulus was being offered, first-time buyers accounted for 44 percent in March 2010.

Investors: Nationally, all-cash deals made up a record number of sales last month and accounted for 35 percent of all resold homes. Investors continue to make up a big part of those cash deals. Investors are buying distressed homes and flipping them for a slight profit or turning them into rentals.  

Traditional buyers: Traditional buyers are re-emerging. Mortgage applications to buy homes rose 10 percent over a seven-week period, according to the Mortgage Bankers Association's most recent report.

It's obvious that the market is making "slow, steady progress" and demand in housing is rising even with higher mortgage rates.  



HERE'S A BRAIN-TEASER QUIZ FOR YOU

Consider the following recent articles from the Gazette and decide which conclusion is the most logical.

 

• Area apartments filling up; rents going up (Friday, April 25, 2011)
• INVESTORS STILL BUYING UP HOUSES (Friday, April 21, 2011)
• HOME PRICES DROPPED IN 2010 (Sunday , April 24, 2011)
• PEOPLE ARE MOVING HERE FASTER THAN THE JOBS ARE (Monday, April 25, 2011)

Possible conclusions:

1.  Golly, with home prices so low, but climbing, and mortgage rates still very low, this is probably not the time to buy an investment property.
2. Hmm, with more people coming to live here every day, thus causing apartments to fill up and rents to rise, this is probably not the time to buy an investment property
3. Gee, with foreclosures still adding more families to the pool of prospective renters  ..families that are used to living in well-maintained homes, but are now not credit-worthy enough to qualify for home loans, this is probably not the time to buy an investment property.
4. Gosh, with rentals in short supply, with rents going up, with more families looking for places to rent, with both the cost to acquire investment property and mortgage rates still very low, I'd be crazy not to investigate buying some investment property.  

If you chose option #4, give us a call. We will be happy to assist you in cashing in on our present "Opportunity Market".

Call us at (719) 598-3200 or 800-677-MOVE (6683).

 

PROPOSED 20% MINIMUM DOWN RULE WOULD SEVERELY DISRUPT THE housing market

A plan unveiled by the Federal Deposit Insurance Corporation (FDIC) and the Federal Reserve on March 29 to require a minimum 20% down payment for "qualified residential mortgages" would disrupt the fragile housing market and jeopardize the struggling economic recovery, according to both the National Association of Home Builders and the National Association of Realtors.

In addition to NAHB and NAR, diverse industry and consumer groups and housing finance experts took strong exception to the proposal, pointing out that it could prevent millions of credit-worthy borrowers from buying homes and would be a major setback for the housing industry as it slowly emerges from its worst downturn since the Great Depression.

Lawrence Yun, NAR chief economist said, "Given that FHA and VA government-backed loan programs turned a modest profit over to the U.S. Treasury last year, and have never required a taxpayer bailout, we believe low-down payment loans should continue to be available for those consumers who have demonstrated financial responsibility and are willing to stay well within their budget. Raising the down payment requirement would unnecessarily deny credit to many worthy middle-class families and veterans."

By mandating a 20% down payment on qualified residential mortgages, the Administration and Federal regulators would essentially exclude those without huge cash reserves - which constitutes most first-time home buyers and many middle-class households - from a chance to buy a home. First-time home buyers historically average 40% of home-buying activity. It would take an average family 12 years to scrape together a 20% down payment.

Borrowers who can't afford to put 20% down on a home and who are unable to obtain FHA financing would be expected to pay a premium of two percentage points for a loan in the private market to offset the increased risk to lenders.

To meet the 20% down payment requirement and adding in another 5% in closing costs, the buyer of a $172,000 median-priced home would have to bring more than $43,000 to the table. (And even with a 10% down payment requirement, that buyer would need to bring $25,000 in cash to the closing.)

This would disqualify about five million potential home buyers, resulting in 250,000 fewer home sales and 50,000 fewer new homes being built per year, according to the National Association of Home Builders.

Six federal agencies are seeking comments on the risk retention proposal.

The proposed rule will become effective one year after the final rule is published in the Federal Register.

Editor's Note: We are very concerned about this proposed rule. This proposal, combined with the Dodd-Frank financial reform law passed last year, which requires lenders to retain 5% of the credit risk of each loan they grant, will further diminish mortgage credit availability and drive costs higher.

We should point out that millions of low down-payment loans have been originated safely for decades. Low-down-payments are not what drove this lending crisis. It was lax underwriting standards.

We are very concerned that when combined with other recommendations from the Administration's white paper on housing finance - including 10% down payment minimums for Fannie Mae and Freddie Mac mortgages and possibly higher down payments for FHA borrowers - this proposal will move the lending industry's goalposts unacceptably far from the reach of low-, moderate- and middle-income home buyers.

Basically, the government is telling Mr. and Mrs. America, "Thanks for paying your mortgage during these tough times, and thanks for building your wealth around housing, as we have encouraged you to do, but we are now changing the rules. We are going to reduce the value of your retirement nest egg even more than the recession already has. And as an extra thank you, your kids are going to find homeownership that much more difficult to obtain."

 

And, please remember, I would be honored to serve as your Broker for all of your residential real estate needs. I want to help you, my reader, make the most prudent and accurate Real Estate business decision.

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 39 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.

Just click on the icon at the top of this email to listen to my latest podcast. ..And, if you would like to learn more about our Job Loss Protection Program,  please contact us. 

 

LATEST STATISTICS

Click here for the latest Sales and Listing statistics for the Pikes Peak area 

April 18, 2011

HARRY'S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTIAL real estate MARKET

  

FORTUNE MAGAZINE SAYS, "IT'S TIME TO BUY AGAIN".

Fortune, April 11, 2011

 In their April, 2011 issue, Fortune Magazine's cover trumpets, "The Return of real estate" and their headline article declares, "Forget stocks. Don't bet on Gold. After four years of plunging home prices, the most attractive asset class in America is housing. It's time to buy again".

Fortune bases their recommendation upon the fact that, according to recent reports of inventories in 41 major housing markets, there are only 78,000 houses for sale or under construction in those markets. That's less than one fourth of the 343,000 units at the peak of the frenzy in 2006, and well below the level of a decade ago.

In normal times, those inventory levels would sell in 2 ½ months and we would have an incredible shortage. The article declares that's where we are heading.

Karl Case, one of the two economists who founded the famous S&P/Case-Shiller Home Price Index, states that, "People think I'm crazy to be optimistic, but housing is looking like the little engine that could".

Two basic factors are laying the groundwork for dramatic recovery in residential real estate:

• The historic drop in new construction
• The steep decline in prices

The new affordability will gradually lure Americans back to buying homes and the return of the homeowner will start raising prices in many markets this year.

As to affordability, analysts find that homeowners now pay just 9.8% of their income in after-tax mortgage, tax, and insurance payments. That's down from 17.2% at the bubble's peak in 2007 and by far the lowest number since 1999.

As to the cost of homeownership, in 28 out of 54 major markets, it's now cheaper to pay a mortgage and other major costs than to rent the same house.

For this scenario to play our, however, America will need a decent economy (translate: JOBS) and a  resulting rise in consumer confidence.

In non-distressed areas like Colorado Springs, where our foreclosure numbers are low, compared with most other areas of the country, it will not take as long for the market to work through our housing inventory. Since our inventory stands at about a seven month figure, a modest increase in demand will translate into strong gains in both prices and new construction. Again, the key will be JOB GROWTH.

Zandi of Moody's Analytics expects that prices will rise three to four points faster than inflation for the next few years in virtually all of the non-distressed markets like Colorado Springs. His view is that prices will increase in line with rents, which are now growing briskly because rentals are in short supply. These higher rents will encourage buyers to buy a home of their own.

The non-distressed markets will also lead the way in construction, Zandi says. He predicts a rise from our present 470,000 national starts in 2010 to as much as 700,000 starts this year.

What about the inventory of foreclosed properties? Well, keep in mind that many of them are now being purchased and converted into rentals, thus reducing our inventory. So, as the inventory of homes available for sale decreases, selling prices increase and new construction picks up.

All in all, it looks like real estate is poised for a dramatic comeback.  ..And, it's about time.

Call us to discuss your new home, or you new investment property at (719) 598-3200 or 800- 677 MOVE.

The train is starting to move. Don't get left at the station.

FREDDIE MAC MARKET OUTLOOK PREDICTS AN INCREASE IN HOME SALES

Freddie Mac forecasts a 5 percent increase in 2011 home sales over 2010, according to its U.S. Economic and housing market Outlook for April.

The report also contends that refinancing will likely account for a smaller share of loan applications later this year as wealthy borrowers decrease and mortgage rates increase.

"Expect to see a bit of spring in homes sales activity during the second quarter," said Frank Nothaft, VP and chief economist at McLean, Virginia-based Freddie Mac.

Nothaft continued, "Sales contract signings for existing homes were up in February, positioning the market for a bounce up going into the traditional home-buying season."

The expected pick-up in home sales is due to recent positive employment reports, the Market Outlook reveals. Unemployment declined for the fourth straight month to 8.8 percent, and net employment increased by 216,000 jobs. real estate employment was up by 10,000 jobs since last November.

The report also calculates that the share of adjustable-rate mortgage loans will be 7 percent in 2011 compared to the 5 percent 2010 average.

Freddie Mac compiles data on major economic and housing and mortgage market indicators and offers forecasts based on those indicators.

  

SPRINGS FORECLOSURE RATE 18% LOWER THAN A YEAR AGO

The Gazette

While many areas of the country saw their foreclosure situation worsen, the Colorado Springs area fared far better in the third quarter from both the previous quarter and from a year earlier, according to RealtyTrac's report.

According to the Gazette, the Springs had one foreclosure for every 129 households during the third quarter, which ranked it No. 64 among 206 communities. In the second quarter, Colorado Springs had one foreclosure for every 67 households, and ranked No. 53. At the end of 2009, the Springs had a rate of one foreclosure for every 39 households and was No. 50.

Although El Paso County Public Trustee Tom Mowle expects upward of 4,000 foreclosures this year, this would still be short of the record 5,470 filings established in 2009. Last month's total was the fewest number of filings since September 2008.

This is good news for our local real estate market and it is a good sign that our market is stabilizing.

 

PRICES ARE LOW! MORTGAGES CHEAP! BUT, CAN YOU GET ONE?

CNN Money

Yep, mortgage interest rates are low, but there's a catch: It doesn't matter how cheap rates are if you can't get a loan.

And these days, only highly qualified borrowers can get financing -- let alone the best rates.

