March 20, 2017

 

HARRY’S BI-WEEKLY UPDATE

          A Current Look at the Colorado Springs Residential real estate Market

As part of my Personal Service, it is my desire to share current real estate issues that will help to make you a more successful and profitable buyer or seller.

SO THERE’S A “NEW NORMAL” YOU MIGHT WANT TO KNOW ABOUT…

It’s been crazy out there in real estate Land in recent months and it’s getting more so by the day.  I’ve been filling you in on some of the quick turnarounds and higher than list price sales I’ve been involved in recently, and now we have another situation that I’ve not seen in this area before.

The shortage of available listings has caused a frenzy that has led to the quick turnarounds and higher than list offers, however, appraisers have not yet prepared themselves for this.  What I mean by that is when an appraiser looks at a home for the lender in order to justify the mortgage amount, the home needs to come in at close to or above the selling price.  Since homes are selling so fast and for so much, the appraisers have no real “comparables” – the price at which other similar homes have sold for. 

What this means to all of us is that the appraised value of many homes is coming in lower than anticipated.  That affects both the buyers and the sellers—and oftentimes that is the same person who is moving to trade up.  The difference between what a person is paying for a home and what the lender is willing to lend has to come out of the buyer’s pocket.  And sellers are affected the same as they have to accept less for their home to compensate for the appraisal unless they want to go through the listing process all over again. 

This is causing frustration on both sides.  I’m hoping that somehow the appraisers quickly become more aware of what’s going on in our market and will begin valuing homes at closer to what a buyer and seller agree is a fair price rather than on what homes “used” to be worth.  Our higher median sales prices are great for us but the appraisers and lenders need to keep a better pulse on what’s happening out there.

Most potential sellers believe that waiting until spring is in their best interest and traditionally they would be correct.  NOT THIS YEAR.  Part of the “new normal” has disproved the traditional fact that buyer demand has seasonality to it.  Demand is very strong all over and the economy, job market improvement and interest rates have driven it to this point.  We shall see what happens as the rates start to rise, but I suspect the frenzy will get even worse before it settles into a more established pattern.

Now let me tell you about the local “new” construction market.  In recent weeks, I’ve had a number of clients who wanted new construction as they have the time to wait for a home to be built.  I visited a number of homebuilders for them to seek out the types of floor plans and prices that they wanted and after narrowing it down, we began our search.  When we got to the new home sites—another big surprise—a number of the lots and homes that we had wanted to consider were already under contract! 

That, folks, is exactly how quickly things are moving in the Pikes Peak real estate Market.  You will see if the following stories more of what’s happening both locally and nationally.

I realize this is a “mixed bag” of positive news shadowed by some “hiccups” but “where there’s a will there’s a way” they say and somehow I always can find a way to make things happen. 

If you’re ready to make a move or even see how this “new normal” might affect you, please give me a call sooner than later at 598.3200 or email me at Harry@HarrySalzman.com and let me put my special brand of personal service to work for YOU.

 

FEBRUARY 2017 LOCAL MARKET UPDATE AND MONTHLY INDICATORS PROVIDE RESULTS IN GREATER DETAIL

Pikes Peak REALTORS® Services Corp.,

In the recently published February 2017 Monthly Indicators and Local Market Update for El Paso and Teller Counties, new listings year-over-year were down 4.0% for the single-family/patio homes and up 19.9% for condo/townhomes. 

The median sales price increase year-over-year in all properties was up 5.5%, which is a good sign that the housing market is continuing to appreciate.  If there were more listings, more people would be moving—either selling to trade up or buying for the first time.

     The “Activity Snapshot” shows the one-year change:

  • Sold Listings for All Properties was down 8.8%
  • Median Sales Price for All Properties was up 5.5%
  • Active Listings on All Properties was down 28.9%.

You can click here to read the 16-page Monthly Indicators or click here to get specific information on the neighborhood of your choice from the 33-page Local Market Update. These reports provide greater detail than the monthly “PPAR Monthly Statistics” that I share in the first eNewletter of each month.

