Real Estate Information Archive

March 22, 2021

 

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.

 

OF COURSE THERE ARE…AND…I’VE GOT THE ANSWERS…

In recent days I’ve discovered that my clients and potential clients have far more questions about home buying and selling than even in the most recent past.  A lot of this is due to information overload from television commercials and internet searches, as well as “mis-information” from various sources.

Is now the time to buy?  Or is it the time to sell?  What about the high home prices?  Is new construction the best option for my needs?  Where are the best schools and recreation areas for my family?  How can I take advantage of the historically low interest rates?  Maybe I should consider a rental property for investment purposes?  Can I really keep my monthly payment lower than I imagine it might be?

And the list goes on.

My answers always begin with two important facts.  The first is that any answer to those questions needs to be personalized for each and every client.  After all, every family has its own individual needs, wants and budget and “one size fits all” just doesn’t cut it when it comes to one of the largest assets you will ever own.   As you might imagine, a home often represents about 90% of the total wealth of a household, so a home purchase decision is of considerable importance.

The second fact, which I cannot over-emphasize, is the importance of using a professional, knowledgeable and seasoned real estate professional like myself in trying to navigate today’s buying and selling market.  I’ve been in the local residential real estate arena going on 48 years now and have witnessed every type of market imaginable.  With my investment banking background and certification in negotiation, I do my best to make the entire process as stress free as possible.

That may seem like a given but believe me, in a market with so few available existing homes for sale it’s more prudent than ever to have a pro on your team.  Existing homes for sale are scarce and are selling as fast as they get listed—more often than not from 2 to 10% over the listing price and with bidding wars. 

Even newly constructed home buyers need assistance in order to get help with elevation and site selection, as well as direction to the financing that is the best fit for their particular situation.    

My long-time experience certainly gives you, my clients and readers, an advantage over many and my special brand of customer service is hard to beat. If it appears that something is not in your best interest, I will tell you that.  Oftentimes a “no” can be a win in the long run.  I’m in this for long-time relationships and will give you my honest opinion always.  It has been my greatest joy to be able to assist children and even grandchildren of previous clients who remember me from when I helped their parents buy or sell a home where they once lived.

If you’ve considered a move--even relocating to another city for a job transfer or to be near family members--or have any questions concerning residential real estate, there’s no better time than now to start the process.

I don’t always have all the answers, but lucky for you, I’m fortunate to know where to get them and sometimes that’s a true “win” for all.  

So, there you go.  You’ve got questions?  I’ve got answers. 

It all starts with a call to 593.1000 or email me at  Harry@HarrySalzman.com . The sooner you ask, the sooner you’ll know, and I think you’ll be happy at what we can accomplish together.  With today’s low interest rates, you might just find that you can easily afford more home than you would expect, and without increasing your monthly output by too much.  No one knows how long these rates will hold as they are beginning to inch up, but at present they are around 3% for a 30-year fixed-rate and 2 3/8% for a 15-year fixed-rate.  When we do the math, you will likely be pleasantly surprised at what you can afford at these rates.

I look forward to talking with you soon.

 

The Wall Street Journal printed three articles this past week that I found to be so pertinent to  many questions I’ve been asked that I thought I would quote from them here:

 

THIS HOUSING BOOM IS DIFFERENT 

The Wall Street Journal, 3.16.21

Today’s residential real estate boom is on its biggest tear since 2006, which was just before the housing bubble burst and set off a global recession.  However, in nearly every meaningful way, today’s market is the inverse of the previous boom.

In today’s market, mortgages are stricter, down payments are higher, and a tight supply is supporting price appreciation.  It’s far more stable than the last housing boom, and poses fewer systemic risks, economists say.  The one downside is that there are more barriers for entry, and it’s more difficult for buyers who aren’t already homeowners to make that first purchase.  

The recent pandemic helped ignite the current boom as a number of urbanites looked to leave crowded cities for cheaper cities or for more space in the suburbs while working from home.  Once the lockdowns began lifting last year, home sales took off and last June sales nationally surged 21% over the prior month, the biggest monthly increase on record going back to 1968.  That milestone lasted only one month, when July sales rose almost 25% from June.

Some of those who bought last year would likely have bought in the next few years anyway but accelerated their plans due to Covid-19.  That could possibly slow down the demand going forward. 

Economists also caution that the shortage of available homes for sale could limit the number of sales this year.  Homebuying demand is so high at present that many new homebuilders are limiting the number of homes they sell at a time to ensure they don’t sell more than they can build.  The rising cost of materials such as lumber, aluminum and copper are also creating higher prices on new homes being built.

However, market watchers are saying that a number of longer-term trends are at play that should keep the housing market hot, or at least steady, even after the pandemic related demand fades.

Millennials, the largest living adult generation, are entering their prime homebuying years and are putting down payments on homes.  Simultaneously, the market is critically undersupplied and new home construction has not kept up with the demand.  Homeowners are also holding on to their houses longer and buyers are competing fiercely for a limited number of homes.

Also different from the boom of 2006 is that mortgage lenders are maintaining tight standards and buyers are drawn to the market by the historically low interest rates, not by easy access to credit.  Rising home values also mean that even if homeowners can’t afford their mortgage payments, they can likely sell their homes for a profit rather than face foreclosure.  

Today’s biggest winners are those who already own their homes, who gained a collective $1.5 trillion in equity in 2020 from a year earlier, according to CoreLogic.  They have also saved money by refinancing their mortgages at record low rates and have started renovation projects or bought second homes.

These same folks are the ones who have plenty of equity to use toward new homes that have the living requirements many found lacking in their present homes during the lockdown.  

Put all together, these longer-term trends are at play and should keep the housing market hot for some time to come.

 

COMMODITIES BOOM HITS HOME / RISING COSTS ADD TO HOME PRICES

The Wall Street Journal, 3.17.21 & The Wall Street Journal, 3.18.21

Just when rock-bottom mortgage rates have made owning a home more affordable, the price of building materials have gone sky-high.

Lumber, one of the biggest costs in home-building after land and labor, has never been more expensive and is more than twice the typical price for this time of year.  Crude oil, a starting point for paint, drain pipe, roof shingles, and flooring, has shot up more than 80% since October.  Copper, which carries water and electricity throughout houses, costs about a third more than it did in the Fall.  

Prices for granite, insulation, concrete blocks and common brick have all pushed to records in 2021, according to the Bureau of Labor Statistic’s producer-price index, which measures the change that producers receive for their output.  Drywall and ceramic tiles are short of records but have also climbed.

What does all this mean?  For one, homebuilders were not prepared when buyers began looking in earnest last April.  With sawmills and factories shut down like most other workplaces, oil wells shut in and refineries idled, suppliers never had a chance to catch up. 