Nearly a quarter of people who apply for loans are turned down, according to the Federal Reserve.

"Good borrowers with one or two blemishes on their credit are being denied credit," said Lawrence Yun, chief economist for the National Association of Realtors.

The denial rates tell only half the story. Many potential buyers aren't even applying for loans because they assume they can't get one.

Who's buying homes? The people with cash and/or good credit

That shows up in credit scores for loans financed with backing from Fannie Mae and Freddie Mac. The average credit score has risen to 760 from 720 a few years ago. For FHA loans, the average score has gone to 700 from 660. Loans made to borrowers with sub-620 scores are almost nonexistent.

Another factor keeping people out of the mortgage market is that lenders now require much more up-front cash. The median down payment for purchase is about 15%. During the housing boom, it approached zero. On most loans, banks want 20% down. On $200,000 purchases, that's $40,000, an insurmountable obstacle for many young house hunters.

Industry insiders say all these factors have reduced the pool of buyers, lowering demand for homes and hurting prices.

"We feel it really reduces the demand for houses," said Mike D'Alonzo, president of the National Association of Mortgage Brokers. "It's an unbelievable buyer's market, but there hasn't been as much activity as you would expect because not as many people qualify for loans."

If you have questions about your present ability to obtain financing, please give us a call to discuss it, at

(719) 598-3200 or 800- 677 MOVE (6683).

 

LEGISLATION INTRODUCED TO SPEED LENDER RESPONSE TO SHORT SALES  

Two lawmakers, one Republican and one Democrat, have joined forces to push federal legislation through that would facilitate wider use and shorter transaction timelines for a foreclosure alternative that some say could be a lifeline for millions of underwater homeowners while drastically reducing the number of empty, repossessed homes lining U.S. neighborhoods - the short sale.

The bill, introduced by Reps. Tom Rooney (R-Florida) and Robert Andrews (D-New Jersey), would impose a deadline of 45 days on lenders to give an approval, disapproval, or status of a decision on an offer for a short sale.

Rooney and Andrews say their legislation, the Prompt Decision for Qualification for Short Sale Act of 2011, will bring the processing time for short sale price approvals in line with the home-buying and home-selling consumer's expectations - at most 45 days after submitting the request for short sale approval.

A similar bill - in fact, by the same name - was introduced last September but never came up for debate before a House committee before the legislative session ended.

The National Association of Realtors (NAR) is throwing its support behind the new bill. Our trade group has been actively pushing the lending industry to improve the process for approving short sales, which represent about 13 percent of recent home sales according to NAR data.

The Prompt Decision for Qualification for Short Sale Act of 2011 has not yet been referred to a committee.

 

CITY'S SALES TAX TAKE IS UP ..AGAIN
The Gazette

Colorado Springs sales tax collections shoed a small gain from the same month a year ago, the city reported Tuesday.

Although the gain was only a .83% gain, it represented the 17^th consecutive month of year-over-year gain.

These tax revenues fund more than half of the city's annual budget for police and fire protection, roads and other services and they serve as a barometer of the vitality of the local economy, so the upward trend is a hopeful sign of recovery.

 

MORTGAGE RATES RISE; 30-YEAR FIXED IS AT 4.91%

Wall Street Journal, Friday, April 15, 2011

Mortgage rates rose slightly, with the average rate on 30-year fixed-rate mortgages climbing for a fourth straight week, according to Freddie Mac's weekly survey of mortgage rates.

The 30-year fixed-rate mortgage averaged 4.91% in the week ended Thursday, up slightly from the prior week's 4.87% but down from 5.07% a year earlier.

Mortgage rates generally track U.S. bond yields, which move inversely to Treasury prices. Rates have climbed this year after slumping most of last year when prices rallied on economic uncertainty.

Rates on 15-year fixed-rate mortgages averaged 4.13% in the latest week, up from 4.1% in the previous week but down from 4.4% a year earlier.

Five-year Treasury-indexed hybrid adjustable-rate mortgages were 3.78%, up from the prior week's 3.72% but down from 4.08% a year earlier. One-year Treasury-indexed ARMs were 3.25%, up from 3.22% but down from 4.13%, respectively.

Keep in mind that these 'official' rates are normally rounded up to the nearest eighth, at the Buyer' level.

To obtain the rates, the 15-year fixed-rate mortgages required payment of an average 0.7 point and the others required an average 0.6 point. A point is 1% of the mortgage amount, charged as prepaid interest.

Even with these increases, these are still great rates for Buyers, but the trend is going up, so call us today to discuss your new home, at (719) 598-3200 or 800- 677 MOVE (6683).

  

LET US TAKE YOU OUT TO THE BALL GAME 

Salzman real estate Services would like to invite you to be our guest at a Sky Sox game. We have four season tickets to all Sky Sox home games and, if you give us a call and if nobody else has already requested the tickets, we would be happy to let you have them.

These are great seats, in the first row, right behind the Sky Sox dugout.

However, you'll have to buy your own peanuts and Crackerjacks. Sorry !!

And, please remember, I would be honored to serve as your Broker for all of your residential real estate needs. I want to help you, my reader, make the most prudent and accurate Real Estate business decision.

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 39 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.

Just click on the icon at the top of this email to listen to my latest podcast. ..And, if you would like to learn more about our Job Loss Protection Program, please contact us. 

 

LATEST STATISTICS

Click here for the latest Sales and Listing statistics for the Pikes Peak area

 

JOKE OF THE WEEK

John was driving when a policeman pulled him over. He rolled down his window and said to the officer, "Is there a problem, Officer?"

"No problem at all. I just observed your safe driving and am pleased to award you a $5,000 Safe Driver Award. Congratulations. What do you think you're going to do with the money?"

John thought for a minute and said, "Well, I guess I'll go get that drivers' license."

Judi, sitting in the passenger seat said to the policeman, "Oh, don't pay attention to him -- he's just a wise guy when he's drunk and stoned."

Brian from the back seat said, "I told you guys we wouldn't get far in a stolen car!"

At that moment, there was a knock from the trunk and a muffled voice said, "Are we over the border yet?" 

The policeman decided to postpone the award until John is released from prison.

April 11, 2011

HARRY'S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTAIL real estate MARKET

 

HOW DOES THE FUTURE LOOK FOR COLORADO SPRINGS ??

Our city is positioned well for future growth. To cite some of the recent good news from the Gazette:

• Wage and Salary jobs are up 0.2%
• Initial claims for unemployment are down 11%
• New auto and truck registrations are up 14%
• Taxable retail sales are up 4%
• Hotel occupancy rate is up to 50.3%
• Foreclosure filings are down 23.4%

As further evidence of our nationally-recognized quality-of-life reputation, Colorado Springs was just named by Forbes Retirement Magazine as one of the top places in the U.S. to retire.

The bad news is:

• The unemployment rate is up to 10.5
• Single-family home permits are down 60.8%.

The obvious bottom-line is that we need to create more jobs to address our short-term and long-term challenges.

Historically, our city has done a good job of attracting such groups as non-profit organizations (i.e. small staff organizations) and retirees. Furthermore, we have been very fortunate in attracting military installations like the Air Force Academy, Fort Carson, Peterson Field, etc. These bases have provided much-needed economic activity and stability for our city. The happy result of their presence has been that we have not suffered the effects of the recession as badly as most other parts of the country.

Our weakness, however, is that we have failed to attract large corporations to our city. It is increasingly obvious that we must get more aggressive in attracting large corporations into our area. In fact, in recent years we have actually lost businesses to other parts of the country. Large, clean, corporations like Intel (which left Colorado Springs) hire large numbers of highly-paid, high-tech employees and greatly enhance the economy of their host cities. We need companies like that to move to Colorado Springs.

As evidence of how obvious our need for job-creation is, in the recent local elections, 5 of the 9 new members of the city council have already listed "job-creation" as their top goal.

So, since we all agree that 'job-creation' is our most pressing need, we think it's time we created a  dynamic partnership between our city government and the private sector to persuade businesses to relocate here. ..the kind of partnership that has worked so well in attracting new industries to relocate in other cities.

If the new city council is serious about going after new businesses, they should tap into our pool of successful, private sector entrepreneurs for assistance and advice about attracting new businesses to Colorado Springs. These successful entrepreneurs are business people who know what it would take to persuade other businesses to come here. They know what benefits and incentives could be offered to demonstrate to corporate leaders that, by moving to Colorado Springs, they could improve their productivity, their effectiveness and their bottom line.

These volunteer leaders would gladly serve as "sales representatives" for our city.  They could assist the city council in "pitching" Colorado Springs to the many companies that are now searching for places that are more 'business-friendly' than their present locations.

We know, from personal experience, that such input and assistance is effective in persuading businesses to move here. For example, in relocation, our specialty, there are many business incentives available that could easily persuade an out-of-state CEO that Colorado Springs could help him make his company more profitable. Tax-breaks, real estate discounts, relocation bonuses, etc. are valuable tools in the campaign to attract businesses and, we would be very happy to work with the city council as an asset in their efforts to attract new businesses.

We are all convinced we need these new businesses.  Now, all we have to do is show them that they need us.  

 

RULEMAKING COULD CRIMP THE AMERICAN DREAM:  HOMEOWNERSHIP IS ON THE LINE

RISMEDIA, April 5, 2011-Recently, the Federal Deposit Insurance Corporation adopted for public comment a proposed rule concerning risk retention on mortgage-backed securities, as required by section 941 of the Dodd Frank Act. The rule could have profound consequences for this country's housing finance system. Most at risk, perhaps, are prospective first-time HomeBuyers who have little hope of saving a 20% down payment plus closing costs.

The primary purpose of the Dodd-Frank risk-retention provision is to ensure that lenders retain a sufficient amount of risk (5%) to align their interests with those of the investors. The statute does allow exemptions to risk retention for securities backed entirely by loans meeting certain standards, as defined by the regulators. For residential mortgages, such exempted loans will be known as "qualified residential mortgages," or QRMs. However, the regulators have designed the QRM to be "conservative," in the belief that the exemption should cover only a small part of the market, leaving a "liquid, active market" for securitization of nonexempt loans.

The proposal explicitly recognizes that the proposed QRM definition is likely to exclude many prudently underwritten loans to credit worthy borrowers. The most severe limitation would make eligible only loans for which a borrower provides a 20% down payment (plus closing costs) in cash.