You can see why now is a great time to list your home.  The only drawback, as I’ve mentioned time and again, is that you need to have an idea of where you want to go because your home will likely sell much quicker than it might have in the recent past.

If you have any questions about either of these reports please give me a call. 

 

COUNTY WEBSITE NOW LIVE AND PROVIDES EXCELLENT INFORMATION

The Gazette, 3.13.17

Looking for property information and other data, including census, sales and permit numbers in El Paso County?  County Assessor Steve Schleiker has great news for you.  A new website, years in the making, is now live and can provide you will all that information and more.

While the site is an especially important resource for the real estate community, Schleiker said “it can be utilized by a number of different offices and departments in El Paso County in getting information out to our citizens.”

He is hoping it will also be a useful resource for businesses or families interested in moving to the county who are now able to look up average property values, sales growth, population data, and even the number of parks and schools in areas of their choosing by using the map’s zoom function. 

To visit the site, go to www.elpasoco.com and click on the banner link across the top of the web page.

 

COLORADO SPRINGS JOB MARKET RANKS THIRD BEST IN THE COUNTRY

The Gazette, 3.14.17

And the good news just keeps on coming.

According to a survey by staffing firm ManpowerGroup, the Colorado Springs job market ranks as the nation’s 3rd best for the second quarter 2017.

The survey indicated that 28 percent of employers surveyed were expecting to hire and none planned layoffs.  The rest anticipated no change or weren’t certain of their plans.

This is the city’s best outlook in 10 years.  The outlook level in the second quarter 2017 is more than twice as strong as the first quarter’s 12 percent and up from 16 percent a year earlier.

 

3 QUESTIONS TO ASK IF YOU WANT TO BUY YOUR DREAM HOUSE

keepingcurrentmatters, 2.21.17

There’s so much talk about the housing market at present and though your friends and family will have your best interest at heart, they may not be fully aware of your needs and what is currently happening in the real estate market.

Ask yourself the following 3 questions to help determine if now is a good time for you to buy in today’s market.

  1. Why am I buying a home in the first place?

This is truly the most important question to answer.  Forget finances for a moment.  Why did you even begin to consider purchasing a home?  For most, the reason has nothing to do with the money. 

For example, a survey by Braun showed that over 75% of parents say “their child’s education is an important part of the search for a new home.”

This survey supports a study by the Joint Center for Housing Studies at Harvard University which revealed that the top four reasons Americans buy a home have nothing to do with money.  They are:

  • A good place to raise children and for them to get a good education
  • A place where you and your family feel safe
  • More space for you and your family
  • Control of the space

What does owning a home mean to you?  What non-financial benefits will you and your family gain from owning a home?  The answer to that question should be the biggest reason you decide to purchase or not.

  1. Where are home values headed?

According to the latest Existing Home Sales Report, from the NAR, the median price of homes sold nationally in December (the most recent data available) was $232,200, up 4.0% from last year.  The increase also marks the 58th consecutive month with year-over-year gains.

If we look at the numbers year over year, CoreLogic forecasted a rise by 4.7% from December 2016 to December 2017 nationally.  On a home that costs $250,000 today, that same home will cost you an additional $11,750 if you wait until next year.

What does that mean to you?

With prices increasing each month, it might cost you more if you wait until next year to buy.  Your down payment will also need to be higher in order to account for the higher price of the home you wish to buy.

  1. Where are mortgage interest rates headed?

A buyer must be concerned about more than just prices.  The “long term cost” of a home can be dramatically impacted by even a small increase in mortgage rates. 

The Mortgage Bankers Association, the NAR, and Frannie Mae have all predicated that mortgage interest rates will increase over the next twelve months.  We’ve seen evidence of that starting to happen as the Federal Reserve just increased their rates this month.

Only you and your family will know for certain if now is the right time to purchase a home and answering these 3 questions will help you make that decision.

