Tips for selling a home in the winter
November 14, 2011
HARRY’S WEEKLY UPDATE
A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTIAL real estate MARKET
COLORADO SPRINGS IS LISTED AS ONE OF THE “TOP-8 HEALTHIEST HOUSING MARKETS”
Realtor Magazine (November 8, 2011) cites a survey of the healthiest housing markets in the U.S., conducted by Builder Magazine. Builder teamed with Hanley Wood Market Intelligence to compile its annual list, factoring in housing projections from Moody’s Economy.com. The list is based on projected price appreciation, population growth, income growth and improving employment picture.
As the Realtor article points out, the U.S. housing markets projected to have the biggest gains into 2012 tend to be home to major universities, strong private sector employment, or have nearby military bases. Those criteria describe Colorado Springs exactly.
Builder Magazine lists Colorado Springs as number “8” on its list, and points out that troops returning from Afghanistan will boom our economy. Local home prices are predicted to rise 2.6%. Employment is predicted to grow by 1.4% and households to increase by 1.8% in 2012.
Ain’t you glad you live here??
HOME PRICES DROPPED IN 2011 …BUT COLORADO SPRINGS IS BETTER OFF THAN MOST OTHER AREAS
Last week the National Association of Realtors released their current analysis of the previous four quarters of median home prices in the largest 150 communities in the U.S. As expected, in the four quarters ending September 30, 2011, prices declined an average of 4.7% nationally. But the good news is that Colorado Springs median home prices dropped only 3.8%. In other words, we are 19% better off than the rest of the country…..
How might this data affect your decision to buy a home now? Well, let’s look at a specific example. Let’s say you have been considering buying your $250,000 home in Colorado Springs. With a 3.5% down-payment of $8,750, that would bring the amount financed to $241,250. To that number, we must add the FHA mortgage insurance (a one-time 1.5% payment) of $3,618.75. So, the entire amount financed by the lender would be $244,868.75. In today’s market, the numbers would work out like this:
Monthly Principal and Interest payment (3.75%) $1,134
Monthly mortgage premium (.5% MIP) $102
Estimated monthly real estate taxes $125
Estimated monthly home insurance premium $80
Total monthly payment $1441
But that doesn’t tell the whole story. Don’t forget that, as a homeowner, you get to deduct several expenses from your taxable income. Using the example we cited, above, your annual deductions would amount to:
- Home Interest payments $9,106
- Property taxes (estimated) $1,500
- Total $10,606
Assuming that your tax bracket is 28%, those two credits would mean an annual tax credit to you of $2,970, or $248 a month. When you deduct that tax credit, it brings down your actual cost of ownership to a monthly expense of $1,193. ($1,441 - $248)
The bottom line is that, if you are paying anything like $1,193 a month in rent, you are missing out on the opportunity to build your total worth (equity) and your estate, the ability to put a lid on your housing expense for the next thirty years (thus avoiding the constant problem of ever-increasing rents) and the satisfaction of owning your own home….And, by the way, the Gazette (Friday, Nov. 11, 2011) notes that rents in Colorado Springs soared to a record-high in the third quarter and are expected to keep climbing as demand remains strong ….In fact, if you are now living as a renter in that same home we used in our example, you are probably paying approximately $1,450 a month….That means it is costing you $257 more per month to rent that house than it would cost you to own it. …Strange, but true !!!
And, keep in mind that these numbers won’t look this good forever. The fact is that, with every passing day, as foreclosures and short-sales are absorbed back into the market, there will be fewer homes in the inventory, thus increasing prices,….also, there will absolutely be increases in interest rates (We are currently at an historically low rate) ….and, inflation is also scheduled to drive up home prices dramatically.
Bottom line: It is less expensive to own a home in Colorado Springs than it is to rent.
Call us at 598-3200, or 1-800-677-6683 to discuss this once-in-a-lifetime opportunity. Act now, and you will be sending me ‘Thank-You’ notes for the next 30 years.