Other requirements that are likely to disqualify many borrowers include:

• The maximum loan-to-value ratio of 80% for the purchase of mortgages by the issuers of mortgage-backed securities must be calculated without considering private mortgage insurance.
• The borrower may not have been 60 days past due on any debt within the last 24 months, and
• Tighter debt-to-income ratios than were standard long before the recent housing crisis.

As presently written, the proposal would preclude most first-time home buyers from a QRM loan.

Under the proposal, as long as Fannie and Freddie are in conservatorship, their guarantee will be deemed to have met the risk-retention requirement. But what will be the impact of any reduction in the activities of Fannie Mae and Freddie Mac (as both the Obama administration and House Republicans are now proposing)? Will there be successors to Fannie and Freddie, and how will their securitizations be treated? And what will be the impact on the Federal Housing Administration, taxpayers, and communities if in the end all low-down-payment mortgages are insured 100% by the government through FHA?

If some of the radical privatization schemes under consideration now are implemented, we will be looking at a dramatically different housing market. Homeownership could become only a dream for many of America's middle-class families. The irony of this situation is that, if the widespread concerns about bad lending and securitization had been heeded years ago, today's families would not have to depend upon a highly complex rulemaking process and an uncertain legislative future.

The rule, which contains 174 multipart questions for comment, is now up for public comment. If you would like to get more details about this proposed rule, or, if you would like to voice your concerns about it, please contact us. It is important that we're heard this time-we've got 60 days.

Give us a call at  (719) 598-3200, or, 800-677-MOVE (6683).

 

HERE'S A "FORESOME" OF RECENT UNSETTLING NEWS ITEMS:

ONE IN FOUR MORTGAGE APPLICATIONS ARE NOW BEING REJECTED

Daily real estate News, April 6, 2011

According to the latest data from the Federal reserve, nearly a quarter of people who apply for a mortgage are rejected.

"Good Borrowers with one or two blemishes on their credit, are being denied credit", says Lawrence Yun, the chief economist for the National Association of Realtord.

Lenders are now requiring higher credit scores and down payments that have kept Buyers out, experts say. For example, the median down payment to buy a home nowadays is about 15% (which will rise to 20%, if the proposed rule, described above, is adopted). During the housing boom, down payments were nearly zero.

"Tighter lending requirements and higher down payment requirements have really reduced the demand for houses", says Mike D'Alonzo, president of the National Association of Mortgage Brokers. 'It's an unbelievable Buyers' market but there hasn't been as much activity as you would expect because not as many people qualify for loans.

Indeed, Anthony Sanders, director of real estate Entrepreneurship at George Mason University, estimates that the tighter credit standards has caused as many as 30% of would-be-buyers, or even more - to sit on the sidelines.

MORTGAGE RATES EDGE UP FOR THE THIRD MONTH IN A ROW;  30-YEAR FIXED IS AT 4.87%

The Wall Street Journal  April 8, 2011

Mortgage rates mostly edged higher in the latest week, for the third consecutive week, with the average on 30-year fixed-rate mortgages rising slightly to 4.87%, according to Freddie Mac's weekly survey.

Mortgage rates generally track U.S. bond yields, which move inversely to Treasury prices. Rates have climbed this year after slumping most of last year when prices rallies on economic uncertainty.

Freddie Chief Economist Frank Nothaft noted that rates were little changed after what he called "an encouraging employment report" from the Bureau of Labor Statistics.

The 30-year fixed-rate mortgage averaged 4.87% in the week ended Thursday, up from 4.86% the prior week but down from 5.21% a year earlier. Rates on 15-year fixed-rate mortgages were 4.1%, up from 4.09% the previous week but down from 4.52% a year earlier.

Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 3.72%, up from the prior week's 3.7% but down from 4.25% a year earlier. One-year Treasury-indexed ARMs were 3.22%, down from 3.26% and 4.14%, respectively.

To obtain the rates, the five-year ARMs required payment of an average 0.6 point and the others required an average 0.7 point. (A point is 1% of the mortgage amount, charged as prepaid interest.)

BORROWERS RUSH TO SECURE GOVERNMENT-BACKED LOANS

Daily real estate News - April 6, 2011

Purchase applications for mortgages increased 6.7% last week, reaching its highest level of the year, according to the Mortgage Bankers Association.

The MBA reports that government loan applications reached their highest level since May, 2010, increasing 10.3% last week, compared to the week prior.

The MBA attributes the surge to borrowers who were likely motivated to apply for government loans before a scheduled increase in FHA insurance premiums.

ALL OF WHICH PROVES THAT MY GRANDPA WAS RIGHT WHEN HE SAID, "IN A RECESSION, CASH IS KING"

As a result of the credit squeeze, NAR reports that, in February, 33% of existing-home sales were made to cash Buyers. That number is projected to grow to 40% by the end of 2011. But it's not just Investors who are buying these homes. Many of these sales are to international Buyers, according to NAR.

 

SO, WHAT'S THE BOTTOM LINE FOR BUYERS, SELLERS AND INVESTORS?

The bottom line for our readers is that now, more than ever before, is the time to invest in real estate. Prices are low, interest rates are still a bargain, inventory is high and the pool of available renters is growing every day. Every mortgage application that is turned down represents a prospective renter for your investment property. Furthermore, these new regulations will soon make it even more difficult to buy.

The caution is, however, that our market is changing every day and you will need the assistance of a Realtor who understands our local money market, our local lenders and our local neighborhoods. With over 39 years of experience and a strong background in finance, we can help guide you through the confusing maze of regulations that is now turning off so many prospective Investors.

Give us a call at (719) 598-3200, or, 800-677-MOVE (6683).

And, please remember, I would be honored to serve as your Broker for all of your residential real estate needs. I want to help you, my reader, make the most prudent and accurate Real Estate business decision.

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 37 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.

Just click on the icon at the top of this email to listen to my latest podcast. ..And, if you would like to learn more about our Job Loss Protection Program, or, about our CyberHomes Complete Market Analysis of a property, please contact us. 

 

LATEST STATISTICS

Click here for the latest Sales and Listing statistics for the Pikes Peak area

JOKE OF THE WEEK

Because football season is about to begin and Sportsbars around the country are getting ready for the big football weekends, we thought it might be helpful to address some of the more common beerdrinking problems:

BEER TROUBLESHOOTING

SYMPTOM: Feet cold and wet.
FAULT: Glass being held at incorrect angle.
ACTION: Rotate glass so that open end points toward
ceiling.

SYMPTOM: Feet warm and wet.
FAULT: Improper bladder control.
ACTION: Stand next to nearest dog, complain about house
training.

SYMPTOM: Beer unusually pale and tasteless.
FAULT: Glass empty.
ACTION: Get someone to buy you another beer.

SYMPTOM: Opposite wall covered with fluorescent lights.
FAULT: You have fallen over backward.
ACTION: Have yourself leashed to bar.

SYMPTOM: Mouth contains cigarette butts.
FAULT: You have fallen forward.
ACTION: See above.

SYMPTOM: Beer tasteless, front of your shirt is wet.
FAULT: Mouth not open, or glass applied to wrong part of
face.
ACTION: Retire to restroom, practice in mirror.

SYMPTOM: Floor blurred.
FAULT: You are looking through bottom of empty glass.
ACTION: Get someone to buy you another beer.

SYMPTOM: Floor moving.
FAULT: You are being carried out.
ACTION: Find out if you are being taken to another bar.

SYMPTOM: Room seems unusually dark.
FAULT: Bar has closed.
ACTION: Confirm home address with bartender.

SYMPTOM: Beer is crystal-clear.
FAULT: It's water. Somebody is trying to sober you up.
ACTION: Punch him.

SYMPTOM: Hands hurt, nose hurts, mind unusually clear.
FAULT: You have been in a fight.
ACTION: Apologize to everyone you see, just in case it was
them.

SYMPTOM: Don't recognize anyone, don't recognize the room
you're in.
FAULT: You've wandered into the wrong party.
ACTION: See if they have free beer.

SYMPTOM: Your singing sounds distorted.
FAULT: The beer is too weak.
ACTION: Have more beer until your voice improves.

SYMPTOM: Don't remember the words to the song.
FAULT: Beer is just right.
ACTION: Play air guitar.

April 4, 2011

HARRY'S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTAIL real estate MARKET

 

NATIONAL housing market SHIVERS .BUT COLORADO CONTINUES TO LOOK GOOD

According to the Wall Street Journal, the Case-Shiller home-price index reports that housing prices across the U.S. continued falling in January, fueling concerns about a "double-dip" recession. However, Colorado Springs home prices are actually rising. Furthermore, our local foreclosure filings and sales are dropping, indicating that our local housing market has stabilized.

In March, our local foreclosure filings amounted to only 272. This represents the lowest figure since September, 2008, and a 42.1% drop from March of last year, when 471 filings were registered. The first quarter of 2011 saw 971 filings, down nearly 20% from 2010.

Local housing-sales figures are also looking good. According to the latest PPAR statistics, March saw 776 sales of single-family homes, which is a big jump from sales in January and February, which registered only about 400 sales in each month. There were additional sales of 80 condos/townhouses.

All of this data gives us good reason to be encouraged by the progress our local real estate market is showing.

For your information, the breakdown of sales by price shows

•  Up to $199,999              412 sales
• $200,000 - $299,999       183 sales
• $300,000 - $399,000       70 sales
• $400,000 plus                49 sales

These numbers show that sales of homes under $300,000 accounted for 83.3% of total sales.

To review all of the Sales and Listing statistics for March, CLICK HERE.

 

AND IT'S NOT JUST THE real estate NUMBERS THAT ARE LOOKING GOOD !!

The Gazette reports that several new businesses will be relocating to Colorado Springs. Olson Motor & Control, Inc. will locate a manufacturing facility in Colorado Springs.

Additional companies and organizations that have announced plans to relocate or expand since January 1 include Space Foundation, Outreach, Inc., Xiotech Corporation, Cosmic Advanced Engineering Solutions, Howell Precision Machine & Engineering, Inc.

Looks like the EDC is doing a good job of selling Colorado Springs.

And, more good news for our community, Fort Carson will be getting a new combat aviation brigade. The new 113-helicopter unit will be the Army's 13th combat aviation brigade and will push the post's population of soldiers to nearly 30,000.

According to post officials, $750 million will be spent to house the new helicopter brigade with construction cash starting to flow as soon as this fall. This influx of new Colorado Springs residents will definitely help reduce our inventory of available homes.

If that's not enough, Colorado Springs and the state continue to rank well in important categories: 

• Colorado was ranked 3rd Smartest State by CNNMoney.com.
• Colorado Springs ranked 8th in Housing Markets for Best Recovery Bet by CNNMoney.com.

