Enewsletter June 28, 2010
HARRY'S WEEKLY UPDATE
A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTIAL real estate MARKET
IS THE ELEVATOR GOING UP OR DOWN?
It's almost impossible to tell if the economy is getting better or worse, by reading the papers. Within the last week, for example, some of the featured stories in The Gazette and in The Wall Street Journal were headlined, "Mountain West's Recovery Staggers", "Signs Signal Improvement in Local Economy", "Hiring Picks Up Only slightly", "Springs is 20th- best Among Nation's Metropolitan Areas", "Sales of New Homes Plunge", "Mortgage Rates Hit New Lows", "Occupancy Rates Leaping At Springs Hotels".
Now, there's a collection of headlines that would confuse anyone. But, here are some facts that tell a very clear story:
- Mortgage rates are at an all-time low. You can now buy a home with a rate as low as 4%.
- Home prices are very low. The foreclosures and short-sales that are now on the market have pulled down the price of every other listing. (To get an idea of how dramatic this is, call me about our Featured Listing shown at the end of this eNewsletter).
- Inflation will almost certainly rise, as new government expenditures begin to affect the economy
- Mortgage rates will eventually rise
- Home prices will eventually rise
How can you benefit from these facts? Well, let's assume that five years ago you bought a home and created a loan for $250,000. Your mortgage payments are $1,580.17 per month for a 30-year mortgage with a rate of 6 1/2%. Your current balance is $234,027 which you will be paying on for the next 25 years.
Today, you could put that $234,027 towards a bigger home in a better neighborhood, refinance at 4%, and end up with a 15 year mortgage that would cost you $1,731.07 per month (only about $151 per month more than you are now paying). By doing this, you will be living in a better house, you will have taken ten years off your mortgage and, more importantly, you would be able to pay off your mortgage completely by the time you are ready to retire.
Prospective Homeowners and Investors may never have an opportunity like this again!! Call me.
FOOT-DRAGGING BY BANKS MAY HALT UP TO 140,000 CLOSINGS
As we all know, the recently deceased First-Time Homebuyers' Tax Credit was offered to Homebuyers who closed on the purchase of their homes by June 30th, 2010. Unfortunately, many eligible sales will have failed to close by that deadline, primarily because of the slow response time of their lenders. Now, Congress has chosen not to extend the closing deadline, thus voiding the tax-credit for the 140,000 Buyers involved. Unfortunately, many of these Buyers, if they do not get this tax-credit, may back-out of their contracts. This would be a very unfortunate problem for the already-strapped real estate market.
The federal tax credit proved to be a great incentive for Buyers and, since its expiration, home sales have dropped off by 32%. This represents a record-low seasonally-adjusted annual rate. The expiration of the tax-credit and an excess supply of existing homes for sale also lead to a decline in new-home construction and applications for home-buying loans.
NEW FEDERAL AGENCY TO BE CREATED TO OVERSEE BANKS AND FINANCIAL MARKETS
At a cost of only $19 billion per year, Congress is about to enact the most sweeping remapping of financial regulation since the 1930s. The overhaul will put U.S. banks and financial markets under tighter government control for years to come, according to The Wall Street Journal.
The legislation expands the regulatory reach of Washington's major agencies, including the Federal Reserve, Securities and Exchange Commission and Commodity Futures Trading Commission. It also creates, under the Federal Reserve, a new "consumer protection" agency, the Consumer Financial Protection Bureau, with power to oversee all manner of financial products from mortgages to credit cards.
Opponents of the bill are concerned that it could restrict access to credit and enshrine the idea that the government won't allow big firms to fail. The bill sets stricter limits on prepayment penalties, fees for paying off a loan early. Banks say that potential for greater liability could lead to higher costs for borrowers and provisions that require stricter checks on a borrower's ability to pay could make it harder or more expensive for self-employed borrowers or for those who rely on commission or seasonal income to qualify for loans.
NEW SURVEY REVEALS TOP "MUST-HAVES AND BIGGEST "TURN-OFFS" IN A HOME
Forget that "man cave" or home theater room: what men crave more than women in a new house is a luxurious bathroom, a guest bedroom, a dining room and views. On the other hand, female house hunters value a home office more than a kids' playroom, dining room or luxurious bathroom. These are just a few of the more surprising findings of a recent survey of 1,000 house hunters by ZipRealty.Inc.
Other survey highlights:
- Both men and women home hunters rated green features higher this year compared to 2008, with 27 percent of this year's respondents ranking a green home high priority.
- The percentage of home shoppers ranking a home office as a high priority is up from 35 percent in 2008 to 39 percent in 2010.
- The three biggest turn-offs when viewing a home in person are structural damage, bad odors, a busy street and an awkward floor plan. While searching online, lack of parking and few or no photos and low square footage are the biggest deal-breakers.