At present, building permits for residential construction are being issued at their highest rate since 2006 and the newest round of stimulus checks are arriving just in time for spring, when Americans tend to house hunt.  

The National Association of Home Builders says that rising lumber prices have added $24,000 to the cost of building the average single-family home and about $9,000 per apartment.  

What this translates to you is that if you’re in the market for new construction you may have to get in line and expect to pay more than you thought.  However, the sooner you begin the search the better off you will be since it’s likely that prices are only going one way for quite some time—and that way is UP.  

If new construction is something you have even considered, call me yesterday.  I can assist in all facets of it, and the time to begin is today!

 

FIRST-TIMERS OFTEN SHOCKED AT HOW MUCH HOME THEY CAN AFFORD

RealtorMag.com, 2.22.21

Many first-time homebuyers are finding that with assistance from parents and personal savings they are able to stretch their housing budget more than they thought possible, according to a recent survey from realtor.com.  More than two-thirds of respondents say they are surprised at what they can afford; 47% say their budget is larger than they thought it would be.

“The dramatic decline of mortgage rates in 2020 was a pleasant surprise for many buyers,” says George Ratiu, senior economist at realtor.com.  “For first-time buyers, the drop in the 30-year mortgage rate from 3.65% in March 2020 to a record low of 2.65% in January has provided unexpected leverage.  Lower rates allowed many buyers to stretch and buy more expensive homes while keeping their monthly budget the same.”

With a housing shortage nationwide, many first-time buyers are still having to compromise on recent purchases and nearly half of the survey respondents say they have been outbid on homes they wanted to purchase.  

However, first-time buyers are also saving for a home faster than they expected.  Half of the respondents say they were able to save for a home in less than three years by putting aside a portion of their paycheck each month, cutting out discretionary spending, and saving lump-sum payments like tax returns.  Also, many are getting help with down payments from their families or friends.  

Considering how high rental rates have gotten, if there is a way, first-time buyers will not only be saving on rental payments but will be building equity of their own.  

 

AND A THOUGHT FROM ELLIOT EISENBERG, THE BOWTIE ECONOMIST:

Domicile Deficit

“Existing inventory of residential homes is currently just 1.04 million units, or 1.9 months of supply, both record lows.  It is partly due to insufficient homebuilding over the past decade, Boomers aging in place, Covid-19 preventing sellers from listing, huge demand by buyers to escape dense cities and decamp to suburbia and more space, low interest rates, forbearance plans, and the seven million single-family homes that have become rentals.”

 

 

March 8, 2021

 

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.

 

 

IF I SOUND LIKE A BROKEN RECORD AT TIMES, IT’S ONLY BECAUSE I WANT TO PUT MORE MONEY IN YOUR POCKET…

As the saying goes, “Time is Money”, and in the case of Residential real estate that could not be more true.

You will see in the monthly statistics below that our local home appreciation is continuing its steady climb, and while it should slow down a bit when we have more available homes for sale, it’s not likely to stop its upward trend.

Mortgage rates, however, are slowing heading up, and while they are still historically low, no one knows how long they will remain at today’s rates.

Put those two things together and voila…there’s no better time than NOW to begin your residential real estate search if you’ve even considered a move or want to buy for the first time or for investment purposes.

Nationally, home ownership is on an upward trend and is likely to remain so for quite some time.  This has been driven by a number of factors such as Millennials wanting to settle down and raise families, folks discovering new wants and needs fueled by the current pandemic, and by rental prices rising so high that home ownership becomes a viable option for those who can make that happen.

We in Colorado Springs are witnessing a lot of new business growth, and with that comes relocated employees who are searching for places to live.  The arrival of Southwest Airlines who will begin flights out of COS this Wednesday is making it much easier for business and personal travel alike—helping folks avoid the long drive to DIA.  

The city’s economic strength is strong thanks to the foresight and planning of Mayor John Suthers and the Colorado Springs City Council as well as Dirk Draper, CEO of the Chamber & EDC and Doug Price, CEO of Visit Colorado Springs, among others. Those of us who live here are fortunate to have those folks working diligently to help our city remain on the “Top 10” lists such as Best Places to Live, Best Places for Small Business, Best Work/Life Balance and many more.

In fact, US News & World Report recently listed Colorado Springs as #4 in the most recent “Best Places to Live in the U.S.” 

The rankings were based on 150 metro areas in the United States as to the quality of life and job market in each area, as well as the value of living there and people’s desire to live there.

According to the article:

 “Colorado Springs’ construction is booming, with new residences popping up alongside quality schools, parks and cultural attractions.  This area, which is filled with natural wonders of its own, has the additional allure of proximity to ski resorts like Aspen and Vail without the associated steep costs of living and high levels of traffic.  And even though its quaint downtown might not have big name stores, Denver’s lineup of storefronts is just an hour’s drive away.”

The article went on to say:

“The overall cost of living in Colorado Springs is slightly more expensive compared with the national average, but residents spend slightly less than the average American for groceries, utilities and transportation.”

Rankings such at that, combined with new options of working from home (WFH) are contributing to the influx of folks wanting to relocate here.  Let’s face it, if you could choose to live most anywhere, Colorado Springs is pretty close to ideal.  We have it all, and like it or not, more and more people are choosing our city as their home as well.  

This brings me back to putting more money in your pocket.

Home appreciation is going to continue to rise and the cost of materials such as lumber, cement, copper and aluminum are rising faster than ever which is affecting not only new construction, but existing home renovations as well.  Mortgage rates aren’t going to remain historically low forever and rental prices will continue to rise due to the shortage of available homes for sale.

Fortunately for you, I’ve been in the local Residential real estate arena for just about 48 years now and I’ve seen most every cycle imaginable.  With a certification in Negotiation and a background in Investment Banking, I can help when it comes to getting you the best deal possible in today’s tough market.  And, if I think something really won’t work for your individual situation, I’ll be the first to tell you that, too.  I’m in business for long term relationships, not for a quick sale.  That’s why I so enjoy selling homes to the children and even grandchildren of former clients who I knew as children!

If you’ve considered a move, your present home is likely worth more than you might imagine, and you can use that equity toward a new home.  With the current low mortgage interest rates, you could possibly make that move without adding too much more to your monthly output.  

However, you won’t know any of this unless you ask.

And it all starts with a simple phone call to 593.1000 or an email to Harry@HarrySalzman.com to get the ball rolling.  Please call me even if you are considering a move…because you won’t know until you talk it through and see it on paper if this is the right time or right decision for your personal situation.  

I look forward to speaking with you soon.

 

And now for statistics…

 

FEBRUARY 2021

Statistics provided by the Pikes Peak REALTORS Service Corp., or it’s PPMLS

Here are some highlights from the February 2021 PPAR report.  Remember that the new format of this report no longer provides monthly statistics for each individual neighborhood.  However, if you are interested in what’s happening in your neighborhood, I can provide you with this information through other means.