OK, that's the good news. The following article describes what most people would see as 'bad' news

 

REGULATORS UNVEIL NEW MORTGAGE-LENDING RULES

Federal regulators have proposed far-reaching changes to lending rules that eventually will raise the cost of borrowing for most homeowners, kicking off what is likely to be a furious effort by the housing and banking industries to soften the proposal.

Tighter Standards are on the horizon

Mortgages that aren't subject to costly 'risk-retention' rules must meet certain requirements:

• 20% down payment for new mortgages; a 75% loan-to-value ratio for refinances, and a 70% ratio for 'cash-out' refinances
• Borrower hasn't missed two consecutive payments on any consumer debt within two years
• Mortgage-related debt is no more than 28% of income, and total debt doesn't exceed 36% of income
• Fully amortizing loans

Source: FDIC

"With the way this proposal is drafted, very few loans are going to qualify" says Lewis Ranieri, the pioneer of the home-mortgage-bond market.

Furthermore, the Dodd-Frank financial-overhaul law requires banks to hold 5% of the credit risk for mortgages and other loans that are bundled together and sold off as securities. The idea is that banks and other issuers of securitized loans will do a better job ensuring the quality of those loans if they are required to have more "skin in the game."

The real-estate industry and consumer-advocate groups already have forged an unlikely alliance to push for less-restrictive rules. They say the rules could substantially raise borrowing costs, particularly for first-time home buyers. "You're clearly creating a nation of have and have-nots when it comes to housing," said Jerry Howard, president of the National Association of Home Builders.

Critics of the rule say relatively few borrowers will be able to obtain the less costly, gold-standard mortgages. Around 46% of all homeowners with a mortgage had less than 20% equity in their homes at the end of 2010, according to CoreLogic Inc., a real-estate data firm.

"A rigid 20% down payment requirement is going to unnecessarily prevent the middle-class, first-time home buyers from getting affordable mortgages," Sen. Kay Hagan (D., N.C.) said in an interview.

 

SO, WHAT DO ALL OF THESE CHANGES MEAN TO YOU ???

Well, if you are a Buyer or a Seller, these new rules will make it more difficult for you to buy or sell your home. Taken collectively, they make it harder for Buyers to obtain financing and for Lenders to stay in business. In fact, one of our preferred Lenders has already advised us that, because of the profit-squeeze that these new rules establish, they will be going out of business at the end of the month.

Understandably, most Buyers and Sellers do not appreciate the intricacies of arranging for a "good" mortgage. However, the foreclosure crisis that has faced us in the last several years is a dramatic example of what happens when "bad" mortgages are allowed to enter the market. Many of these foreclosures are the result of overbuying, poor negotiation, excessive fees, and poor choice of lenders.

That is why it is more important than ever that Buyers and Sellers be guided by experienced, ethical Realtors, as they negotiate the maze of governmental regulations and market variables that are a part of the selling process.

When we work with our clients, we make sure that:

• the Client ends up with the best possible price for the home (through knowledgeable negotiation)
• the  Buyer can actually afford his/her choice of home
• the best mortgage interest rate is obtained for the client
• the Lender does not load the deal with excessive fees (This alone can save the Buyer between $2000 - $4000)

We feel confident that we can provide these services because of our 39 years of experience in the local market, our intimate knowledge of every financial aspect of the process and our close, working relationships with the most ethical local lenders and suppliers.

As a matter of fact, as we look back at all of the clients we have served over the years, we are not aware of even one of our clients that has gone into foreclosure. That's probably the best measure of a Realtor's professionalism.

Call us to discuss these issues at 800 677-MOVE (6683) or 719 598-3200  

 

WHY NEW HOMES AREN'T SELLING 

Once a common home buyer's dream, new homes have lost some of their appeal. Instead, it's fixer-uppers and foreclosures that have been capturing buyers' attention, creating a window of opportunity for those still looking for new construction.

While the real estate market has struggled across the board, new homes have been hit harder than ever before. Existing home sales are down about 3% in the last year, according to the latest data from the National Association of Realtors. That's peanuts compared to new home sales, which have fallen a whopping 28%, according to the U.S. Census.

To some extent, existing homes have always recovered before new construction, but analysts say this situation is so extreme that it could delay a meaningful recovery for the new-home market by two more years. "It's not looking promising for new housing," says John Vogel, adjunct professor of real estate at Dartmouth's Tuck School of Business.

The reason for the discrepancy is clear, experts say: New homes are currently 29% more expensive than existing homes, about double the typical margin, according to the NAR. At the same time, there are some radical discounts in the existing home market, foreclosures and short sales specifically, which accounted for nearly 40% of all sales in February. (In 2010, they accounted for 25% of all sales, according to RealtyTrac.com.)

But a shift in consumer psychology has also hurt new home sales. Pre-recession, buyers expected high-end appliances and fancy countertops, and builders delivered. Now consumers are more enthusiastic about a home that's easier and cheaper to maintain, says Vogel.

For many buyers, that even includes smaller rooms - a rarity in homes built during the real estate boom - that are more affordable to heat or cool. More buyers are also looking to live in or near a city - where relatively fewer new homes exist - to be closer to their job and to spend less on gasoline costs.

The trend doesn't seem to be reversing itself any time soon. In spite of the lagging sales, new home prices are still expected to rise by nearly 1% this year, according to the NAR: Builders have all but stopped building, says David Crowe, chief economist at the National Association of Home Builders, and supply is dwindling.

Nationally, there are around 186,000 new homes on the market right now, the lowest since 1967. And even builders who want to build may not be able to get financing. Just 20% of builders are shopping for loans, down from 80% pre recession, Crowe says.

But there are also bright spots for buyers: Eager to sell, some builders are unloading homes for less than the cost of building the house. Though limited in number, that's mostly happening in the hardest hit states of Arizona, California, Florida and Nevada, says Crowe, and often because the builder's loan for that property has come due. Buyers in these markets could end up with a new home for a price close to that of the fixer-upper down the street.

And, please remember, I would be honored to serve as your Broker for all of your residential real estate needs. I want to help you, my reader, make the most prudent and accurate Real Estate business decision.

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 37 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.

Just click on the icon at the top of this email to listen to my latest podcast. ..And, if you would like to learn more about our Job Loss Protection Program, please contact us. 

 

JOKE OF THE WEEK

A winter statistic:
 
98% OF AMERICANS SCREAM BEFORE GOING IN THE DITCH ON A SLIPPERY ROAD.

THE OTHER 2% ARE FROM COLORADO AND THEY SAY, "HOLD MY BEER AND WATCH THIS." 
  
Now, you're from Colorado if.........
 
You'll eat ice cream in the winter.

It snows a foot and you don't expect school to be cancelled.

You'll wear flip flops every day of the year, regardless of temperature.

You have no accent at all, but can hear other people's. And then you make fun of them.

"Humid" is over 10%.

Your sense of direction is: Toward the mountains and Away from the mountains.

You say "the interstate" and everybody knows which one.

You think that May is a totally normal month for a blizzard.

You buy your flowers to set out on Mother's day, but try and hold off planting them until just before  Father's day.

You grew up planning your Halloween costumes around your coat.

You know what the Continental Divide is.

You don't think Coors beer is that big a deal.

You went to Casa Bonita as a kid, AND as an adult.

You've gone off-roading in a vehicle that was never intended for such activities.

You always know the elevation of where you are.

You wake up to a beautiful, 70 degree day and you wonder if it's gonna snow tomorrow.

You don't care that some company renamed it, the Broncos still play at Mile High Stadium!!

Everybody wears jeans to church.

You actually know that **South Park** is a real place not just a show on TV.

You know what a 'trust fund hippy' is, and you know its natural habitat is Boulder.

You know you're talking to a fellow Coloradoan when they call it "Elitches," not ""Six Flags."

A bear on your front porch doesn't bother you.

Your two favorite football teams are the Broncos and whoever is beating the crap out of the Raiders.

When people back East tell you they have mountains in their state too, you just laugh.

You go anywhere else on the planet and the air feels "sticky" and you notice the sky is no longer blue.

Date:  Mar 28, 2011

HARRY'S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTIAL real estate MARKET

 HAPPY ANNIVERSARY TO ME !!!

On a personal note, this week marks my 39^th anniversary of selling homes in Colorado Springs. I mention this to clarify the rumor that I sold General Palmer his first home here 39 years ago, in 1972, I sold a house in Security for $13,450. Since then our local real estate market has seen many ups and downs, such as:

• The 1973 decision by the City Council to discontinue all gas taps. That unfortunate decision killed the city's progress dead in its tracks and it took a long time for the city to recover. It was a dramatic demonstration of the kinds of problems that can be caused by electing officials with no appreciation for jobs, capitalism and what "free-market' means.
• The creation of the Economic Development Council in the late 70's and the real growth that it generated.
• The good news in the late 70s-early 80s was the appreciation of home values of over 12%. The bad news was the growth of the interest rate to 18%. (Thank you, Jimmy Carter).
• The Savings and Loan financing mess which drove the government to shut down the S&L industry and caused a flood of foreclosures, similar to what is happening today in real estate. The result was a dismal, local Real Estate market in 1988-90.
• The local high-tech boom which brought in good, high-paying jobs and a wonderful real estate market, beginning around 1992-2005, when we reached our highest sales peak, with 13,124 local sales in a single year.
• Along the way, PPAR introduced the Multiple-Listing Service which provides us with invaluable statistics for assisting our clients in their decision-making process. Based upon those statistics, we see that the value of local homes between 1985 and February, 2011 went from $84,414 to $235,684, for an average appreciation of 5.8% per year.  No matter how you slice it, that's a great investment.

We have enjoyed working with our friends and clients during these 39 years and we have also enjoyed helping the companies, both local and national, that have used our relocation services.

As we begin our next 39 years. we look forward to assisting you as you sell, buy or invest in real estate. We look forward to negotiating on your behalf as you build your financial future and invest in our great community.

And yes, General Palmer was a great guy to do business with.

Call us at 598-3200, or, toll free at 800 677-MOVE 

SPRINGS NAMED "ONE OF THE BEST RETIREMENT PLACES" BY FORBES THE GAZETTE March 25, 2011 2:59 PM

Forbes magazine names Colorado Springs one of its best places to retire in its April 11 issue. The magazine cited our affordable housing, safe streets and low cost of living as plusses to retiring here, but said the winter might be a drawback and said the area was "a bit light on doctors." The Springs shared the honor with 15 other cities, including Albuquerque, N.M., and Salt Lake City, Utah. Forbes said taxes and cost of living heavily influenced the list, although factors such as health care, climate and crime also played a role.

