HARRY'S BI-WEEKLY UPDATE
February 25, 2013
HARRY’S BI-WEEKLY UPDATE
A Current Look at the Colorado Springs Residential real estate Market
4th QUARTER METRO AREA HOME PRICES--STRONGEST PERFORMANCE IN 7 YEARS
National Association of Realtors
The just published “Median Sales Price of Existing Single-Family Homes for Metropolitan Areas” from the National Association of Realtors (NAR) has great news again. As always, we track comparison of the Colorado Springs metropolitan area against the other 152 metro areas in the survey. This most important highlights are:
- Median home prices across the USA are 10% higher than a year ago
- Colorado Springs Metro Area is up 11.5% from a year ago, which translates to 15% better than the median sales prices across the USA
The median existing single-family home price rose in 133 out of 152 metropolitan statistical areas and Colorado Springs is one of those that showed significant performance.
Lawrence Yun, NAR chief economist, said all the conditions for strong price growth are at play. “Home sales are on a sustained uptrend, mortgage interest rates are hovering near record lows and unsold inventory is at the lowest level in 12 years,” he said. “Home sales are being fueled by a pent-up demand and job creation, along with still favorable affordability conditions and rents rising at faster rates. Our population has been growing faster than overall housing stock, so supply and demand dynamics are very much at play.” He added that more housing construction is needed to relieve some pressure to keep home prices from overheating.
NAR’s national annual Housing Affordability Index, with breakouts for metropolitan areas rose to a record high 193.5 in 2012 from 186.4 in 2011. The index is calculated on the relationship between median home price, median family income and average effective mortgage interest rate. The higher the index, the stronger the household purchasing power.
An article in The Gazette this past Friday reiterated these same statistics, saying that U.S. home sales in January rose to the 2nd highest level in 3 years. And REALTORMag reported that 88% of U.S. Cities have seen prices for single-family homes rise in the 4th quarter of 2012.
I’ve been telling you for more than a year to expect this and now it’s all happening even faster than I might have predicted. As positive as this report is, there are now some problems arising. Compared to the last few years, there are fewer homes on the market, days on the market are vastly shortened and rents are rising. If you are considering buying a home, trading up or purchasing for investment purposes, NOW is the time. It is going to take a bit longer to find what you are looking for in this market but fortunately you have me, with my 40 plus years of experience. I have always enjoyed doing your homework for you and that gives you an advantage over the Buyers and Sellers who work with most other Realtors.
To see the report in it’s entirety and to compare Colorado Springs to the other 152 metropolitan cities, please click here. As always, I am here to answer any questions you many have from this survey or any real estate questions in general. Just call me at 598.3200 or email me at Harry@HarrySalzman.com and I will be happy to help in any way I can.
FOREIGN BUYERS ARE JUMPING INTO THE U.S. SINGLE-FAMILY RENTAL MARKET
Several publications have reported that foreign firms are starting to snatch up single-family homes at a rate not previously seen. Some of these are groups of private investors, others are large companies, but all have the same idea—either buy a number of foreclosures at a discount from the present mortgage holders or simply purchase directly from local Realtors and convert these properties to rentals in exchange for hoped for large gains when the U.S. housing market fully recovers.
The Wall Street Journal reports that “the business of buying and renting houses, long dominated by local mom-and-pop investors, has morphed over the past two years into one of the hottest investments on Wall Street. Investors from countries whose currencies are strong can outbid U.S. investors because they also are hoping to make money from foreign-exchange rate fluctuations.”
What does this mean to you? Clients who I’ve talked with lately have considered either buying more investments properties or buying their first one. Well, the time is ripe and with rental prices on the rise, I’ve got two things to tell you. One--more renters are starting to look at home buying options. Two--those renters that can’t qualify will be looking for a long term lease on a home.
I am available to help in either scenario. If you know someone who is currently leasing and tired of rising rents, have them call me and let’s see if we can help them get into a home of their own. And for those of you looking for investment property, don’t wait too long. Your choices are narrowing each month. Haven’t you earned the right to receive a good rate of return as an investor/landlord? If it’s a consideration, just call me at 598.3200 and I’ll help you determine the right financial option for you.