In El Paso County, the average days on the market for single family/patio homes was a very low 15.  For condo/townhomes it was 9.  

Also in El Paso County, the sales price/list price for single family/patio homes was 102.3% and for condo/townhomes it was 103.1%.  

Since this is also year-end statistics, I am providing you with both the regularly posted year-over-year monthly stats as well as the cumulative year-to-date comparison of 2020 to 2019.  

Please click here to view the detailed 10-page report, including charts.  If you have any questions about the report or to find out how it relates to your individual situation, just give me a call.

 

In comparing February 2021 to February 2020 for All Homes in PPAR:                        

                        Single Family/Patio Homes:

·       New Listings were 1,349, Up 7.6%

·       Number of Sales were 981, Down 0.4%

·       Average Sales Price was $454,899, Up 17.6%

·       Median Sales Price was $403,000, Up 18.2%

·       Total Active Listings are 462, Down 57.4%

·       Months Supply is 0.5

 

Condo/Townhomes:

·       New Listings were 193, Down 9.8% 

·       Number of Sales were 160, Up 9.6%

·       Average Sales Price was $300,826, Up 18.2%

·       Median Sales Price was $295,050, Up 24.5%

·       Total Active Listings are 71, Down 36.6%

·       Months Supply is 0.4

 

Now a look at more statistics…

 

FEBRUARY 2021 MONTHLY INDICATORS AND LOCAL MARKET UPDATE ILLUSTRATE OUR LOCAL TRENDS IN DETAIL

Colorado Association of REALTORS^{® ,} Pikes Peak REALTORS Service Corp, or it’s PPMLS

Providing greater detail than the above report, this contains information on both El Paso and Teller counties for Residential real estate 

The “Activity Snapshot” for all residential properties in El Paso and Teller counties shows the Year to Date one-year change:

 

• Sold Listings for All Properties down 1.3%

 

• Median Sales Price for All Properties was Up 17.5%

 

• Active Listings on All Properties were Down 56.6%

 

You can click here to read the 16-page Monthly Indicators or click here to get specific information on the geographical area of your choice from the 18-page Local Market Update. I recommend that you check out your own area or one that you are considering, to get a good idea of the local pulse. As an example, here is a detailed report on the Colorado Springs area:

 

UCCS ECONOMIC FORUM DASHBOARD (and more!)

UCCS College of Business, updated 2.26.21

The UCCS 24^th Annual Economic Update was recently published, and I am reproducing just one page here for your perusal.  This is the Residential real estate Indicators and as always, I was one of the people contacted for my yearly forecast of the same.  Here is that report:

 

I also just received the most recent economic report from the UCCS Economic Forum.  It presents both the big picture of the US as well as our local economic trends. Please click here to see the 5-page report and if you have any questions about either this or the above forecast, please give me a call.

 

FEDERAL HOUSING FINANCE AGENCY (FHFA) JUST RELEASED THE FOURTH QUARTER 2020 RESULTS…AND COLORADO SPRINGS IS NUMBER 17 OUT OF THE TOP 100

FHFA , 2.23.21

The recently released report shows that U.S. home prices rose 10.8% over the last year and were up 3.8% in the fourth quarter.  According to Dr. Lynn Fisher, Deputy Director of FHFA’s Division of Research and Statistics, “House prices nationwide recorded the largest annual and quarterly increase in the history of the FHFA House Price Index (HPI).” 

“Low mortgage rates, pent up demand from homebuyers and a limited housing supply propelled every region of the country to experience faster growth in 2020 compared to a year ago despite the pandemic.  In particular, house prices in western states and cities saw the highest rates of growth, where annual gains often rose above 10%,” she added.

Some of the significant findings include:

• House prices have risen for 38 consecutive quarters, or since September 2011.
• House prices rose in all 50 states and the District of Columbia.
• Of the nine census divisions, the Mountain region experienced the strongest four-quarter appreciation, posting a 13.3% gain between the fourth quarters of 2019 and 2020 and a 4.6% increase in the fourth quarter of 2020.

Colorado Springs was ranked number 17 out of the top 100 cities in the survey.  Here is a look at how Colorado Springs performed:

 

I apologize for the poor reproduction, but it was the best I could do!  Once more, any questions, please give me a call.

 

COLORADO SPRINGS HOMEBUILDING ON A ROLL

The Gazette, 3.4.21

For the first time since April 2005, single-family homebuilding permits in El Paso County topped the 500-mark last month and there doesn’t appear to be an end in sight.

Some of this is of course due to the lack of available existing homes for sale, however there are numerous reasons—including the new wants and needs that folks discovered they had due to working from home, schooling from home, eating at home more often—and more.  Low mortgage interest rates and high rental rates undoubtedly also contributed to this increase. 

I’ve helped a number of my clients in recent months with the purchase of newly constructed homes.  When it comes to site and elevation selection, as well as finding the best mortgage for each individual situation, I’m the guy to see.  

My good working relationship with a number of local homebuilders is of great benefit to my clients—and did I mention that this comes at no additional cost to you?  Just one of the many services I provide to help make the entire process as stress free as possible.

If new home construction is in your future, or if you are looking to buy for investment purposes as several clients have recently done…just give me a call.  With the cost of building materials rising weekly, the sooner you lock in a price the better.

 

SO, THERE YOU HAVE IT…

I’ve given you a lot of information that, when considered, should get you thinking of what’s best for you in terms of residential real estate.

As I’ve always said, “Knowledge + Implementation = The Best Rate of Return.  And that’s what I get for my clients—The BEST rate of return possible.  

If you’re ready to talk, I’m ready to listen…and then to help you make all your residential real estate dreams come true.

 

FEATURED LISTING:

JUST SOLD MY LAST LISTING.  YOURS, HERE?  IT MOST CERTAINLY WILL GET A LOT OF ATTENTION—NOT ONLY FROM ME, BUT ALSO FROM MY READERS AND ANYONE LOOKING TO BUY.

 

February 22, 2021

 

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.

 

 

IF YOU’VE EVEN CONSIDERED A MOVE…NOW IS THE TIME

As the infographic above indicates, mortgage rates are lower than they have been in years.  What it doesn’t show you is that rates reversed course this past week and the 30-year fixed-rate mortgage increased to its highest point since mid-November.  

This recent increase is due to the U.S. economy improving and supply chain shortages causing downstream inflation.  I can’t tell you what’s going to happen even next week, but Freddie Mac chief economist Sam Khater is predicting rates to remain in the low 3 percent range for the year.  

I can tell you that the price of lumber has increased 49% in three weeks to more than double what it was a year ago.  Cement, copper and aluminum are also on the rise.  These costs will be passed on to new construction homebuyers just as quickly, and will then trickle into resales as well.