 

SOME THINGS TO LOOK FORWARD TO THIS YEAR IN COLORADO SPRINGS

To those in our community in search of the often hard-to-find "good news," a coalition of community organizations have committed to pull together some positive, relevant and, in some cases, inspiring news about things that are happening in our community on a quarterly basis.  This "News Worth Sharing" publication is provided to those in our community who want more information about all the great things going on and getting done right here in the Pikes Peak Region from a business or civic perspective.  

Some of the things we can look forward to and take pride in during 2011 are:

1. Police and Fire recruiting academies
2. Saturday bus services and additional paratransit services restored
3. Residential streetlights turned back on
4. Trash cans and park maintenance services returned to neighborhood parks and medians maintained
5. Maintaining Park, Recreation and Cultural Services including the Therapeutic Recreation program, Center, Deerfield, Meadows Community Center, North Cheyenne Cañon Visitor Centers, Rock Ledge Ranch, and operating the Julie Penrose and Uncle Wilbur fountains next summer
6. The Space Foundation's move to new headquarters & three new primary employers for the region. This also means that the annual National Space Symposium remains here, taking place this year from April 11 - 14 at The Broadmoor.
7. The International University Sports Federation (FISU) chooses Colorado Springs as the host city for its 2012 World University Championships in Softball (August 2-11) and Boxing (August 2-10), with both sports held at UCCS. The events are part of a schedule of 33 winter and summer World University Championships to be conducted in 2012, the largest number in FISU history.
8. UCCS will be the first university to deliver for-credit college courses via Telepresence. UCCS and computer giant Cisco held a worldwide press conference on January 19, 2011 to share this new way of delivering education.
9. Colorado Springs' cost of living, utility bills lower than national average. Living in Colorado Springs costs 7.2 percent less than the national average, according to the 2010 ACCRA Cost of Living Index. Utility bills are 13 percent lower in Colorado Springs compared to the national average. 

Finally, coming in at #10, is an announcement from the city's budget office that 2010 revenues exceeded the budget by $9.5 million and the excess money will be spent fixing potholes.

That's one less bump in the road you will have to worry about !!!

So, smile !!! You live in a great community !!!

 

STUDY: COLORADO ADDED FEW JOBS IN LAST DECADE EVEN AS LABOR FORCE GREW

A study by CSU economists Martin Shields and Michael Marturana was released Tuesday by Colorado State University. The report highlighted jobs that posted the biggest gains and biggest losses in employment during the decade and since 2007.

The study painted a grim picture of the state economy from 2000 to 2010, as two recessions wiped away growth across much of the state. Colorado added few jobs during the decade, even as the labor force added more than 300,000 people and the working- age population soared by 575,000.

"The decade has been a really difficult one in Colorado. There was substantial growth in the labor force but not in jobs," the report said. "In many ways, Colorado has lost a decade."

• The Western Slope and mountains saw the biggest gain in earnings per worker, but the region still trailed the Front Range by more than $10,000 per worker in 2010 and the Eastern Plains by almost $4,000.
• The Front Range lost 5,000 jobs during the decade.
• Educational services, including teachers and employees of private colleges, topped both lists of gainers, followed by ambulatory health care services.
• Specialty trade contractors - the plumbers, electricians and other subcontractors who helped fuel Colorado's building boom - lost the most jobs.

"The construction trades have taken the biggest hit," Shields said. "We're not Arizona, Nevada, California or Florida, where the real-estate markets really melted down, but you can see that it had a significant impact on the state."

Other highlights from the study:

•  Colorado's per-capita income ranking, which had climbed from 19th-highest nationally in 1990 to seventh in 2000, dropped to 16th by 2009.
• Since the start of the recession in December 2007, the state lost more than 126,000 jobs.
• The most jobs were lost - 134,000 - between the third quarter of 2007 and the second quarter of 2010.

P.S. This report emphasizes the urgency of electing a Mayor and City Council that will concentrate on bringing jobs to our area. Your vote is important to the future of our city.

 

INVESTORS DOMINATE DISTRESS SALES

Investor activity dominated a sluggish distress sale market in February as homebuyers are increasingly frustrated by difficulties getting financing, according to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey.

For many homebuyers, mortgage financing is becoming an increasing obstacle. This was highlighted in the latest HousingPulse tracking survey as cash transactions set a new record, accounting for a huge 33.7% of purchases in February. The increase in cash purchases paralleled a rise in investor activity. Investors accounted for 23.5 percent of home purchases in February, up from 19.9% percent in only two months. Investors were obviously driven by the availability of high-quality homes at low prices and the availability of low mortgage-interest rates.

Other factors that persuaded Investors to buy now were the large pool of high-quality renters (former Homeowners) and the upward trend in rents.  

In what could normally be viewed as a positive development, the HousingPulse Distressed Property Index or DPI, a key indicator of the health of the housing market, fell from 49.6 percent in January to 47.3 percent in February. This marked the first decline in the DPI seen since last fall.

The bright side of our present market is that Colorado Springs looks better than almost any other area of the country.

Call us at 598-3200, or, toll free at 800 677-MOVE

 

FEBRUARY EXISTING-HOME SALES DECLINE FOLLOWING SUSTAINED GAINS Washington, DC, March 21, 2011

Existing-home sales fell in February following three straight monthly increases, according to the National Association of REALTORS®. Existing-home sales are 2.8 percent below the 5.02 million pace in February 2010.

Newly constructed homes command higher prices than existing homes. Newer appliances, newer building materials and such, plus the new homes being generally larger-sized, account for most of the difference.

Historically the premium of new home price above existing home price has been about 15 percent. However, recent price data say that the premium has risen to 45 percent. That is, the median price of new homes in January was $230,600 versus the median price of existing homes of $157,900.

The much lower existing home price is partly due to distressed home properties on the market that are selling for much less than the replacement cost. Still, the exceptionally large price differential between new and existing homes may imply that either new home prices have to fall or that there is good growth potential for existing home prices.

The bright side, however, is that existing-home sales remain 26.4 percent above the cyclical low last July, according to Lawrence Yun, NAR chief economist.

 

SELLERS' MARKET A YEAR AWAY, SURVEY SAYS

Daily real estate News  |  March 25, 2011  

While buyer's mostly control the real estate market now, Americans say that will soon change. More than 61 percent of Americans agree that a seller's market is at least a year away, according to the latest Spending and Saving Tracker survey from American Express.

More than two in five Americans--or 41 percent--acknowledge that currently it's a buyer's market in real estate.

Forty-three percent of home owners said they are confident they would receive their asking price when selling their home, but 47 percent said they are not confident or "not at all" confident.

Yet, nearly 40 percent said they would not be willing to settle for less than their asking price.

To make a home more competitive in the marketplace, 44 percent of home owners surveyed said that to sell their home they would include appliances and 28 percent would consider offering to make requested repairs or allowing an allotment for repairs.

If you are considering selling your home, we can assist you in establishing a price and negotiating the deal. As the data shows, it is a very competitive Buyers' market and Sellers need the best, most professional assistance available.

Call us at 598-3200, or, toll free at 800 677-MOVE

And, please remember, I would be honored to serve as your Broker for all of your residential real estate needs. I want to help you, my reader, make the most prudent and accurate Real Estate business decision.

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 39 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.

Just click on the icon at the top of this email to listen to my latest podcast. ..And, if you would like to learn more about our Job Loss Protection Program, please contact us. 

 

LATEST STATISTICS

Click here for the latest Sales and Listing statistics for the Pikes Peak area

 

JOKE OF THE WEEK

  

 

March 21, 2011

HARRY'S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTAIL real estate MARKET

 

THE ANSWER IS "JOBS, JOBS, JOBS"

.THE QUESTION IS WHICH CANDIDATES WILL HELP CREATE THEM

The March 15, 2011 issue of the Gazette reported that Colorado Springs ranked second-worst in the nation for its rising unemployment rate last year, according to the Brookings Institution's Quarterly MetroMonitor report. The only city with a worse job performance last year was Las Vegas.

The good news was that Colorado Springs economic output appears to be rebounding strongly from the recession. The bad news is that we are just not creating any jobs in the process.

How are new jobs created? Well, the process must start with a business-friendly environment and that's a function of the business philosophy of the governing body .in our case, the city council and the mayor.

That's why it's so important that we elect a business-friendly Mayor and Council in the upcoming elections.

For that reason, we felt compelled to advise our readers of the recommendations of the business leaders in our community relating to the upcoming elections. The Pikes Peak Association of Realtors, The Chamber of Commerce and the Homebuilders Association all agree that our community deserves visionary leadership for the future and they have recommended the following candidates for your consideration:

• Steve Bach, Mayor
• Lisa Czelatdko, City Council District 3
• Jan Martin, City Council at Large
• Tim Leigh, City Council At Large
• Merv Bennett, City Council At Large

The Pikes Peak Association of Realtors is also recommending

• Angela Dougan, City Council District 2
• Brandy Williams, City Council At Large

We live in the greatest city in the U.S. Let's keep it that way by creating jobs for our young people, so they don't have to move away to make a living.

 

GOOD NEWS !!!  Big industrial deal in Springs

The Gazette, March, 2011 -- Midnight Sun Capital LLC, in a venture with two Native American Alaskan investment groups, paid $11.175 million for a T-Mobile call center in Colorado Springs, the largest industrial building transaction so far this year in the Pikes Peak region.

The 69,287-square-foot building at 556 Chapel Hills Drive was sold to 556 Chapel Hills LLC, the entity created by Colorado Springs-based Midnight Sun to buy it.

Midnight Sun is a  private equity company headed by Colorado Springs attorney and native Hawaiian, Louie V. Larimer. Larimer is the president and CEO.

The T- Mobile building purchase was a collaborative venture between Larimer and two Alaska Native American corporations -  Cal Corp. and the Aleut Corp. Brady O'Donnell of Johnson Capital brokered the financing, which was provided by Wells Fargo.

The group's acquisition strategy is focused on investing in core Class A income-producing properties.

Founded in 2009, during its first year, Midnight Sun Capital's portfolio accumulated $10 million in assets.  It plans call for an additional $15 million to $20 million in property acquisitions annually through 2012.