2013 WILL BE THE YEAR MANY BUY THEIR FIRST HOME
The Gazette/Wall Street Journal/Sunday, 2.24.13
Yesterday there was an interesting article reprinted in The Gazette from the Wall Street Journal that provided good suggestions to those who are considering buying their first home. I was happy to see it in our local paper and find it especially appropriate advice for anyone looking to buy in today’s competitive, fast paced buying market. Here are the highlights:
- Stay Calm. Don’t spend more than you can really afford and don’t get caught up in a bidding war. Don’t wait until the last minute to look for a home you need NOW.
- Make Your Best Offer. Be realistic and bold, if necessary. There is a danger of over-paying a little but if it’s the RIGHT house for you, you might go for it. Don’t spend more than you can afford, though.
- Check Credit. You should know your credit report and credit score prior to meeting with a lender. That way, any discrepancies can be cleared up and with a higher score you are in a better position to negotiate for your mortgage. Credit reports can be checked at AnnualCreditReport.com where you are entitled to one free report annually from each of three credit-reporting companies at this site.
- Account For Assets. Obtaining a lender’s pre-approval is always a good idea and if you intend you use “gift or transfer funds” you need to be able to document that you are not simply borrowing that money or it will not be counted towards a down payment.
- Bring A Big Down Payment. If possible, bringing more than 20% for the down payment will help keep your offer competitive.
- Be Nice. This might include showing some flexibility on the closing date. If all else is equal, the seller might be more concerned with a little flexibility on the part of the buyer rather than a little extra money.
- Find A Good Agent. That’s where I come in. With more than 40 years experience in the local real estate arena, you know I’ve got your back and will make certain that you don’t make any costly mistakes. This goes for first time buyers as well as those I’ve sold many homes to and for over the years. I will always put your needs first and make certain that I can help you make a financial decision that is within your means, can satisfy your wants and provide a good, safe investment for you and your family. I’m simply a phone call away at 598.3200 anytime you, your family members or friends are looking for a qualified real estate agent who will work for YOU.
NOW A WORD TO SELLERS….THERE’S GOOD NEWS FOR YOU, TOO
With so much happening in the real estate market at once, I know some of you who have been waiting for your home values to rise are wondering if maybe now’s the time to think about listing your home.
In the Colorado Springs market, sellers have more of an edge than they have had in many years. The biggest reason is that the number of existing homes on the market has dropped dramatically and continues to do so. Also, homes are selling much faster.
I would be happy help you by doing a Fair Market Value Analysis of your home to determine it’s present value and whether or not it’s the right time for you to list it. Just call me at 598.3200 and we can get the process started.
SOMETHING TO THINK ABOUT….SOONER THAN LATER WOULD BE BETTER
No one likes to think about dying, but as it’s a fact of life, there is no better time than the present to think about your end-of-life-planning. There are many things to be considered and your accountant and lawyer are among those who would be your best advisors in that area. I’ve witnessed many problems that can occur when considerations about titles, home ownership and other such things haven’t been thought out in advance.
In today’s tech savvy world, we’ve got things to consider like passwords, and on-line account information that needs to be protected as well as documented in case of death.
There are usually unexpected financial hassles after a death, and it’s always a blessing when someone has taken the time to deal with as many of the foreseeable issues as possible. I am not in a position to advise you as to the best way for you to handle your individual estate planning, but I always advocate that it’s better to be safe than sorry.
JOKE OF THE WEEK
Why did the chicken cross the road?
To get the New York Times.
Get it?
No.
Neither do I. I get USAToday.
Why didn’t the hen cross the road?
Because she was too chicken.
Why did the baby cross the road?
She was stapled to the chicken.
Why did Colonel Sanders cross the road?
He heard there was a chicken on the other side.
Why did Colonel Sanders cross the road again?
He was being chased by a million finger-lickin’chickens.
What do you get when you cross a chicken with chewing gum?
Chicklets.
What do you get when you cross a hen with a banjo?
A chicken that plays a tune when you pluck it.
Why was the chicken so bad at baseball?
The kept throwing fowl balls.
Why didn’t the turkey finish his dinner?
He was already stuffed.
Why did the chicken cross the road in Texas?
To show the armadillo how it’s done.
Why did the Roman chicken cross the road?
She was afraid someone would Caesar.
Why did the muddy chicken cross the road and then back?
He was a dirty double-crosser.
What do you call it when a chicken stumbles as it crosses the street?
A road trip.
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