 

FED VOTES TO RAISE RATES:  THE HOUSING IMPACT

RealtorMag, 3.17.17

Last Wednesday the Federal Reserve starting picking up the pace by raising its key interest rate just three months after its last rate hike.  In announcing that short term interest rates will increase by one-quarter of a percentage point, they also suggested that two similar increases will occur later this year.

“If you think it’s been hard so far to find a home that fits your budget and your needs, it’s going to get worse,” say Jonathan Smoke, realtor.com’s chief economist.  “There will be even fewer homes for sale now.”

Homeowners who already have lower mortgage rates locked in may have less incentive to trade up or buy a new home.  Their increasing desire to stay put could continue to press already tight inventories of home for sale all across the country.

As of last Tuesday, the 30-year fixed-rate mortgage averaged 4.39 percent, according to Mortgage Daily News.  Last summer, rates were near record lows of 3.44 percent.

As long as rates keep changing slowly, “The small changes we’re seeing shouldn’t price too many people out of homeownership,” Smoke says, “But if you keep adding it on, it will price people out.”

There’s time to take advantage of what are still historically low rates, but that time may be running out.  If you’re looking to lock in a good rate, sooner rather than later needs to be your motto.

 

HARRY’S INTERESTING real estate FACTS OF THE DAY

The Hartford Courant, 2.21.17

  1. We hear a lot about foreclosure statistics and how many homes are “underwater” (meaning that the owner owes more on the house than it would sell for in the marketplace today).  Did you know that almost 30 percent of Americans own their home “free and clear,” without a mortgage?  That’s approximately 21 million households.

 

  1. In the United States, there are five times as many vacant houses as there are homeless people.

 

  1. Warren Buffet is one of the richest men in the world, and he still lives in the same house he bought in 1958.  He paid $31,500 for it.

 

  1. In 2009, there were more foreclosures in the United States than there were marriages.

 

  1. In Scotland, homeowners paint their door red when the pay off their mortgage.

 

  1. In the United States, if you see a winged eagle over the front door, it may mean that the homeowners have paid off their mortgage.  The eagle symbolizes “freedom” from the mortgage payment.

 

  1. A homeowner’s net worth is over 30 times greater than that of a renter.

 

  1. Charles “Pretty Boy” Floyd was a Great Depression era gangster who was viewed positively by the public.  When he robbed banks, he would destroy mortgage documents, which freed many citizen of their debts.

 

  1. Think your house is too small?  The typical home site in many developing countries is 75 square feet.

 

  1. According to the Aspiring Home Buyer Profile, conducted by the NAR in 1981, a typical first time buyer purchased a 1,700 square foot home, costing $70,000 ($201,376 in inflation and adjusted dollars).  In 2006, at the height of the market and before the “burst of the bubble” (and the era of McMansions), a typical first time homebuyer purchased an 1,815 square foot home, costing $214,000.  In the 2016 survey, purchased homes were 1,650 square feet and cost $182,500.

 

  1. Eight out of 10 non-homeowners indicate that owning a home is part of their American Dream.

 

  1. Being unable to afford to buy is the number one reason non-owners list as to why they don’t.

 

  1. The average mortgage down payment for homebuyers has been 6 percent for first time buyers for the last three years running.

 

  1. Those in the business point out that unrealistic expectations about how much of a down payment is necessary to purchase a home have kept credit worthy borrowers with manageable levels of debt from exploring the prospects of buying a home.

 

  1. Ninety percent of those that responded to the 2016 NAR Survey indicated that they worked with an agent to buy or sell a home, rather than go it alone.

 

  1. Some doorknobs disinfect themselves, including lead, iron, silver, aluminum and copper.  The best material to use for a self-disinfecting doorknob?  Brass.

 

FEATURED LISTING

 

“THIS SPACE AVAILABLE FOR YOUR LISTING”

 

I’m all sold out.  I can’t keep a listing around for long so if you’re ready to sell—I’m ready to list. 

Just give me a call today and we can get you headed toward a new home.