If you’ve been following my eNewsletters for any length of time you are acutely aware that the Colorado Springs area is similar to the country in general when it comes to the shortage of existing homes for sale. As of yesterday, locally we have a total of 453 single-family homes for sale and a total of 81 others in the condo, patio home and townhome category —in all price categories.  Not an easy situation for potential buyers. 

This, of course is driving up home appreciation and is resulting in bidding wars and offers considerably over list price on most homes—sometimes just hours after a home comes on the market.

It certainly presents some difficulties—especially for first-time buyers.  However, it is just as taxing for those who want to sell and trade up.

Fortunately, you have me.  My almost 48 years in the local residential real estate arena, along with my investment banking background and negotiation expertise gives me an advantage over many other real estate professionals.  And today it is more important than ever to engage a seasoned, knowledgeable professional when are ready to even consider entering the home buying and selling market.

 

• Is this the right time for you?  
• What are your specific wants, needs and budget? 
• Do you want new construction or are you looking for an existing home?  
• Do you have a lender who can provide what you need for your specific financial situation?  

 

These questions and many more need to be answered prior to the start of a home search and I am more than qualified to help you in finding the right answers.  

What I can answer for you right now is this—if you’ve even considered a move, now is the time to begin.  If you currently own a home, it’s likely got more equity than you might imagine.  And even with the slight increase, mortgage interest rates are still historically low.  Therefore, even with the increased home price tags it’s possible your monthly output could be the same or not too much more than it is at present.

Of course, you can’t get any of those answers by simply reading this eNewsletter.  Please give me a call at 593.1000 or email me at Harry@HarrySalzman.com and let’s put our heads together and get started.  

If you are looking to sell and trade up, purchase new construction or an investment property, or a first-time buyer wanting a starter home, contacting me is the first step in making all your residential real estate dreams come true.

 

ALL U.S. METRO AREAS SAW HOME PRICES RISE DURING FOURTH QUARTER 2020

NAR, 2.11.21

Every metro area tracked by the National Association of Realtors (NAR) through the fourth quarter 2020 experienced home price growth from a year ago, according to the latest NAR quarterly report.

Eighty-eight percent (161 areas) of the metros followed by NAR saw double-digit growth.  For comparison, in the third quarter 2020 only 115 metro areas saw such growth.  

According to Lawrence Yun, chief economist for NAR, “The fourth quarter of 2020 presented circumstances ripe for home price increases.  Mortgage rates reached record lows, thereby driving up the demand.”

“At the same time, inventory levels also reached record lows, leading to grim inventory conditions of insufficient supply in the fourth quarter,” he added.  “Although tourism took a major hit throughout 2020, our data shows that vacation housing still did well in terms of sales.  Many people purchased in these areas because they found themselves with new work-from-home freedoms.”

As you might have guessed, Colorado Springs was right up there—with a 15.2% increase in median existing-home prices in the fourth quarter 2020 over fourth quarter 2019.  

In terms of median home prices, Colorado Springs placed 31 out of the 183 Metropolitan Statistical Areas (MSAs) surveyed.  Our prices will continue to rise due in part to the lack of available homes for sale, the bidding wars and offers considerably over list price that we have witnessed in the past year.

The pandemic and work-from-home (WFH) opportunities are also bringing more and more folks to our city because of our notorious outdoor activity opportunities, more suburban space, and cleaner air.  As a longtime resident, at times I wish we could slow this down a bit, but I am aware that progress in this area won’t be slowing down any time soon.  I couldn’t imagine living anywhere else, and more and more folks are finding they feel the same.

If you are interested in seeing the entire NAR Fourth Quarter 2020 report in numerical order, please click here.  For an alphabetical listing, please click here.  And, for the first time, NAR has also published the report by “Qualifying Income Based on Sales of Existing Single-Family Homes’ for these same areas.  To view that, please click here. 

As always, if you have any questions, please give me a call.

 

COLORADO SPRINGS IS NUMBER 17 ON MILKEN INSTITUTES BEST-PERFOMING CITIES LIST

The Gazette, 1.19.21

Coming in at number 17 on the Milken Institutes, annual Best-Performing Cities list, Colorado Springs jumped 19 spots over last year.  This ranking is the city’s highest-reaching in the 22 years since the California-based think tank has been publishing these rankings.

This year the institute added factors in the ranking for housing affordability and household broadband access, which it said was “an effort to more effectively reflect the inclusiveness of local economies”.  The index also measures jobs, wages and high-tech growth.

Colorado Springs has continued to move up in the rankings—to 36^th last year from 58^th in 2018, and 90^th in 2017.

 

 

IT’S A SELLER’S MARKET AND BUYERS ARE SNATCHING UP NEW LISTINGS AS QUICKLY AS THEY’RE AVAILABLE

RealtorMag, 2.19.21

As I’ve been saying for over a year now, it’s going to stay a seller’s market until we have more homes for sale.  NAR chief economist Lawrence Yun recently said, “Home sales could easily be 20% higher if more homes were for sale”.

He added that “Home sales continued to ascend in the first month of the year, as buyers quickly snatched up virtually every new listing coming on the market”.  

I can attest to this and it’s one of the reasons I’ve suggested that if you have even thought about selling your home, NOW is the time.  You will get the best price ever and likely more than you might imagine.  It is certainly worth your time to give me a call and see how together we can find a way to upgrade your current living situation to fit your present needs and wants—and at these low interest rates your monthly output might not increase by as much as you think.

Here is a look at the key indicators from NAR’s national existing-home sales report, reflecting January sales data:  (for local information, please give me a call)

 

Home Prices:  The median existing-home price for all housing types in January was $303,900--a 14% jump over a year ago.

 

Inventory:  Total housing inventory at the end of January was 1.04 million units, down nearly 26% from a year ago.  Unsold inventory sits at a 1.9-month supply at the current sales pace.

 

Days on the Market:  Properties typically remained on the market for 21 days in January, down from 43 days a year prior.

 

First-time Buyers:  First-time buyers comprised 33% of sales in January, up slightly from 32% a year earlier.

 

As you might imagine, our local numbers are higher in the median price category and are mostly selling for over list price.  Again, please give me a call for further explanation.

 

 

 

February 7, 2021

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.

 

IT’S SUPERBOWL SUNDAY…

…and I thought I’d start your day with a “Super” eNewsletter from your “Super Realtor”—me!  In fact, I was again named to the National ERA 2020 “Leader’s Circle”, having demonstrated my super abilities in working with clients.  Please enjoy this eNewsletter…and then enjoy the SuperBowl later today.  Go Chiefs!  Go Bucs! (you didn’t think I’d show a preference for anyone but the Broncos, did you?)