 

MORTGAGE RATES FALL AS INVESTORS REACT TO THE CRISIS IN JAPAN

Mortgage rates fell as investors wary of the crisis in Japan sought out U.S. bonds, which lowered yields, according to Freddie Mac's weekly survey of mortgage rates.

Mortgage rates generally track yields, which move inversely to Treasury prices. Rates had climbed early this year, hitting the highest level since April last month after slumping most of last year as Treasurys declined amid economic uncertainty.

"With the crisis in Japan, investors rushed to buy the security of U.S. Treasury bonds, which lowered its yields and other interest rates as well," said Freddie Chief Economist Frank Nothaft.

The 30-year fixed-rate mortgage averaged 4.76% in the week ended Thursday, down from the prior week's 4.88% average and from 4.96% a year earlier. Rates on 15-year fixed-rate mortgages fell to 3.97% from 4.15% in the previous week and 4.33% a year earlier.

Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 3.57%, down from the prior week's 3.73% and 4.09% a year earlier. One-year Treasury-indexed ARMs fell to 3.17% from 3.21% and 4.12%, respectively.

To obtain the rates, the fixed-rate mortgages required payment of an average 0.7 point and the others required an average 0.6 point.

Call us to get the latest rate information available.

 

COLORADO SPRINGS FORECLOSURE FILINGS FALL BY 23.4%

.AND FORECLOSURE SALES FALL BY 37.4%

Colorado statewide foreclosures in February fell by 18 percent from a year earlier, according to the most recent RealtyTrac report.

Even better, our local new filings (288) fell 23.4% from a year earlier and sales of foreclosed properties in February (142) dropped 37.4% from February, 2010. These declines in both foreclosure filings and foreclosure sales are good indicators that our local market is stabilizing.

In fact, the Mortgage Bankers Association shows Colorado faring much better than the overall nation, in terms of delinquent loans, an early indicator of foreclosures. The MBA's National Delinquency Survey shows only 5.9 percent of mortgage loans in Colorado were past due in the fourth quarter of 2010, compared with an 8.9 percent rate nationally. The MBA report showed that Colorado had the eighth-lowest rate of loan delinquency in the fourth quarter and ranked 10th for the lowest rate of serious delinquency, which the MBA defines as loans 90 days or more past due and loans in foreclosure.

The bottom line is that foreclosures are quickly becoming less of a factor in our local market.

 

HOUSING STARTS AND PERMITS STALL IN FEBRUARY

RISMEDIA, March 19, 2011-Nationwide housing starts and issuance of permits for new housing construction both posted disappointing declines in February 2011 as concerns about a growing number of factors caused builders to pull back on production of new homes, according to newly released figures from the U.S. Commerce Department. Total housing starts declined 22.5% from January to a seasonally adjusted annual rate of 479,000 units, the second-slowest pace on record. Equally disconcerting, total permit issuance for new homes fell 8.2% to a record low pace of 517,000 units in February.

National declines in permit issuance were also widespread in February. The single-family sector posted a 9.3% drop to 382,000 units while the multifamily sector posted a 4.9% drop to 135,000 units, and regional declines amounted to 27.8% in the Northeast, 5.4% in the Midwest, 1.4% in the South and 13.6% in the West.

Locally, Single-family homebuilding permits totaled 65 in February, a 60.8% drop from the 166 permits issued during February of 2010. This was the lowest number of permits issued for any month since February 2009, when 53 were issued.

In spite of these discouraging statistics, however, NAHB Chairman Bob Nielsen, is quoted as saying, "Builders are cautiously looking forward to the spring home buying season in hopes that improving economic conditions will help bring more buyers to the table, even though the same factors that have been weighing down the market are still very much in play.

 

FIRST-TIME HOMEBUYERS PREPARE FOR BEST BUYER'S MARKET IN RECENT HISTORY

RISMEDIA, March 18, 2011-While affordable housing prices, ample inventories, and historically low interest rates signal 'buyer's market' for investors or move-up buyers in many U.S. markets, inexperienced first-time buyers may wonder if the time is right to make a move into real estate.

To help first-time buyers know if they're ready to look for the home of their dreams as we head into this year's home-buying season, here's a 'reality checklist' designed to help them decide if the time is right.

Get your financial house in order
Make sure your credit is in good shape and repair any damage previously done. Know your credit score: thirty-five percent (35%) of successful buyers recently reported they didn't know their credit score when they went house shopping, according to a national survey fielded for MortgageMatch.com. Having enough money set aside for a down payment is a key component to making sure you are ready to purchase a home. Also, it's important to not put all of your money in the down payment as other fees or unexpected expenses often arise after closing.

Don't fall in love with a house you can't buy
Find out how much you can afford: establishing your purchase power upfront, including how much money will be required for a down payment and closing costs, is a must for first-time buyers.

Learn the lingo
Since first-time buyers are new to the market and will finance a significant portion of their purchase, it's important to get familiar with the processes and terminology associated with home-buying. Here are a few key terms from MortgageMatch.com to add to your vocabulary:

• Bait rate: Misleading mortgages with low rate promises and no contingencies generally for those with extraordinary credit. Rates are based on: credit, debt-to-income and loan-to-value ratios, the size and type of loan, property location and the day you lock your rate, etc. The loan isn't locked until the application is accepted. By then, it may be too late to find a better rate from another lender.
• Basis point: A term used in the mortgage industry which simply means 1/100th of 1%.
• Closing costs: The fees required to process and close your loan. They're a cash obligation running from 3-5% of the purchase price. Motivated sellers might pay a portion of these costs.
• GFE: The Good Faith Estimate (GFE) is a document explaining all costs involved in getting a loan.

While national rates on 30-year-fixed-rates mortgages have risen slightly this year, they are still at historic lows not seen since 1980, according to Freddie Mac. If you want to land the best mortgage that fits your needs, start early and give us a call. We can make the process smoother and easier to understand.

If now isn't the right time, prepare for your future purchase
If now isn't the right time to buy a home, make a plan with a target date for when you expect to be ready. Improving your credit, paying down debt, stabilizing your work history and calculating exactly how much you can afford, are the best ways to prepare for your future home purchase. It's also important to refrain from making any new large purchases or applying for new credit.

Call us, if you would like to discuss any of the details regarding your home purchase.

HOWEVER, THERE SOME NEW RULES FOR FIRST-TIME HOMEBUYERS

Wall Street Journal  Mar, 20, 2011

Without a house to sell, first-time home buyers have had a field day in the depressed housing market. That is, until recently. New rules, regulations and policies have changed the landscape, making buying that new home harder and more expensive.

Not long ago, first-time buyers accounted for 40% of home sales. Now they're down to 29% and falling, experts say, as first-time buyers confront a steady accumulation of rising fees, costs, and rates. This month, fees on most new mortgages will rise by up to 0.50%. In April, fees on small-down-payment mortgages, a first-time buyer favorite, will spike. Meanwhile, more lenders are requiring larger down payments, and new proposals from the Obama administration call for mortgages to become more expensive and limited in size.

But taken in total, all this reform means the window of opportunity for first-time buyers may be closing. Still, home prices have bottomed out, mortgages are still cheap and interest rates are still low.

So, if you are considering buying your first home, here are some new rules for first-time home buyers.

New rule: Put more money down.

Not because you'll have to -- it's still possible to make a down payment of less than 5% -- but because you want to. Insurance fees on the government-insured mortgages that require just 3.5% down have doubled in seven months, to up to 1.15% (as of April). On a 30-year, $300,000 mortgage, a buyer would pay $30,000 more in fees than if he had signed up for the mortgage in September. Also, between new lender requirements and cash-flush buyers, down payments have been rising since the last half of 2010 and now average 34% of the purchase price, according to the latest data by mortgage-data firm CoreLogic.

New rule: Brace for competition.

Following the housing downturn, desperate Sellers were often eager to accept an offer - any offer. But now, first-time Buyers looking for discounted prices may be disappointed. Over the past few months, investors, international buyers, and downsizing retirees have made a noticeable impact on the market, because they're paying with cash. In January, about 32% of purchases were made with all cash, up from 26% a year ago, according to the NAR. Sellers are often more inclined to accept these offers since they don't need to wait for a lender to approve financing.

and ..Don't limit your home search

Many prospective home buyers believe if they want to get the deal of a lifetime in this market they need to focus on distressed properties, such as foreclosures or short sales, in which the lender accepts less than the mortgage amount. But, eliminating market-rate homes from your search - those sold by willing Sellers to willing buyers - isn't the wisest move.

If you are considering a short sale, the bank will probably respond very slowly. In some cases, it may not respond at all. With short sales, if you are in a hurry, you are probably going to be disappointed.

Also, there is a common misperception that distressed properties are always screaming deals. But, sometimes they are not. Frequently, a Buyer can get a better deal on a market-rate home. Distressed properties account for roughly a third of the inventory right now. Therefore, if you decide you only want to look at distressed properties, you are limiting yourself to a third of the market. And that's crazy.  That means you are ignoring two thirds of the market.

What you should be saying is that I want a house that fits my budget, fulfills my lifestyle needs and is a good value.  That way it doesn't matter whether it is a so-called "distressed" home or a home sold by an individual owner.

 

VACANT DWELLINGS REQUIRE A DIFFERENT KIND OF INSURANCE POLICY

RISMEDIA, March 19, 2011

More and more houses sit unoccupied these days, left behind by their owners in this still-tough economic climate. In 2010's fourth quarter, the Census Bureau reports 12.1% of all U.S. residences, or 18,394,000 homes, were vacant.

But even properties that aren't distressed may take a long time to sell after the owners move on. All of which makes a difference in the kind of insurance coverage such unattended houses require-coverage that isn't offered in the standard homeowners' policy.

Vacant Home Insurance Now, which offers policies in several states, says up to 80% of homeowners do not know that "the provisions of their existing homeowners' insurance policy would essentially end coverage, exposing them to catastrophic loss."

Insurers discontinue coverage on a home if it becomes unoccupied for over 30 days and no new residents have moved in. Some insurers will grant a policyholder a vacancy permit, providing it is requested before the 30 days expire. This permit continues to provide coverage against some of the standard homeowners' perils, such as fire and wind, but does not protect the house against perils such as theft, glass breakage, or water damage.

Coverage provided by a vacancy permit varies from insurance company to insurance company and from city to city, so policyholders should check with their agent or the firm's representative. Some Insurers view a vacant property as a higher liability because often no one is regularly checking it.

A vacant condo is another story, Since the master insurance policy covers such a large part of the condo, including the wall, exterior and roof, a vacant condo is probably going to put a homeowner at significantly less risk.

