October 4, 2010 

HARRY'S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTIAL real estate MARKET

 

LET'S TALK ABOUT SHORT SALES -

A term that has become very familiar to anyone involved with real estate in today's market is "short sale". This process allows a homeowner to sell his/her house for less than his/her mortgage balance, if the mortgage-holder (lender) approves the deal. The benefits of a short sale are that it allows the lender to avoid the lengthy and expensive process of foreclosure. It allows the homeowner to avoid the financial and credit-related problems arising from foreclosure. And, finally, it offers buyers the opportunity to acquire bargain-priced properties.

So far this year, 12% of home sales nationally have been short sales. Locally, in August, 6.4% of our home sales were short-sales. To help put this figure into perspective, consider that in August of 2007, just before the national recession hit, short sales made up just 1.8% of our local sales. 

So, what's the problem?

In today's market, the bottleneck in this whole short-sale process has been the banks. For whatever reason, banks have taken so long to respond to prospective buyers' offers for short-sale properties that many prospective buyers get tired of waiting for approval from the lender and just give up and walk away from the deal.

Banks cite a lack of personnel as the main reason for this excessive delay in responding to short-sale offers. However, Congress does not view that as a valid excuse for the delays and has introduced a bill (H.R. 6133, "Prompt Decision for Qualification of Short Sale Act of 2010") that would require lenders to respond to consumer short-sale requests within 45 days. We fully support this effort and hope that it will eliminate the bottleneck that currently frustrates all parties involved in the short-sale process.

This is the problem that we discussed in our interview with The Gazette last Sunday. As we pointed out in that interview, there are some short sale great deals out there, but, in order for you to take advantage of them, you will need the assistance of a knowledgeable Realtor. ..a Realtor who knows how to work with local and national lenders and who can negotiate effectively on your behalf. And, you will also need the patience to work with your Realtor to push the offer through the maze of short-sale obstacles to a successful closing.

Call us.

 

LATEST STATISTICS

The latest Pikes Peak Association of Realtors Sales and Listing report for the month of September shows total monthly residential sales of 603. The average sales price was $230,419 and the median sales price was $195,000.

Total sales for January through September were 6,371. The average sales price was $227,467 and the average number of days on the market was 89.

The monthly statistics show that the number of sales this September was down 26.7% compared with last year. Sales were down 12.4% this August compared with last year, but the average sale price this September was $230,419, which represents a sale price increase of 4.3% over last year. (Click here to see the complete PPAR monthly report)

Bottom line: So far this year, the number of sales is down, but prices have risen 4.3%.

Normally, a "Reasonably balance" of sales vs homes for sale consists of a 3-4 month inventory. Using current sales history, we now have a 10 month inventory of homes for sale.

So, if you are an investor, or a prospective investor, consider all of these facts: There is an oversupply of homes for sale. Prices seem to have bottomed-out and are on the rise. Interest rates are still at record lows. (Today, we can arrange for a 30 year, fixed-rate mortgage at 4.75%). You can "buy cheap", right now.

If you are a seller, or, if you would like to sell your home but have been scared off by the very competitive market, consider this: You can probably refinance your present home at a lower rate. You can purchase a new home at a low price and at a great interest rate and keep your present home as a rental property. You can then ride out the present slump in prices and wait until the market goes back up to sell your present home (or, keep it as a rental. Either way, you win).

If you are uneasy about owning rental property, consider this. Leaving aside details such as population growth, today there are as many families in homes as there were five years ago. The difference is that five years ago, perhaps 30% of those families were renters and 70% were homeowners. Today, the percentage of renters is rising.. Because of foreclosures and short sales, more families are either renting or looking for rentals. They could be your first renters in your new rental property. How does this tie in with your retirement plans?

Call us.

 

THE 2010 SOUTHERN COLORADO ECONOMIC FORUM WAS EXCITING

As always, the SCEF was a "sold-out" success. Leaders from the local and national business communities joined with UCCS and with local "Think Tank" experts to present a detailed picture of where our local economy is and where it is going. The topics discussed were encouraging for our local businesses and forecast a healthy recovery over the next few years.

To quote from the Forum Report's Business Conditions Index, "As of June 2010, the BCI is up approximately 19.1% from its low. The local economy is exhibiting traditional recovery patterns in most BCI components. Foreclosures peaked, building permits are increasing, manufacturing activity is increasing and new car sales are increasing. Much of this is reflected in the almost 30% improvement in consumer sentiment since February 2009".

In future Weekly Updates, we will report in more detail about the presentations at the Forum  In the meantime, we offer our thanks to all of the people who presented the Forum and who are working so hard to improve the economy and the quality of life in Southern Colorado.

Things are definitely looking up !!!

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

Heaven is a place where:

  • The lovers are Italian
  • The cooks are French
  • The mechanics are German
  • The police are English
  • The government is run by the Swiss

Hell is a place where:

  • The lovers are Swiss
  • The cooks are English
  • The mechanics are French
  • The police are German
  • The government is run by the Italians