 

 

 

THE SEARCH FOR HOMES CONTINUE…BUT YOU’VE GOT A SECRET WEAPON…AND I NEVER GIVE UP

You heard that one right!  It’s a tough out there in the residential real estate world but lucky for you, I’ve been wading through these home wars for almost 48 years and know the ins and outs of most all cycles. That, combined with my Investment Banking background, gives me a considerable heads up on the competition and helps me provide possible solutions that others may not know exist.  

Quite honestly, this cycle is unlike any we’ve historically seen, so working with a knowledgeable, professional and trustworthy real estate broker like myself is of utmost importance in making any and all of your residential real estate decisions.

As you will see in the statistics below, there is a record low of existing homes for sale in our area, and according to Lawrence Yun, chief economist for the National Association of REALTORS (NAR), things are not likely to change much in the coming year.  He is forecasting for the USA in general, and things here in Colorado Springs will not only mirror the rest of the country but will likely be even tighter as so many folks are wanting to relocate here. Like most things, it’s a matter of supply and demand and in this case, existing homes for sale cannot meet buyer demand.  It looks to be a seller’s market for some time to come.

With so few available homes for sale, when one comes on the market it often is under contract that same day, after bidding wars and at a cost considerably over list price.  I’ve seen as many as 43 offers on lower priced homes. Crazy world we live in and one that can make it hard to make a move for you and your family.  It’s especially hard for millennials and first-time buyers who don’t have the down payment or the credit history to qualify for those higher priced homes.

What to do?  Knowing what you want, need and can afford is the best place to start.  The fast-paced decision making today requires you to do some homework so you can move quickly when you find the “one” you want.  And oftentimes in today’s low interest environment, you can possible afford a higher priced home than you might imagine since the monthly payments at these low mortgage interest rates are keeping monthly costs in check while providing folks with more home for the money.  

Mortgages for home purchases across the country have reached record highs, but if you are a buyer in most any price range, don’t get too hung up on the price of a home—look at look at the actual out of pocket monthly costs to determine what you can afford.  

Colorado Springs-area homebuilding is the hottest it’s been since 2005 and this year is already off to a fast start.  A number of my clients have looked in that direction lately and I’ve been able to provide them with assistance in home and site selection as well as directed them to a lender that suits their individual situation.  These homes continue to rise in price as well due to the price of lumber and other materials. 

The importance of matching the right lender to the buyer cannot be over-emphasized.  Recently I had a client who I helped with the purchase of a newly constructed home.  The lender was specified by the builder and this created a number of problems for the buyer due to the lack of due diligence on the part of the lender.  This particular lender didn’t honor the performance dates in the sales contract, and it caused additional stress for my buyer, something I work hard to avoid whenever possible. 

And when it comes to new construction, I’ve been finding that there are a number of choices in most price ranges that can provide families just what they are looking to buy.  I’ve even had some investment clients purchase newly constructed home as rentals, because with low interest rates they are able to find renters who would much rather have a home than an apartment for the same amount of money and this can provide positive cash-flow in the right situation.

Any and all of these options are out there, and it can be tough to figure out the way to go.  That’s why you’ve got me.  Bring me all of your wishes, dreams, wants and needs, along with your budget requirements and let’s get to work.  Together we will get it done…and done right…for you and your family.

And it all starts with a simple phone call to 593.1000 or an email to Harry@HarrySalzman.com to get the ball rolling.  Please call me even if you are considering a move…because you won’t know until you talk it through and see it on paper if this is the right time or right decision for your personal situation.  

I look forward to seeing you soon.

And now for statistics…

 

JANUARY 2021

Statistics provided by the Pikes Peak REALTORS Service Corp., or it’s PPMLS

Here are some highlights from the January 2021 PPAR report.  Remember that the new format of this report no longer provides monthly statistics for each individual neighborhood.  However, if you are interested in what’s happening in your neighborhood, I can provide you with this information through other means.

In El Paso County, the average days on the market for single family/patio homes was a very low 15.  For condo/townhomes it was 8.  

Also in El Paso County, the sales price/list price for single family/patio homes was 101.7% and for condo/townhomes it was 101.8%.  

Since this is also year-end statistics, I am providing you with both the regularly posted year-over-year monthly stats as well as the cumulative year-to-date comparison of 2020 to 2019.  

Please click here to view the detailed 10-page report, including charts.  If you have any questions about the report or to find out how it relates to your individual situation, just give me a call.

 

In comparing January 2021 to January 2020 for All Homes in PPAR:

                       

                        Single Family/Patio Homes:

·       New Listings were 1,112, Down 16.6%

·       Number of Sales were 971, Up 6.0%

·       Average Sales Price was $433,581, Up 15.5%

·       Median Sales Price was $385,000, Up 14.3%

·       Total Active Listings are 460, Down 61.3%

·       Months Supply is 0.5, Down 10.2%

 

Condo/Townhomes:

·       New Listings were 160, Down 20.0% 

·       Number of Sales were 155, Up 14.0%

·       Average Sales Price was $285,746, Up 6.3%

·       Median Sales Price was $279,282, Up 15.2%

·       Total Active Listings are 64, Down 49.2%

·       Months Supply is 0.4, Down 3.5 %

Now a look at more statistics…

 

JANUARY 2021 MONTHLY INDICATORS AND LOCAL MARKET UPDATE ILLUSTRATE OUR LOCAL TRENDS IN DETAIL

Colorado Association of REALTORS^{® ,} Pikes Peak REALTORS Service Corp, or it’s PPMLS

Providing greater detail than the above report, this contains information on both El Paso and Teller counties for Residential real estate 

The “Activity Snapshot” for all residential properties in El Paso and Teller counties shows the Year to Date one-year change:

 

• Sold Listings for All Properties were Up 7.4%

 

• Median Sales Price for All Properties was Up 13.8%

 

• Active Listings on All Properties were Down 58.6%

 

You can click here to read the 16-page Monthly Indicators or click here to get specific information on the geographical area of your choice from the 18-page Local Market Update. I recommend that you check out your own area or one that you are considering, to get a good idea of the local pulse. As an example, here is a detailed report on the Colorado Springs area:

real estate IN 2020:  PLENTY OF REASONS FOR OPTIMISM

Realtormag, Jan-Feb 2021

I recently read an article by Lawrence Yun, chief economist for NAR, which I found to be enlightening as well and encouraging, so I wanted to share some insights with you.  I will quote some excerpts below:

“The housing market was a spectacular surprise in 2020—and the positive trend will continue this year.  Home sales in 2021 are expected to rise by around 10%.  Home prices will also climb, but I expect more moderate increases than we’ve seen, a break for first-time buyers.  Mortgage rates will continue to be favorable, staying at or near historic lows of 3% on average.  The labor market will strengthen, expecially as vaccines become widely available and life moves toward normal…

…Low mortgage rates have been the key reason for the housing market’s strong performance in the midst of the pandemic and high unemployment…. And while mortgage rates are highly influential, they’re not the only factor affecting home sales.  Given the substantial commitment and financial dollars at stake, consumer confidence and life-cycle events such as marriage, changes to family size, and retirement all play a role…

…Owners who were content with their home before the pandemic are thinking about the benefits of another bedroom to use as a dedicated home office or are considering relocating to the countryside, knowing that commuting to downtown offices every day has become a thing of the past.”

