HARRY'S BI-WEEKLY UPDATE 9.22.21
September 22, 2021
HARRY’S BI-WEEKLY UPDATE
A Current Look at the Colorado Springs Residential real estate Market
As part of my Special Brand of Customer 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.
YOU’RE PROBABLY WONDERING WHY I PUT THIS INFOGRAPHIC UP FRONT…AND I’M ABOUT TO TELL YOU…
As I’ve been saying for the last couple of years, there is no “normal” anymore when it comes to buying and selling Residential real estate. And the “new normal” keeps changing all the time.
We all keep hearing about how homes are appreciating faster than ever, mostly due to the lack of available homes for sale and the historically low interest rates. And with the internet, it’s easy today to seek out prices of homes that sold in your own neighborhood or what Zillow or other sites say your home is worth. This can be very misleading, and I’ll relate a recent experience I had so that illustrates this.
I had clients who had already purchased a new home and wished to sell their current one. They had looked at what homes in their neighborhood had recently sold for and had decided that considering the recent buying frenzy, their home was worth a certain amount, and they would take nothing less for it.
When I did the research and then went to their home, I knew that the figure they had in mind was not realistic and that it wouldn’t get a lot of potential buyers at that price. I gave them my estimate and explained my reasoning and they did not agree with it due to their previous “research”. Against my advice, it was listed it for what they requested. After several initial showings and no offers, the general feedback from showing brokers was that the house was overpriced.
I tried to explain this to my clients, but they still did not agree. Not to get into any greater detail and to make a long story short… after three weeks and two price reductions, the house did sell at the price that I had originally told them I thought was reasonable.
The point I’m making here is that seasoned, knowledgeable real estate professionals are the best investment a seller can make when it’s time to list their home. And listening to what they have to say regarding the price point and other matters can make all the difference in getting an offer that not only is acceptable but will likely make it to the closing table.
When I see commercials on television where real estate agents are quoting very low commission fees, and more, I think to myself, “well, you get what you pay for!”. There is so much that goes into getting a home ready for sale and not taking it step by step can make a lot of difference in the selling experience for a client.
I’ve sold thousands of homes in the last 48+ years and have found that my recommendations for fixups, selling price and more have made a big difference in how the entire process goes.
The market is a bit less frenetic now with a few more homes coming available, but multiple offers and ones over listing price are continuing to happen. Knowing which offer will likely make it to closing is an important part of my job and I’m not simply in this for a quick sale. I am in this business to make long lasting relationships and am thrilled when I get a call from children and even grandchildren of past clients who want me to represent them in buying and/or selling a home.
If you’ve even considered a move, let’s talk and see how together we can make your wants, needs and budget work toward that goal. There’s no better time than now to make all of your Residential real estate dreams come true.
And…the best move you can make at present is to call me at 593.1000 or email me at Harry@HarrySalzman.com to get the ball rolling.
I look forward to speaking with you.
THE BIGGEST MISTAKE HOME BUYERS AND SELLERS CAN MAKE
The Wall Street Journal, 9.20.21
I woke up yesterday morning to this headline when I opened The Wall Street Journal and I had to smile. The whole front page of the Journal’s Wealth Management section had that headline. The subtitle said:
“For many people, it’s their largest investment—and their most emotional one. That can be a bad combination.”
And I thought to myself, “I could have written this”! So, I’d like to share with you some excerpts from the article.
BUYING MISTAKES:
- Picking a so-so location. Too often people may fall in love with a house and forgive it for the company it keeps. There could be a lot of distracting outside noise, or other such problems. This violates the first rule of real estate which is: location, location, location.
This is probably truer today than in the past as desperate buyers find themselves pushed out of coveted neighborhoods due to the shortage of available homes.
If at all possible, try to find a home in an area that fits what you want and need because some day when you go to sell that home, location will likely play an important role there, especially if the market isn’t as hot as it is today. You can always add a bathroom or other things, but you can never change the home’s location.
- Buying a house sight unseen. Oftentimes an online listing may include professional photography, 3-D floor plans and virtual walk-throughs, but nothing can replace an in-person visit.
Today’s market can make buyers feel they need to make a decision without seeing the home in person or without other family members who will be living there but be prepared for things to be quite different than they might look in a listing.
- Waiving the inspection. In today’s market, a number of buyers have offered to waive preliminary inspections to make their offers more enticing to the sellers. That can often be a big mistake and a costly one. Even if one is planning to raze a home to build a new one, it’s important to have an inspection. Some old homes can have asbestos in the roof or air-conditioning or an inground septic tank, which would be important to determine prior to tearing down the home.
- Getting a high maintenance vacation home. When buying a weekend retreat or vacation home, most people focus on the properties they have “dreamed about”, rather than the cost of ownership. It’s important to remember that you don’t want your second home to become a “second job”.