Top 10 Most Desired Home Features:
1. Garage or parking space 86.8%
2. Master suite 78.9
3. Ample storage space 72
4. Large or walk-in closets 66.5
5. Guest bedroom 66.4
6. Outdoor entertainment area 64.3
7. Gourmet or updated kitchen 60.6
8. Breakfast room or eat-in kitchen 55.8
9. Large yard 43.2
10. Wood floors 40.8
Male versus Female House-Hunting:
Must-Haves and Deal-Breakers Differ
"Overall, the same things you would always expect to top the list of 'must-haves' and 'deal breakers' for house hunters still show up, but it is interesting to see men place a higher priority than women on things often characterized as stereotypically female priorities, such as a luxurious bathroom and a dining room," said ZipRealty Vice President of Marketing Leslie Tyler. "Also, women's growing desire for a home office may speak to the fact that more women are working from home these days."
- A higher percentage of women reported ample storage and a large yard as a high priority compared to men, and reported that when viewing a home in person they would be turned off by small bedrooms and a lack of common space more often than male respondents. In fact, 60 percent of women compared to 49 percent of men reported they wouldn't consider a home with small bedrooms.
- Forty-four percent of men rated a home with a view as a high priority, compared to only 33 percent of women, while 28 percent of men reported a luxurious bathroom as a high priority, compared to only 23 percent of women, and more than 70 percent of men indicated a guest bedroom as a must-have, compared to only 63 percent of women.
- A higher percentage of men reported when searching for homes online disdain for outdated furniture or paint and unkempt landscaping compared to women -- and men reported they're more likely to be turned off by a lack of curb appeal than women are.
Top 10 Features Desired by Men
1. Garage or parking space 85.5%
2. Master suite 79.8
3. Ample storage space 71.2
4. Guest bedroom 70.2
5. Large or walk-in closets 64.2
6. Outdoor entertainment area 63.4
7. Gourmet or updated kitchen 59.1
8. Breakfast room/eat-in kitchen 55.2
9. View 44.5
10. Large yard 43
Top 10 Features Desired by Women
1. Garage/parking space 87.7%
2. Master suite 77.8
3. Ample Storage Space 72.7
4. Large or walk-in closets 68.7
5. Outdoor entertainment area 64.2
6. Guest bedroom 63.9
7. Gourmet or updated kitchen 61.8
8. Breakfast room/eat-in kitchen 56.1
9. Large yard 43
10. Wood floors 40.9
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.
JOKE OF THE WEEK
The ANT and the GRASSHOPPER
OLD VERSION
The ant works hard in the withering heat all summer long, building his house and laying up supplies for the winter. The grasshopper thinks the ant is a fool and laughs and dances and plays the summer away.
Come winter, the ant is warm and well fed. The grasshopper has no food or shelter, so he dies out in the cold.
MORAL OF THE STORY:
Be responsible for yourself!
MODERN VERSION
The ant works hard in the withering heat all summer long, building his house and laying up supplies for the winter. The grasshopper thinks the ant is a fool and laughs and dances and plays the summer away.
Come winter, the shivering grasshopper calls a press conference and demands to know why the
ant should be allowed to be warm and well fed while he is cold and starving.
CBS, NBC , PBS, CNN, and ABC show up to provide pictures of the shivering grasshopper next to a
video of the ant in his comfortable home with a table filled with food.
America is stunned by the sharp contrast.
How can this be, that in a country of such wealth, this poor grasshopper is allowed to suffer so?
Kermit the Frog appears on Oprah with the grasshopper and everybody cries when they sing, 'It's Not Easy Being Green.'
ACORN stages a demonstration in front of the ant's house where the news stations film the group singing, "We Shall Overcome."
Political demagogs appear on TV to condemn the ant and blame President Bush, President Reagan, Christopher Columbus, and the Pope for the grasshopper's plight. In an interview with Larry King, they fume that the ant has gotten rich off the backs of grasshoppers, and they call for an immediate tax hike on the ant to make him pay his fair share.
Finally, the EEOC drafts the Economic Equity & Grasshopper Opportunity Act retroactive to the beginning of the summer.
The ant's taxes are retroactively raised by 50% and, because he cannot pay them, his home is confiscated by the Government Green Czar and given to the grasshopper.
The story ends as we see the grasshopper and his free-loading friends finishing up the last bits of the ant's food while his new house (which happens to be the ant's old house), crumbles around them because the grasshopper can't get a government loan to pay for maintaining it.
The ant disappears in the snow, never to be seen again.
Eventually, the grasshopper is found dead in a drug related incident, and the house, now abandoned, is taken over by a gang of spiders who terrorize the ramshackle, once prosperous and once peaceful, neighborhood.
The entire nation collapses, bringing the rest of the free world with it.
MORAL OF THE STORY:
Fairy tales ain't what they used to be