Mr. Yun shared a graph of his forecasts:

I’ve been acquainted with Mr. Yun and have found him to be “right on” when it comes to predicting real estate trends and forecasts.  I, too, believe that 2021 has the potential to be a wonderful year for residential real estate…as long as we get more homes on the market and get some of the pandemic restrictions behind us.  

 

UCCS ECONOMIC FORUM DASHBOARD

UCCS College of Business, updated 1.29.21

I just received the most recent economic report from the UCCS Economic Forum and wanted to share the statistics with you, as always.  It presents both the big picture of the US as well as our local economic trends.  trends.  Please click here to see the report and if you have any questions, please give me a call.

 

BUYERS MUST BE READY TO ACT QUICKLY

RealtorMag, 2.4.21

Once again, a reminder that in this fiercely competitive market with low inventories and escalating prices, it is essential to have answered all your questions concerning wants, needs and budget requirements.  Pre-approval as always, is imperative.  And tenacity is equally important.  It may take a while, but with me by your side you can know I will do my very best to keep the search as stress less as possible.  

Just remember—keep all your options open—and when you find what you want—there’s no time to “think about it”.  It’s most definitely one of those “if you snooze, you lose” kind of things.  I wish I could tell you differently, but please be forewarned.  

And don’t despair…we WILL find you what you want…it just might take a bit longer…or a few detours…to get there!

 

ON A SWEET ENDING NOTE…

 

January 25, 2021

 

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.

 

LOTS TO THINK ABOUT IN TODAY’S HOUSING ARENA

I’ve been a fixture in the local residential real estate community for going on 48 years now and have gone through a lot of different cycles, and this past year has certainly reconfirmed to me that change is not only inevitable…it’s a constant in the business of buying and selling homes.

The housing industry in general has been seeing new trends, most related to the current pandemic, and it appears that as we rethink the ways in which we work, live, educate and entertain, home needs and wants are also rethought.

As you might imagine, working from home (), home schooling and eating “in” more than in the past has created the need for more home office space, larger kitchens, more “privacy”, and greater outdoor entertainment areas.  Some folks have been busy with home renovations while others have been looking for properties to better suit their current needs and wants.

With record lows in existing homes listed for sale, home price appreciation is continuing its upward trend.  When coupled with the unimaginably low interest rates we are currently witnessing and rental prices also trending upward, it’s no surprise that homes are selling as soon as they hit the market—and creating bidding wars and selling prices considerably over listing price as well.  

What to do in this kind of market becomes the question if you are considering a move.  The answer is simple.  Call me!  For each individual situation—wants, needs, and budget—there is an personalized solution—and I am here to get you through the current residential real estate “maze”.  

Since it’s obviously still a seller’s market, one option is selling your present home and buying one that fits your needs today and for the foreseeable future.  As you might imagine, it’s imperative to know where you want to move because your present home will undoubtedly sell much quicker than you could even imagine.  Sometimes it’s possible to lease it back from the buyer until you are able to make your move, but that is not always an option.  Timing is everything when it comes to moving in today’s market.

New home construction was strong in 2020, looks to continue that way into the foreseeable future with new home prices continuing to rise as well.  This has been a viable option for a number of my clients and my good working relationship with a number of local homebuilders helps a lot. I can assist with site and home selection, as well as making certain that you can get the best financing to fit your individual needs.  

And speaking of new construction, this has also become an option for some of my “investor” clients who have faced the same lack of available homes for purchase as rental properties.  Let me give you a recent example of a home that in the past might not have been considered for a rental property.

My clients purchased a newly constructed home at a price of $507,000 with a down payment of 25%.  They were able to get an amazing 30-year fixed-rate mortgage (and non-owner occupied at that) for 2.75%.  They were also able to include landscaping front and back yards, rear fencing and window coverings in the loan amount.  That gave them a total monthly payment (PITI) of less than $2000.

Their property manager has indicated that the home should be able to rent for $2500-$2600 a month, thus giving them an immediate positive cash flow.  Of course, being a new home, they also have the reassurance of little or no maintenance for some years to come.

At this rental price point my clients should be able to find a great tenant who will not only take good care of the home but might choose to live there for a longer time period.  A win-win for all.

With many new companies moving to Colorado Springs, there are going to be lots of folks relocating and wanting a place to call home.  Most will be in the rental market until there are more homes for sale since new construction can’t happen overnight, and apartment living is not practical for some.  

Where is this narrative going?  

If you are looking to purchase a home for investment purposes, I’m your guy.  Not only do I put my own money where my mouth is and have owned investment properties for many, many years, I am able to help you figure out the best way for your situation.  However, since I do have an investment banking background, I am NOT a tax advisor.  So please know that you should always talk to your tax advisor prior to investing in residential real estate—or making any investment that could affect your individual tax situation.

For those of you with children or friends looking to buy for the first time, here’s an example of what happened to me just yesterday. A client was referred to me by her father.  She has always been a renter and wanted to buy but needed a starter home.  She was pre-approved for a loan up to $240,000, and as you might guess, that put her (and I) in an especially tough situation considering how few homes there are in general, let alone in that price range.  We looked at four homes and waited in line to even get in to see the homes.  After making an offer on a townhome listed at $185,000, I found out that we were offer number 43.  The accepted offer was $240,000, and although our offer was considerably over list price, we weren’t even in the ballpark.  

In cases such as these, sometimes it helps if a parent or other co-applicant can step up so that the buyer is able to qualify for homes in a higher price range.  Oftentimes the current rental payment of the potential buyer would allow them to buy more home for the money and not increase their monthly output, but on their own they might not qualify for the higher loan amount.

An important reminder:  No matter if you’re buying for you and your family or for investment purposes, don’t let the price point of a home get in the way of your decision.  The current low interest rates mean your monthly payment will likely be far less than you might imagine.

There you have it.  

While the market is tight and homes are not so easy to come by, I’m the guy who can steer you in the right direction to achieve your personal residential real estate needs and wants.  And it starts with a simple phone call.

I can be reached at 593.1000 or by email at Harry@HarrySalzman.com and I look forward to speaking with you. Remember—the sooner you contact me, the sooner you will be on your way to a new future in residential real estate. As the sign above my desk says, I’ll get it done:

And as my clients can attest…if it’s at all possible…I WILL get it done!