- Tying your own hands. Do you want to be told what color to paint your home or where to park your car? Or how often to mow your lawn? If the answer to those questions is no, you might not want to buy in any community controlled by a homeowner’s association. It’s important to read the rules and regulations of the HOA prior to buying a home in that community.
SELLING MISTAKES:
- Showing the house at its worst. We are all so connected to our homes that sometimes we don’t see its flaws. But the buyers will. They want to picture themselves living in the home and if it’s too cluttered or full of your personal mementos that makes it more difficult for the potential buyer to see themselves living there. Get rid of clutter and do everything to help show the home in its best light.
- Not planning for capital-gains taxes. If your home has appreciated in value, which is quite likely in today’s market, the profit could be subject to capital-gains taxes. Certain home improvements can potentially help reduce the tax bill—but only if the seller has documentation showing that the improvements increased the home’s market value, prolonged its useful life, or adapted it to new uses.
- Mishandling the sale of an estate. The impact of a mistake is not felt just when the owner is alive. If a homeowner doesn’t provide a detailed estate plan—and have clear communications with heirs—disputes over the estate can delay or even scrub a home sale after the owner dies. Similarly, homeowners who bequeath a home to heirs in hopes of keeping it in the family often fail to provide funds to cover the annual costs of maintaining it. As a result, heirs may be forced to sell, even if a down market prevents the house from getting top dollar.
- Fudging facts and flaws. “Maybe they won’t notice” is sometimes a mantra of sellers who are hoping that buyers won’t see the problem with the roof, or the signs of former water damage—even though sellers by law are required to disclose any known deficiencies in a home.
It’s important to establish trust between the buyers and sellers. That’s how you can get the best price for your home. When you withhold information, the buyer can get more aggressive if they feel you are hiding something from them and this could affect the potential buyer’s price offer.
So there you have it. Just some random thoughts from The Wall Street Journal and me! Any questions, just give me a holler.
IS THE housing market SLOWING DOWN?
Keeping Current Matters, 9.21.21
This is the question I’ve been asked for the last year and there’s no denying these are interesting times in Residential real estate.
And there is no easy answer.
The Millennial generation, long known for putting home buying on hold, has become ready for ownership. As more and more young people across the country started looking, they added to the already record breaking buyer traffic.
The only problem was the lack of available homes to meet the demand. That inequity in the market is the root cause of the price appreciation that has many worried that we’re in another “housing bubble”. But unlike 2008, the rise in home values was warranted. It wasn’t price inflation. It was price appreciation caused by simple economics: a lack of supply and high demand.
Today, economists are noticing a softening in the market, but nothing that should alarm potential buyers or sellers.
That doesn’t mean it’s crashing. It means it’s finally leveling out to a more normal market with more normal appreciation.
Like any other year, buyer traffic peaked in April and May (the spring market) and is slowing as summer ends. However, it’s important to note that those levels remain similar to where we were one year ago, which is great news for both buyers and sellers. As competition slowly declines and inventory levels rise, experts project a steady softening of the steep high appreciation we’ve seen in the past year.
HAVE YOU EVER SEEN A housing market LIKE THIS? (Infographic)
Keeping Current Matters, 9.17.21
I thought you’d like to see this infographic but keep in mind that as good as some of this looks, Colorado Springs’ numbers look even better!
Bottom Line? Whether you’re buying, selling, or both, today’s housing market has lots of good news for you. And if you’re currently renting, there’s no better time to start looking to own than the present. A note to investors—with rents rising all the time, buying an investment property might be something worth considering.
BUILDING MATERIAL PRICES SEE LARGE INCREASES YEAR TO DATE
National Association of Homebuilders, 9.9.21
I’ve been writing about how new home construction has been a challenge this year, with rising costs of materials, backorders for much of the same and high demand from sellers. In fact, some homebuilders are quoting price “estimates” with no guarantee of delivery dates at times! I thought the information here might explain some of those reasons.
While the recent drop in softwood lumber prices since early summer has helped bring down costs (after having drastically driven them up earlier in the year), the decline has been offset by large increases of several other building materials.
The prices of these 10 have increased the most thus far in 2021, and all are up at least 30%:
- Steel mill products
- Building paper and building board mill products
- Asphalt
- Plastic water pipe
- Fertilizer materials
And between April and July, these materials experienced price increases exceeding 20%:
- Laminated veneer lumber
- Building paper & building board mill products
- Fertilizer materials
- Plastic water pipe
- Fabricated structural metal
- Other engineered structural wood members
- Copper pipe and tube
- Steel mill products
- Aluminum base scrap
As you might imagine, this has made it quite difficult for home builders, but it is also affecting those of us who are renovating our present homes. We’ve been doing just that at our home, and it is taking far longer for materials and even for workers to become available than I can ever remember.
My advice? Just be patient. It’s all we can do at present. And we can hope that materials, delivery times and worker availability will start to normalize sometime soon!
