July 24 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.

LET’S TALK ABOUT RENTALS FOR A MOMENT OR TWO…

The record-setting statistics that I’ve been showing you lately are continuing, but with that great news I’ve also been writing about the shortage of available listings.  That’s been affecting a number of my clients, which I’ll write more about later on.

The biggest news now is “RENTAL PROPERTIES”.  According to an article in Saturday’s Wall Street Journal, “Wall Street is the New Suburban Landlord.”  What this means is that large companies are buying up homes and then renting them our rather than selling.  And many individual investors are also scooping up homes as investment properties.

Other companies are purchasing multifamily condo buildings, buying the units back from owners, and converting them into rental apartments.

The reasons are varied, but most agree that since homeownership is the lowest in five decades it’s likely to stay that way and that rent rates will continue to rise.  These same investors are “wagering that many people no longer see owning a home as an essential part of the American dream” states the Journal article.

If the Millennials and Gen Zer’s want to maintain the suburban lifestyle of the past they are going to need to rent—especially at first.  Many of these folks have substantial college debt, no down payment, no real credit, and low FICO scores.  Others don’t know where they will end up career-wise so a non-permanent solution makes sense. 

Homes are also increasing so quickly in value so what might have been affordable for first-timers could be impractical today.  Slowly rising interest rates are also beginning to slow down the market.

Even some experienced homeowners who might have recently sold their home quicker than expected and without having decided where to go could need temporary lodging for several months.  And if they were planning on moving into a newly constructed home it might not be ready just yet.

I’ve had a number of clients purchase rental properties in the past year and a half.  If that is something you have even considered—NOW is the time.  Home prices are escalating and rental prices are too—so while you’re building equity in your investment you are also collecting rent with the option to raise it at the end of a lease. 

Someone I recently spoke with has been purchasing rental properties for more than 15 years.  Recently she decided to have the homes appraised and low and behold—her equity is now more than a millions dollars.  That’s the EQUITY—not including the actual home values.  Most impressive to say the least.

Homes have been doing better than stocks, bonds, equities, etc for some time now, with few exceptions, so if you own your own home you are probably ahead of the game and happy about it.  If you owned another property you would not only be gaining equity, but most likely receiving rental income that would cover your monthly payment and then some. 

According to a study recently released by REAL Trends, Inc and NEXZUS Publishing Group, about 23 percent of residential home built for one to four families are now owned by investors.

Out of about 125 million households in the U.S., an estimated 43 million live in investor-owned housing units according to the study.  “While most real estate industry and consumer publications have focused on the impact institutional buyers have had on this rental market, the facts show that it is somewhat ordinary American families who own the majority of these investor-owned residential properties.”

There are a number of things to consider if you are interested in rental property and since I’ve been putting my money where my mouth is for many years I can give you advise and answer most questions you might have.  I can also help direct you to a qualified property manager if that is the way you want your rental property handled.  In that case, you would not have to worry about the upkeep and other duties of a “landlord” and would be paying someone else to care for your property while still receiving the benefits.

I also get asked the tax questions a lot but will always refer you to your personal accountant and/or investment advisor as I’m not qualified to give you advise in those areas.  Each person needs to see how investment property fits into their own financial portfolio and only these professionals can help you with that.

If you are anyone you know are interested in discussing how to make rental property work for you, I’d love to discuss it.  Just give me a call at 593.1000 or email me at Harry@HarrySalzman.com and let’s talk.

I also am available to help those looking to rent a home if that is the option.  You can also pass on my information to anyone who might need help in that area.

My 45+ years in the local real estate arena along with my personal brand of customer service make me one of the best choices you can make for yourself, a friend or a family member when it comes to any form of residential real estate. 

I can you help buy, sell, buy new construction and buy for investment purposes.  I do it all.  I do it well.  And I do it with extensive knowledge of not only the Colorado Springs market  and regulations, but with long professional relationships with local realtors and builders, which can help you in getting what you seek. I look forward to helping you again soon.