A homeowner needs to have a specific plan in place to have the dwelling checked periodically by someone..a neighbor or relative, as well as the agent.

We have been advising our clients about the need for 'vacancy insurance' for many years, so, call us to discuss this issue, if you have any concerns about your vacant home.

And, please remember, I would be honored to serve as your Broker for all of your residential real estate needs. I want to help you, my reader, make the most prudent and accurate Real Estate business decision.

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 37 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.

Just click on the icon at the top of this email to listen to my latest podcast. ..And, if you would like to learn more about our Job Loss Protection Program please contact us. 

 

LATEST STATISTICS

Click here for the latest Sales and Listing statistics for the Pikes Peak area

 

JOKES OF THE WEEK

Because these are very short jokes, we decided to give you two, for the price of one, this week.

Unemployment Line

Manny and Fred lived in Brooklyn and worked together. Both were laid off, so they went to the unemployment office. When asked his occupation, Manny answered, "Panty Stitcher. I sew elastic onto ladies' cotton panties."

The clerk looked up Panty Stitcher. Finding it classified as "unskilled labor," she gave him $300 a week unemployment pay.

Fred was asked his occupation. "Diesel Fitter," he replied. Since diesel fitter was a skilled job, the clerk gave Fred $600 a week.

When Manny found out he was furious. He stormed back into the office to find out why his friend and coworker was collecting double his pay.

The clerk explained, "Panty stitchers are unskilled and diesel fitters are skilled labor"

"What skill?!" yelled Manny. "I sew the elastic on the panties, Fred puts them over his head and says: 'Yeah, diesel fitter.'"

 

Birthday Lake Crossing

Turning 21, a boy from Duluth Minnesota named Lars had heard stories of an amazing family tradition. It seems that his father, grandfather and great grand- father, on their 21^st Birthday, had all been able to walk to the boat club across the lake for their first legal drink.

So when Lars' 21st Birthday came around, he and his pal Sven took a boat out to the middle of the lake. Lars stepped out of the boat and nearly drowned. Sven managed to pull him to safety. Furious and confused, Lars went to see his grandmother.

"Grandma," he asked, "it's my 21st birthday, so why can't I walk across the lake like my father, his father, and his father before him?"

Granny looked into Lars' eyes and said, "Because your father, grandfather and great-grandfather were born in January; you were born in July!"

March 14, 2011

HARRY’S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTAIL real estate MARKETPodcast: March 8, 2011

 

MORTGAGE DEDUCTION UNDER RENEWED SCRUTINY

If you own a home, you get a tax deduction on your mortgage interest. But some people now argue that the policy should be changed because:

• It doesn’t really encourage homeownership.
• The government shouldn’t be encouraging homeownership anyway.
• The government can’t keep giving out such a big tax break when it’s facing huge deficits.
• The policy isn’t giving enough of a tax break to lower-income families.

Despite these objections, it will be difficult to revamp a tax deduction that’s been in place for nearly a century. Housing experts are strongly against reducing or eliminating the deduction because they believe it would discourage home-buying, particularly given the weakness of the housing market. Both Congress and the White House would have to approve any change to the tax code, but they could be reluctant to take on such a controversial issue before the 2012 presidential election.

The mortgage-interest deduction works like this: Say a home buyer makes $50,000 a year, and paid $5,000 last year in interest on his mortgage. If he claimed his mortgage-interest deduction, the IRS would tax only $45,000 of his income (or less if he claimed other deductions).

The IRS also lets people claim deductions on interest they pay on a second home or a home equity loan. The home mortgages must be $1 million or less, and the home equity loans must be $100,000 or less.

The mortgage-interest deduction is probably most helpful for people who bought their homes recently. That’s because when you first buy a home, a large portion of each monthly payment goes toward paying down the interest. As you live in your home longer, the portion of your monthly payment that goes toward interest will shrink, and the portion that goes toward principal will increase, at least in most traditional home loans.

The Obama administration’s proposed 2012 budget would leave the deduction in place, but places some limits on the deductions claimed by families making more than $250,000 a year.

The Office of Management and Budget (OMB), which helps the White House develop its budget, estimates that the mortgage-interest deduction cost the government $79 billion in forgone taxes in 2010. That could rise to as much as $144 billion in 2016, the OMB estimates. While some observers argue that the government should get rid of the deduction to help plug its budget gap, others say homeowners should be allowed to keep their money.

The president’s deficit commission advocates changing the tax deduction to a tax credit. It would also cap eligible mortgages at $500,000 instead of $1 million, and eliminate any tax benefits for second homes and home equity loans.

After the deficit commission’s report was released in December, the real estate industry fired back. NAR cited a recent survey of almost 3,000 homeowners and renters.

Nearly three-fourths of the homeowners and two-thirds of the renters said the mortgage-interest deduction was “extremely” or “very” important.

The purpose of the mortgage-interest deduction is to encourage people to buy homes, with the idea that homeowners take better care of their property, contribute more to their neighborhoods and can build wealth.

But some argue that the government shouldn’t subsidize homeownership. The government pushed homeownership hard in the 1990s and early 2000s, and some of the borrowers who got homes couldn’t really afford them. Most experts agree that this was one of the causes of the financial meltdown.

On the other end of the spectrum, some people support changing the deduction because they say it doesn’t actually fulfill its stated purpose, to increase home buying. Australia, Canada and England don’t give out tax deductions on mortgage interest, and they have higher homeownership rates than the U.S.

In fact, some say that the mortgage-interest deduction may actually discourage homeownership. In tightly regulated, land-scarce metro areas, the tax deduction can raise demand for homes but not supply, making it more expensive for people to buy houses.

Furthermore, although the mortgage-interest deduction tends to disproportionately benefit families making $100,000 or more each year, largely because they tend to have the biggest houses and the biggest house payments, middle- and lower-income homeowners tend to actually get a better deal by claiming the standard deduction instead of itemizing their deductions to claim the mortgage-interest deduction.

Some say they doubt that the mortgage-interest deduction is ever a deciding factor when a family chooses to buy a home, though it may encourage some families to buy bigger homes.

The basic question some experts ask is, “Should the government be subsidizing homeownership?”

 

NAR “HOME OWNERSHIP MATTERS BUS TOUR” BEGINS IN CHICAGO

The day before the National Association of REALTORS® started its Home Ownership Matters Bus Tour at the Chicago Flower & Garden Show, REALTORS® from the Chicago area gathered at NAR headquarters for a town hall-style meeting. The topic: the state of home ownership in America today.

2011 NAR President-Elect Moe Veissi, in Chicago for the kick-off of the tour, encouraged REALTORS® to start talking with peers and clients about how much the U.S. economy is affected by home ownership.  ”We need to spread the word,” he said. Key messages he asked members to share:

• The housing market makes up $4 trillion, or about 15 percent, of the total U.S. gross domestic product.
• The housing industry has led the way out of six of the last eight U.S. recessions.
• For every two homes sold in the United States, one job is created.

One of NAR’s key priorities is preventing any chipping away of the mortgage interest deduction as a means of helping to reduce the federal deficit. The push comes at a time when editorial boards of major newspapers such as The New York Times and The Washington Post have come out in favor of eliminating or reducing this tax benefit, which has been in place for almost 100 years.”Home owners already pay a majority of the taxes in this country,” Veissi said.

“The deduction didn’t cause the deficit problem,” Veissi said. “Rather than taking away the deduction, the government needs to look internally at how it can streamline its operations. Small businesses have been making these type of cuts for years.”

Also top of mind for members was the need to fix the financial system and free up capital for qualified buyers. Veissi said. “If we had more financing options, we would sell more real estate today,”

Veissi said NAR strongly favors reforming — rather than eliminating — the government-sponsored enterprises (GSE) that enable the secondary mortgage market to operate. “The GSEs are broken but they’re fixable,” Veissi said. “Without GSEs, we’ll lose the system that helped many of our parents and grandparents become homeowners. If you privatize the secondary mortgage market, you eliminate the concept of the 30-year mortgage,” he said.

The Home Ownership Matters bus tour is an opportunity for NAR to engage with American consumers on these issues.  The bus travels from Chicago to Denver to Portland during the month of March, with a few intermediate stops along the way. The tour’s message is simple but powerful: Home ownership matters to individuals, to communities, and to the country. We hope to see a lot of you as we travel from city to city!

 

FORECLOSURES POST BIGGEST DROP ON RECORD  
 

The number of foreclosure notices filed nationally in February declined 14 percent compared with January, and foreclosure notices dropped 27 percent compared to last year at this time. The number of all U.S. homes in some stage of foreclosure fell drastically last month, reaching a 36-month low. Initial default notices, scheduled foreclosure auctions, and homes repossessed by lenders all dropped in February, RealtyTrac, a foreclosure tracking site, says. This marks the largest year-over-year decline that RealtyTrac has ever recorded.

In El Paso County, foreclosure forecasts dropped to 4200 in 2011, the lowest level in 5 years. Again, the Pikes Peak area outperformed most of the rest of the country.

Nationally, Lenders repossessed 64,643 homes in February, a 17 percent drop from January.

On the national level, initial default notices dropped 16 percent from January — and 41 percent from a year ago. What’s more, foreclosure auctions dropped 10 percent from last month and 21 percent from February of last year, RealtyTrac said.

Rick Sharga, a senior vice president at RealtyTrac, says the real estate market isn’t out of the clear quite yet. He expects foreclosure activity to likely spike again as banks resolve foreclosure paperwork issues.

About 2 million households are in foreclosure proceedings. In addition, about 5 million borrowers are at least two months behind on their mortgage payments.


POLL FINDS 'HALF-FULL' HOUSING OUTLOOK

 The Wall Street Journal (03/10/11)

A new survey of potential home buyers and sellers reveals that 68 percent of respondents believe the housing market and property values will pick up in the next year or two.

Just released, the poll also shows that 86 percent of Americans agree real estate is a good investment despite volatility in recent years; the finding suggests that some buyers may be more optimistic while sellers are wary.

Nonetheless, the survey reports that 78 percent of those who sold homes in the last year were satisfied.

  

 

30-YEAR MORTGAGE RATES HOLD STEADY THIS WEEK
Daily real estate News  |  March 11, 2011  

National Mortgage rates continued to hold steady below 5 percent this week, according to Freddie Mac’s weekly mortgage market survey. Interest rates for 30-year fixed-rate mortgages have averaged at or below 5 percent in every week but one this year, contributing to record home affordability.