FORECLOSURE FILINGS AND SALES DOWN IN EL PASO COUNTY
The Colorado Springs Business Journal reports that third quarter foreclosure filings and sales at auction were down statewide and in El Paso County. Foreclosure filings dropped nearly 25% in the third quarter of this year, according to a Colorado Division of Housing report.
The number of foreclosure home sales dropped more than a third from 746 in the third quarter of 2010 to 497 in the third quarter of 2011.
While new filings are on the rise for the year, 2011 is still shaping up to have the lowest number of foreclosure filings and sales at auction since 2009, according to the state division of housing.
Although it’s probably too soon to start singing, “Happy Days Are Here Again”, it looks like the band should begin to tune up.
SURVEY REVEALS WHY BUYERS ARE WAITING ON THE SIDELINES
According to Realtor Magazine (Nov.9,2011), a recent survey by Move, Inc. shows that 27% of Americans say they plan to buy a home in the future (with most saying in two or more years), and only 2% say they plan to purchase a home in the next 12 months. So, why are so many buyers continuing to wait when home affordability is so high and interest rates are so low?
About 23% of those surveyed say they are delaying buying a home because they are concerned about the real estate market in their local area, particularly with concerns about the future of home values, the economy and jobs, as well as difficulty in saving for a down-payment.
Nearly 35% of those surveyed say their inability to get credit or find affordable credit are the main reasons why they are putting off purchasing a home.
The survey also found that younger adults tend to spend more on housing than older adults. For example, the survey revealed that two out of five – or, about 40% of millennials, say they should spend 30% to 60% of their gross monthly income on housing. More than half of older Americans, on the other hand, say they plan to spend less than 30% of their gross wages on housing.
The survey also discovered that seven out of ten Americans say that candidates’ positions on housing will be very important to them in the 2012 presidential and congressional elections.
Survey respondents identified the following top housing priorities for the next president’s first 100 days in office:
- Helping homeowners avoid foreclosure
- Keeping interest rates low
- Making more affordable mortgage credit available
Errol Samuelson, chief revenue officer of Move, Inc., said in a statement, “Our survey found that 27.3% of Americans still plan on buying a home. The survey illustrates candidates who share the concerns of the American people and make housing a top priority will win their confidence.”
TIPS FOR SELLING A HOME IN THE WINTER
Experts offer some of the following tips for selling a home in the winter.
- Stage it:
Arrange furniture so the selling-points in the home are not overlooked
Paint rooms inviting colors
Display pictures of the home in warmer, summer months
Turn up the heat to a comfortable level. Cold homes don’t sell
Price it right
Keep sidewalks and driveways clear of snow, ice and leaves – giving potential buyers a clear path to your front door.
Light it up:
Keep all the light on, even when you’re not there
Open the blinds and drapes
Hire me as your agent (I just stuck that in there, to remind you that a good agent can help you get your house sold. Give us a call at 598-3200, or, 800-677-6683 (MOVE).
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 39 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 podcast for this month …
LATEST SALES AND LISTING STATISTICS
Click here to see the latest Sales and Listing statistics for the Pikes Peak area.
JOKE OF THE WEEK
THERE WAS LIFE BEFORE THE COMPUTER
An application was for employment
A program was a TV show
A cursor used profanity
A keyboard was a piano!
Memory was something that you lost with age
A CD was a bank account!
And if you had a broken disk,
It would hurt when you found out!
Compress was something you did to garbage
Not something you did to a file
And if you unzipped anything in public
You'd be in jail for awhile!
Log on was adding wood to a fire
Hard drive was a long trip on the road
A mouse pad was where a mouse lived
And a backup happened to your commode!
Cut--you did with a pocket knife
Paste you did with glue
A web was a spider's home
And a virus was the flu!
I guess I'll stick to my pad and paper
And the memory in my head
I hear nobody's been killed in a computer crash
But when it happens they wish they were dead!