 

JUNE 2017 LOCAL MARKET UPDATE AND MONTHLY INDICATORS ILLUSTRATE OUR CONTINUING UPWARD TREND IN GREATER DETAIL

Pikes Peak REALTORS® Services Corp.,

These reports, issued today, of the continued fabulous residential real estate growth contain much greater detail than the first of the month reports and cover ALL residential areas in the Pikes Peak Region.

The local median sales price increase year-over-year in all properties was 8.3%, a good sign that our housing market is continuing to appreciate.

In the recently published June 2017 Monthly Indicators and Local Market Update for El Paso and Teller Counties, new listings year-over-year were up 7.9% for the single-family/patio homes and up 9.1% for condo/townhomes. 

This is a good indication that folks are now realizing that it is a GREAT time to list a home and trade-up or move to a new neighborhood.  The only drawback, as I keep mentioning, is that you need to know where you intend to move BEFORE you list your home as it is going to sell much faster than it would have in past years.

     The “Activity Snapshot” for June 2017 shows the one-year change:

  • Sold Listings for All Properties was up 8.6%
  • Median Sales Price for All Properties was up 8.3%
  • Active Listings on All Properties was down 22.0%.

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. I recommend that you check out your own neighborhood, or one that you are considering, to get a good idea of what’s transpiring there.  I have reprinted just one neighborhood, Southwest, below to show you the type of information available for all local areas.

              

Despite rising home prices, interest rates, while slowly rising, are remaining historically low for the time being as I mentioned above.  That won’t always be the case, so “sooner than later” should be your motto if a real estate move is in your immediate future.  If you’re thinking of a move or looking for investment property—I’m just a phone call away.

 

COLORADO SPRINGS IN THE NEWS...AGAIN

The Gazette, 7, 18 & 22,.17

Our unemployment rate was the lowest in the nation for the fourth consecutive month.

It remains a record low for the state in records beginning in 1976 and is the fourth-lowest of any state during the 41-year period.  Wow.

According to Rich Wobbekind, senior economist for the Leeds School of Business of UCBoulder, “This rate does suggest we are at full employment.  We are really scrapping the bottom of the barrel.  At 2.3 percent, the people who are unemployed don’t have the skills needed for the current job openings, so employers either have to find the people by recruiting out of state or from people who have retired but are willing to come off the sidelines to be part of the workforce again.”

 

We are the 28th best for first time homes among 62 cities with a population of 300,000 or more.

A new study released last week by WalletHub , a personal finance website, submits that Colorado Springs remains a great place for first-time homebuyers.  Only caveat here—IF they can find an affordable starter home.

The survey is based on nearly two dozen measurements of market attractiveness, affordability and quality of life. 

This would be great news—as any recognition is—but we are falling short in providing homes these first timers can afford.  This is just another reason that buying rental property is a smart idea.  A number of these young folks who are choosing to move here will need housing until they can afford to buy their own home.

 

NEW CONSTRUCTION PRICES COULD ESCALATE AS FIRES BURN CANADIAN FORESTS

The Wall Street Journal, 7.24.17

The wildfires in Canada are pushing up the price of lumber and threatening the supply to U.S. homebuilders.  This fire season across the border has been harder on the lumber industry than in more than a decade.

This comes at a time when existing home listings are so low that many folks are seeking new construction.  I’ve been taking a lot of clients to see if new constructions can help in their home search to satisfy their wants, needs and budget.  The problem has been that the builders are swamped and building as quickly as they are able to keep up with the new demand.

Now when you add this to the mix, the price of new homes will have to increase along with the price of lumber.  And that’s hoping that the supply holds steady.  If not, it will not only cost more, but the wait will be longer.  This is another reason to buy NOW.

Demand is continuing, but lot availability is becoming an issue and rising interest rates could also limit some from buying.

That said, though, the Colorado Springs issued 1,781 permits for new construction of single-family homes for the first half of 2017—matching that of the first half of 2016 when the annual total of permits were at the highest level since 2006.

So all in all..it’s been a good year for new home construction, too. 

 

FEATURED LISTING

New listing coming tomorrow! 

Motivated Seller.

Recently listed with another realtor for $835,00. 

Now it is:  $759,000.

Gated in The Village at Stratton Preserve

1855 Cantwell Grove

Colorado Springs

Call me for more info