Here are how our local rates fared for the week:

- 30-year fixed-rate mortgages: averaged 4.78 percent.

- 15-year fixed-rate mortgages: averaged 4.75 percent.

- 5-year adjustable-rate mortgages: averaged 3.75 percent   

It’s a great time to buy !! Don’t let this opportunity get away !!!

 

_{THERE HAVE BEEN SOME KEY CHANGES IN AMERICANS’ ATTITUDES TOWARD HOUSING AND THE ECONOMY}

RISMEDIA, March 1, 2011—Fannie Mae’s latest national housing survey finds that Americans are more confident about the stability of home prices than they were at the beginning of 2010, even though they lack confidence in the strength of the economy:

The Fannie Mae Fourth Quarter National Housing Survey, conducted between October 2010 and December 2010, polled homeowners and renters to assess their confidence in homeownership as an investment, the current state of their household finances, views on the U.S. housing finance system and overall confidence in the economy.

Seventy-eight percent of respondents believe housing prices will hold steady or increase over the next twelve months, up from 73% in January 2010; but almost two-thirds still believe the economy is on the wrong track, virtually unchanged (61%) from the beginning of last year.

Additional survey highlights include:

Fifty-nine percent of Generation Y (ages 18-34) believes buying a home has a lot of potential as an investment, even though this age group suffered the steepest decline in homeownership during the housing crisis—from nearly forty-four percent when home prices peaked, to under forty percent in 2009.

During 2010, survey respondents increasingly expressed a strong belief that it will be harder for future generations to obtain a mortgage. Three-quarters of those surveyed (74%) believe it will be harder to get a mortgage in the future, up from just over two-thirds at the beginning of 2010.

  

BEFORE YOU LIST YOUR HOME FOR SALE

Today's market presents some very unique opportunities for buyers. With affordability near record highs and interest rates near record lows, many homeowners are making the decision to move up or on. Here a few simple tips to take into consideration when listing your home for sale.

1. Curb Appeal: Buyers make snap judgments about each home they view. These judgments are drawn largely from first impressions. Be sure your home has impressive curb appeal. Fresh flowers and mulched beds, along with trimmed hedges and grass are a must. If your home needs a fresh coat of paint, now is the time. And even if your paint or siding is in good repair, consider painting your front door an eye-catching color, such as red or blue. Remember, most Buyers make up their minds about your house within the first 15 seconds.

2. Inspection: An inspection can make or break a deal. Even after they've fallen in love with your house, a buyer may decide foundation issues or faulty electrical are too much of a headache. The benefits of having an inspection done prior to listing can be two-fold. First, your buyers will be aware of what repairs are needed before they make an offer. Second, you can choose to address these repairs and therefore have them removed from the scenario altogether.

3. Repairs: Buyers are turned off by long lists of needed repairs. This goes double for time-consuming and costly repairs, such as roof work or foundation issues. By identifying and addressing the issues, you may be able to yourself save time and money in the long run.

4. Organize Paperwork: There may be contracts or warranties you have on your home that will transfer to a new buyer. These can include appliances, builder warranties, and even contracts with lawn and pool companies there were paid up-front.

5. Talk to your lender: How much new home can you afford? Are you able to sell your home for enough to cover the remaining balance of the loan? These are important questions to get answered prior to listing!

6. Prepare for showings: Staging a home for sale has multiple different layers. First, you should clean and organize. Have carpets cleaned and repaint dirty or loudly colored walls. Next, remove large and bulky furniture, as these make rooms appear smaller. And finally, take down personal pictures, trophies, and memorabilia that could distract the buyer from what they are actually interested in ... your house!

But, before you do anything else, be sure to contact us as your local expert. We will take care of all of these tasks, and more.

Call us at 1-800 677-MOVE, or 598-3200

 

PRICING A HOME TO SELL

The most popular real estate slogan has always been "location, location, location." Well, folks, there's a new slogan in town, and his name is "price, price, price." You can have the most fabulous Colorado Springs house, but if you are overpriced, you won't sell in today's market.

Here are a few tips to steer you in the right direction.

Comparables: What are homes like yours selling for? Comparables can be found by analyzing homes in your neighborhood, or in nearby neighborhoods, that have similar square footage, upgrades, and amenities. If a comparable home sold for $150,000, there's little chance you'll find a buyer willing to pay $180,000 for your overpriced home. You always want to be the least expensive home in the neighborhood, when it comes to selling, not the most! Everybody loves a deal. We can help you find comparable info in your neighborhood (and remember, with comparables, neighborhoods make a big difference in price).

Be Competitive: Underpricing a home is a strategy that some agents employ to garner interest and to create a bidding war through multiple offers. A well-priced home is sure to get more showings than a home that costs more than the competition. More showings mean more exposure, which ups the chances of you receiving an offer.

Lender Communication: Lenders will only allow a buyer to borrow up to the amount a home appraises for. That means if you are overpriced, even an eager buyer may hit a lending road block.

How Bad You Need to Sell: This is the real kicker. Some homeowners want to sell, but they don't need to. That means they can wait out a down market, or even wait for the "perfect" buyer. If, however, you find yourself needing to move across town, or across the state, then you will have to be more willing in today's market to compromise. And compromise is all about price when it comes to real estate.

Buyers are savvy. Technology allows them to search the local MLS, research the latest trends, and even see how your neighborhood's prices have changed over the last 30 days. They will know if your home is overpriced. It is best to error on the side of too little than too much in this numbers game. If you price your home right, however, you're sure to find a ready and willing buyer.

Again, we, as your local expert, will be able to guide you through these steps and, in fact, will do these things, and many more, to help you get your home sold.

Call us at 1-800 677-MOVE, or 598-3200

 

WHAT ARE TODAY’S BUYERS LOOKING FOR?

According to the 2010 NAR survey of the profiles of Buyers and Sellers, the following list shows the level of importance that prospective Buyers assign to the houses they are considering:

• Price                                             18%
• Size                                               18%
• Condition of home                      17%
• Distance from job                       14%
• Size of lot                                     13% 
• Distance from home/family          7%
• Quality of neighborhood               7%
• Quality of schools                         3%
• Distance from schools                 3%

 Total                                                100%

The surprise for us ‘old-timers’ is that quality of neighborhood and schools were so far down the list. Looks like the ‘Dinks’ have taken over the market (Double-Income, No kids).

 

_{ARE YOU AN INVESTOR?    MAYBE YOU SHOULD BE !!}

One thing that surprised us at the recent convention of Leading real estate Companies of the World, in Las Vegas was that Realtors from all over the country reported a significant rise in the number of sales to Investors.

That probably shouldn’t come as a surprise, since our present market contains all of the factors that would look good to prospective Investors …Low prices, good interest rates and a huge pool of prospective renters.

If you’re interested in exploring the possibility of acquiring an investment property, give us a call. This could be the time for starting your empire.

And, please remember, I would be honored to serve as your Broker for all of your residential real estate needs. I want to help you, my reader, make the most prudent and accurate Real Estate business decision.

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 37 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.

Just click on the icon at the top of this email to listen to my latest podcast. ….And, if you would like to learn more about our Job Loss Protection Program, or, about our CyberHomes Complete Market Analysis of a property, please contact us. 

 

LATEST STATISTICS

Click here for the latest Sales and Listing statistics for the Pikes Peak area

 

JOKE OF THE WEEK

You have to be old enough to remember Abbott and Costello, and too old to REALLY understand computers, to fully appreciate this. For those of us who sometimes get flustered by our computers, please read on...
 
 If Bud Abbott and Lou Costello were alive today, their infamous sketch, 'Who's on First?' might have turned out something like this:

 COSTELLO CALLS TO BUY A COMPUTER FROM ABBOTT
ABBOTT: Super Duper computer store. Can I help you?

 COSTELLO: Thanks I'm setting up an office in my den and I'm thinking about buying a computer.

 ABBOTT: Mac?

 COSTELLO: No, the name's Lou.

 ABBOTT: Your computer?

 COSTELLO: I don't own a computer. I want to buy one.

 ABBOTT: Mac?

 COSTELLO: I told you, my name's Lou.

 ABBOTT: What about Windows?

 COSTELLO: Why? Will it get stuffy in here?

 ABBOTT: Do you want a computer with Windows?

 COSTELLO: I don't know. What will I see when I look at the windows?

 ABBOTT: Wallpaper.

 COSTELLO: Never mind the windows. I need a computer and software.
 
 ABBOTT: Software for Windows?

 COSTELLO: No. On the computer! I need something I can use to write proposals, track expenses and run my business. What do you have?

 ABBOTT: Office.

 COSTELLO: Yeah, for my office. Can you recommend anything?
 
 ABBOTT: I just did.

 COSTELLO: You just did what?

 ABBOTT: Recommend something.

 COSTELLO: You recommended something?

 ABBOTT: Yes.

 COSTELLO: For my office?

 ABBOTT: Yes.

 COSTELLO: OK, what did you recommend for my office?

 ABBOTT: Office.

 COSTELLO: Yes, for my office!

 ABBOTT: I recommend Office with Windows.

 COSTELLO: I already have an office with windows! OK, let's just say I'm sitting at my computer and I want to type a proposal. What do I need?

 ABBOTT: Word.

 COSTELLO: What word?

 ABBOTT: Word in Office.

 COSTELLO: The only word in office is office.

 ABBOTT: The Word in Office for Windows.

 COSTELLO: Which word in office for windows?
 
 ABBOTT: The Word you get when you click the blue 'W'.

 COSTELLO: I'm going to click your blue 'w' if you don't start with some straight answers. What about financial bookkeeping? You have anything I can track my money with?
 
 ABBOTT: Money.

 COSTELLO: That's right. What do you have?

 ABBOTT: Money.

 COSTELLO: I need money to track my money?

 ABBOTT: It comes bundled with your computer.

 COSTELLO: What's bundled with my computer?
 
 ABBOTT: Money.

 COSTELLO: Money comes with my computer?

 ABBOTT: Yes. No extra charge.

 COSTELLO: I get a bundle of money with my computer? How much?

 ABBOTT: One copy.

 COSTELLO: Isn't it illegal to copy money?
 
 ABBOTT: Microsoft gave us a license to copy Money.

 COSTELLO: They can give you a license to copy money?

 ABBOTT: Why not? THEY OWN IT!

 (A few days later)
 
 ABBOTT: Super Duper computer store. Can I help you?
 
 COSTELLO: How do I turn my computer off?

 ABBOTT: Click on 'START'..... ........