 

DECEMBER 2020 LOCAL MARKET UPDATE

Colorado Association of REALTORS^{® ,} Pikes Peak REALTORS Service Corp, or it’s PPMLS

Here is the December 2020 Local Market Update for both El Paso and Teller counties that wasn’t available when the last eNewsletter was published.  

You can click here to get specific information on the geographical area of your choice from the 18-page Local Market Update. I recommend that you check out your own area or one that you are considering, to get a good idea of the local pulse. As an example, here is a detailed report on the Colorado Springs area:

NOW MAY BE THE RIGHT TIME TO SELL YOUR HOUSE

Keeping current matters, 1.19.21

The housing market made an amazing recovery last year and is now positioned for an even stronger 2021.  Record low interest rates are definitely a driving factor and buyer demand across the USA is incredibly strong, and even more so in Colorado Springs.

I mentioned earlier, this is NOT the case on the supply side.  Here is a breakdown by states and you can see just how strong the demand is right here in Colorado:

 

 

As the maps show, buyer traffic is high, but seller traffic is low.  With so few homes for sale right now, record-low inventory is creating a mismatch between supply and demand.

What does all this mean for buyers and sellers?  

Buyers need to remain patient in the search process and be ready to act immediately once they find the right home since bidding wars and offers over list price are becoming the norm in this type of market.

Sellers may not want to wait until spring to put their houses on the market this year.  With such high buyer demand and such a low supply, now is the perfect time to sell a house on optimal terms.

Bottom Line?  If you’ve even considered a move, NOW is a great time to begin the process.  Call me today and let’s see how we can make your residential real estate dreams come true.

 

SOME REASONS WHY THE housing market IS SO TIGHT AT PRESENT

The Wall Street Journal, 1.22.21

The current shortage of available listings began more than a year ago and while it was not helped by the pandemic, there are a number reasons that have contributed to this.

Americans are staying in their homes longer than in the past, with the typical homeowner in 2020 having remained in place for 13 years.  This is in contrast to the 8.7 years that was typical in 2010.  About one in four U.S. homeowners have lived in the same home for more than 20 years according to a new study by Redfin Corporation.  

Homes sales across the country soared last year, reaching their highest level in 14 years, as Americans were looking for a larger home where they could work remotely more easily.  

But Covid-19 concerns had the opposite effect among potential sellers as a fear of strangers entering homes prompted some to cancel or delay plans to list their homes.

Others were concerned about finding a new home in a competitive market or refinanced at the considerably lower interest rates available.

Many baby boomers are staying in their homes and older folks are finding that they can “age in place” rather than move to “senior living” communities.  

All in all, this is creating not only the housing shortage, but contributing to the faster increase in home appreciation and resulting higher sales prices.

Once again…with feeling…if you are even simply dreaming of a new home—NOW is the time.  Waiting will cost you more in the long run and interest rates are not likely to remain this low forever.

 

2021’S SEVEN BIGGEST HOUSING ISSUES ACCORDING TO real estate PROS

Realtor Mag, 1.20.21

1. Inventory shortages.  Throughout the U.S. and most especially here in Colorado Springs.

 

2. Widely distributed vaccines to boost consumer confidence.  This should encourage more sellers to list their homes and help offset the inventory challenges.  It could also help businesses reopen fully and give more Americans added job security and the confidence to enter the housing market.

 

3. Some homes will be lost to foreclosure.  While there is likely to be an increase in foreclosures due to an end of forbearance and stimulus plans, growing home equity may help homeowners sell in a strong market if they are facing foreclosure.

 

4. Low mortgage rates will continue to drive demand.  The low interest rates are causing renters to speed up their plans to purchase a home, current homeowners are opting to trade up faster and older adults are downsizing sooner—all due to the low interest rates.  Mortgage rates will likely increase as soon as more people get the vaccine and the economy improves, so folks are wanting to take advantage of the low rates available now.

 

5. A permanent shift to remote work could encourage more moves.  Larger home offices and more private space will be a concern as many employers are considering at least a partial WFH situation for employees.  

 

6. Virus surges won’t lead to further market panic.  The surprise element of the pandemic has passed, and the real estate market is better prepared for virtual showings and are able to transact business while being socially distanced.  

 

7. Affordability challenges persist and tax credits may help.  As affordability issues mount, lawmakers are working to come up with solutions, most especially for first-time buyers.  The proposed $15,000 down payment tax credit for first-time buyers, which, as proposed, will be able to be used at the time of purchase, has been proposed as an extension of the Recovery Act’s temporary tax credit.

 

 

January 8, 2021

 

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.

 

 

HAPPY TO SAY GOODBYE 2020…

As we bid adieu to a very unprecedented year, here’s wishing you all a very happy 2021 along with hopes of a return to normalcy.  A new kind of normalcy, for sure, but any kind would be welcome at this point.

A year ago, I wrote about my “2020 Vision” and predicted that local home appreciation would remain high, new construction would become a viable choice for many, and interest rates appeared likely to remain low for the foreseeable future. 

All of this was true…and for many of the reasons I mentioned.  Those included the historically low inventory of existing homes for sale, the influx of new businesses and their relocated employees, and the high rental rates which would drive more folks to home ownership. 

I certainly didn’t have any clue that a world-wide pandemic was on the horizon and that it would have such an effect on the housing market.   For several months in 2020, Realtors were unable to show homes and even photograph ones that were going on the market.  A good number of homeowners were also hesitant to let strangers into their home during this time.  Therefore, my prediction that more homes would become available for sale did not come to fruition in 2020.

As a result of the pandemic, working from home (WFH) and home schooling have both changed what folks are looking for in their living situations and has driven a lot of home renovation and ideas of what is not only needed, but wanted, in a new home.  As you might imagine, larger kitchens, home offices, private spaces and outdoor entertainment areas are popular requests now.

And with WFH becoming so prevalent, there has been somewhat of an exodus from the bigger cities toward places with access to “the great outdoors”.  As most of you know, Colorado Springs most certainly has that…and so much more. 

This has put even more pressure on buyers and there have been times where I’ve made an offer for a client only to find out that there were 14 others in line!  Even though “Mr. Negotiator” is one of my aliases, there is a limit to even what I can do in a situation such as that.  So “going, going, gone” also applies to just how fast home sales are in today’s market.

To give you an example, as I write this there are currently only 322 existing single-family homes available for sale in the city of Colorado Springs. New listings are disappearing as quickly as they come on the market and this covers all price ranges. 

Homes across the U.S. appreciated in 2020 at the fastest rate since 2014 and until there are more existing homes for sale it’s likely that trend will continue throughout 2021.  Interest rates remain historically low, another driver of potential sales. 

