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Monday, February 6, 2012

by Harry Salzman

February 6, 2012

HARRY’S WEEKLY UPDATE
A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTIAL real estate MARKET

21st ANNUAL IREM BREAKFAST PRESENTS ROSY ECONOMIC FORECAST

On Thursday, Feb. 2, 2012, along with about 275 other attendees, we attended the Institute of real estate Management’s 21st Annual Breakfast at the Doubletree Hotel. The meeting featured speakers from the real estate profession and from the City of Colorado Springs’ Economic Vitality Division.

Their annual forecast included overviews of all aspects of the real estate market ….Multi-family, residential, commercial, etc. The consensus of the speakers was that our local real estate picture is improving, with some segments growing faster than others, and we were especially pleased to hear their optimistic view of our local residential real estate market.

Some of the factors that were noted as boosting our local residential real estate market were:

• Inventory of homes is down (3,157- the lowest total for any month since 3,116 listings in Feb. 2002)
• Foreclosures are down
• Short sales are down
• Interest rates are down
• Unemployment is down
• Troop levels at Ft. Carson are growing
• Consumer confidence is growing

As for rentals, rental occupancy is currently at 94% and pressure increases daily for higher rents. Since 2006, monthly rental prices have risen steadily, from $909 in 2006 to $1163 in 2011. The average lease price (rent) is up 18%. These factors all lead the experts to say, “Buy rentals now and hold them as they increase in value”.

In our current market, the strategy that many experts are recommending for investment buyers is based upon the fact that single-family home prices went up 12.6% in the second half of 2011, while prices for condos and townhouses during that same period have not yet started to rise, but appear to have bottomed-out.

If we had to boil all of the presentations down to a single strategy for our readers, it would be to give serious consideration to:

• Upgrading to a better home, without significantly increasing your monthly payment. (If you can afford a $1000 mortgage payment monthly for 30 years, the current low prices and low mortgage rates would enable you to buy a $250,000 home right now) ……. and,
• Retain your current home as an investment property, rather than selling it ……..Or, at least
• Refinance right now, to take advantage of the current, record-low mortgage rates.
• Keep in mind that, if you wait too long to buy, hoping that prices will go down, you might wind up spending a little less for your house, but a lot more for your mortgage.

Give us a call to discuss your options, at 598-3200, or 800 677-6683(MOVE).

BUILDING PERMITS UP IN 2012 AND LOCAL UNEMPLOYMENT RATE STAYS AT 9%

The Pikes Peak Regional Building Department reports a January 3.7% gain in single-family building permits over January of 2011. John Cassiani, board president of the Housing and Building Association of Colorado Springs, stated, “The economy is getting better. You’ve got a lower unemployment rate in Colorado and in Colorado Springs, and I just think all the signs out there seem to be positive in terms of getting the housing industry back in the right direction.”

In a related story, the U.S. Bureau of Labor Statistics reports that the latest 9% unemployment rate in November and December remains the lowest in more than two year and is down sharply from a record 10% last February.

FEWER FORECLOSURES LOCALLY IN JANUARY

Fewer homeowners fell into foreclosure in January in the Colorado Springs area, which continued a trend of reduced foreclosure activity during 2011, according to Tom Mowle, head of the El Paso County Public Trustee’s Office.

Mr. Mowle stated, “The people who have taken out loans the last four to five years will be less likely to find themselves in default and the people who took out the creative loans six to eight years ago have either been renegotiated with lenders or fallen into foreclosure”

Foreclosure sales in El Paso County totaled 2,060 last year, down 21.7% from 2010.

SPRINGS COST OF LIVING STILL BELOW U.S. AVERAGE

Living costs in Colorado Springs were 6.8% below the national average during 2011, according to a survey by the Council for Community and Economic Research.

“The cost of living here remains well below the national average, which has always been a strength for Colorado Springs”, said Tom Binnings, a senior partner with Summit Economics, a local economic research and consulting firm.

Local utilities costs still remain 9.4% below the national average, while our overall energy costs are the lowest in the state. Dave Grossman, a spokesman for Colorado Springs Utilities stated, “the average monthly residential electric bill rose last year to $65.77, while the average natural gas bill fell 2.3% to $48.28.

Local costs for housing and transportation also moved further below the national average.

HERE’S SOME MORE LOCAL GOOD NEWS

According to the Gazette, in Colorado Springs in January:

• Initial claims for unemployment were down 3.7%
• The unemployment rate was down to 9%
• New auto and truck registrations were up 35.2%
• Foreclosure filings were down 16.4%

DID YOU KNOW THAT JANUARY IS THE BEST MONTH TO BUY A HOME?

In reviewing the sales statistics for the past 20 years, we notice that January is the slowest sales month in every year. In every January there are fewer sales and the average selling price is at its lowest level for the year. This January, for example, sales totaled 474, which was 3% more than last January. The median price was $172,250. There were 3157 listings available (which is 27% fewer than last year [4326] and represents the lowest number of available homes since February of 2002. 86% of all sales in January were below $299,999.

After January, both sales and prices start to go up, so call us to take advantage of the lowest prices you will see in 2012.

SALES AND LISTING STATISTICS

CLICK HERE to see the latest Sales and listing statistics for the Pikes Peak area.

And be sure to give us a call, if you have any questions, or would like to discuss these statistics in more detail.

Call us at 598-3200, or, 800 677-6683.

THINKING OF BUYING A FORECLOSURE? BE SURE TO ASK THESE 4 QUESTIONS
Daily real estate News | Tuesday, January 31, 2012

Foreclosures can offer big bargains, but buyers need to be careful that they don’t get over their heads in purchasing a home that may need more repairs than they bargained for.

Foreclosures are usually sold as-is, and homes that are left vacant standing too long can have a lot of maintenance problems.

real estate experts suggest buyers consider the following questions:

1. How long has the home been vacant? Be cautious of a foreclosed home that has stood vacant for more than a few weeks or had its utilities shut off a long time. Marvin Goldstein, a home inspector for many foreclosed properties, says a home can deteriorate quickly when heating, cooling, electricity, and running water have been turned off for a while.
2. How old is the home? Goldstein says that homes that are more than 50 years old may have a failing plumbing system or inadequate electrical wiring.
3. How does the home look? Are there broken windows, gutters hanging down, or damaged siding? “Trust your instincts. If the house looks bad from the outside, it's probably worse than you think,” Goldstein said.
4. Is there anything missing? Sometimes former owners remove anything of value from the home, such as built-in light fixtures, bathroom tile, water heaters, air-conditioning units, and hardwoods, says Bill Jacques, president-elect of the American Society of Home Inspectors.

Housing experts encourage buyers to get a home inspector to look at the property, even if it is sold as-is, so that home buyers know any repairs needed and cost estimates before they purchase the home.

“Buying a bank-owned home gives you the opportunity to enter the market at a very low price level,” says Dorcas Helfant, a past president of the National Association of REALTORS®. “You can find terrific values among foreclosures, especially if they're not in too bad shape. But, remember, these houses are discounted for a reason.”

Editor’s note: We totally agree with the 4 points made in the article and, for many years, we have consistently worked with our clients to address these problem areas. We also suggest that you call us, if you are considering buying a foreclosed home. We have access to a lot of information that does not appear in the listing and would be happy to share it with you.

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. Call us at 598-3200,or, 800 877-MOVE (6683).