New home construction was strong in 2020, looks to continue that way into the foreseeable future and new home prices are continuing to rise as well.  This was an option for many of my clients last year and continues to remain so at the start of 2021.  I’ve got a good working relationship with a number of local homebuilders, and that can help a lot. I can assist with site and home selection, as well as making certain that you can get the best financing to fit your individual needs.  And, of course, this comes at no additional cost to you.  It’s an excellent option for this coming year, especially with the list of new wants and needs. Your present home will no doubt sell quickly, and you could possibly lease it back from the buyer while your new home is being built.  Lots of things to consider for sure.

Millennials are finally looking at homeownership and unfortunately are also faced with the same limited options.  They are finding Colorado Springs a great place to call home and to begin raising families and interest rates are very favorable, but they too are being held back due to the listing shortage.

Home sales across the U.S. actually declined in November for the first time in six months due to an abundance of buyers and not enough sellers. 

See a theme here?  If you’ve even considered selling your present home, NOW is the perfect time.  You’ve probably got more equity than you might imagine and when coupled with the low interest rates—it might just make sense for you to make a move now--and most likely you can ‘trade up”.  As I tell my clients, it’s the monthly payments that you need to consider, not the price of the new home.  At today’s interest rates it’s possible that you can get “more” or a different home for not much more than you currently pay.

I’m guessing that when more people are vaccinated and feel better about venturing a bit further than home, more of them will be listing their present home in search of new environs.  This will help stabilize the escalating sales prices and help us return to more realistic home appreciation rates.  As you will see below, our average sales price for single-family homes in December 2020 was $437,365—a 20% increase over the price in December 2019!

Yes, times are a bit challenging for Residential real estate, but if you know me at all—you know I relish a good challenge.  I’ve been in the local real estate arena for almost 48 years and have been around for all the cycles.  I know that ins and outs of doing whatever it takes for find solutions for most any of these challenges and my investment banking background gives me a heads up on the competition. 

I work with each client to determine their individual needs, wants and budget and work to make things happen.  If something is not in your best interest, I’ll tell you so.  I’m in this business for long term relationships with my clients, not a quick sale. It’s been my pleasure to recently have worked with children and grandchildren of my past clients and I hope to continue that legacy.

A new year brings with it a lot of new hopes and dreams, and this year even more so than most.   If Residential real estate is among your hopes and dreams for 2021, please give me a call at 593.1000 or email me at Harry@HarrySalzman.com and let me help make them all come true.

And now for statistics…

 

DECEMBER 2020

Statistics provided by the Pikes Peak REALTORS Service Corp., or it’s PPMLS

Here are some highlights from the December 2020 PPAR report.  Remember that the new format of this report no longer provides monthly statistics for each individual neighborhood.  However, if you are interested in what’s happening in your neighborhood, I can provide you with this information through other means.

In El Paso County, the average days on the market for single family/patio homes was a very low 16.  For condo/townhomes it was 10. 

Also in El Paso County, the sales price/list price for single family/patio homes was 101.3% and for condo/townhomes it was 98.4%. 

Since this is also year-end statistics, I am providing you with both the regularly posted year-over-year monthly stats as well as the cumulative year-to-date comparison of 2020 to 2019. 

Please click here to view the detailed 10-page report, including charts.  If you have any questions about the report or to find out how it relates to your individual situation, just give me a call.

 

In comparing December 2020 to December 2019 for All Homes in PPAR:                      

                        Single Family/Patio Homes:

·       New Listings were 939, Up 14.2%

·       Number of Sales were 1,376, Up 10.3%

·       Average Sales Price was $437,365, Up 20%

·       Median Sales Price was $379,999, Up 15.2%

·       Total Active Listings are 532, Down 59.1%

·       Months Supply is 0.4, Down 5.7%

 

Condo/Townhomes:

·       New Listings were 161, Up 33.1%

·       Number of Sales were 222, Up 29.1%

·       Average Sales Price was $295,153, Up 18.3%

·       Median Sales Price was $290,000, Up 21.4%

·       Total Active Listings are 70, Down 46.6%

·       Months Supply is 0.3, Down 1.6%

 

The Cumulative YTD Summary: (comparing Jan-Dec 2020 to Jan-Dec 2019)

                        Single Family/Patio Homes:

• New Listings were 18,747, Down 1.0%
• Sales were 17,337, Up 8.0%
• Average Sales Price was $415,329, Up 13.4%
• Volume was $7,200,558,873, Up 22.4%

 

Condo/Townhomes:

• New Listings were 2,720, Up 10.8%
• Sales were 2,517, Up 12.8%
• Average Sales Price was $273,427, Up 10.3%
• Volume was $688,215,759, Up 24.4%

 

Now a look at more statistics…

 

DECEMBER 2020 MONTHLY INDICATORS  ILLUSTRATE OUR LOCAL TRENDS IN DETAIL

Colorado Association of REALTORS^{® ,} Pikes Peak REALTORS Service Corp, or it’s PPMLS

Providing greater detail than the above report, this contains information on both El Paso and Teller counties for Residential real estate.  I normally include the Local Market Update as well, but it was not available at press time. 

The “Activity Snapshot” for all residential properties in El Paso and Teller counties shows the Year to Date one-year change:

• Sold Listings for All Properties were Up 10.7%
• Median Sales Price for All Properties was Up 15.6%
• Active Listings on All Properties were Down 56.7%

You can click here to read the 16-page Monthly Indicators.

 

housing market FORECAST FOR 2021

Keeping current matters, 12.18.20

As you read earlier, the housing market, while facing its fair share of ups and downs in 2020, not only met expert predictions, it surpassed them and broke records along the way.

Here’s what leading real estate experts around the country are predicting for 2021: 

 

• Interest rates are projected to stay low.  This was one of the biggest drivers for 2020 and should continue in 2021.  Because of this, affordability reached one of the highest levels it has in the last 30 years.  And while home prices continue to rise, in part from lack of inventory, the counter of low interest rates have made purchasing a home increasingly affordable, especially for first-time buyers.  This infographic illustrates home affordability:

 

 

• Home sales are projected to grow by 7%.  This indicates that experts believe we will likely see an increase in inventory for 2021.  Whether it’s homeowners who waited out the pandemic or newly constructed homes, more inventory will be a welcome change.

 

• Home prices are projected to appreciate by 3.4%.  That’s a simple case of supply and demand.  But while 2020 saw homes appreciate on average nationwide at around 7 percent, this continued but lower appreciation is reflective of a more balanced market. With the end of the pandemic in sight, experts expect inventory levels to rise and home prices to appreciate at a steadier pace.

 

• Foreclosures should not lead to price declines.  Due to the massive wave of unemployment, a number of homeowners across the country were led to enter mortgage forbearance.  And while unemployment is slowly but surely declining (and ahead of expectations) it will be a while before we reach the pre-COVID levels.   Hence, foreclosures are expected to rise.  Experts do not anticipate this leading to a crisis like we saw in 2008 and they don’t expect it to lead to the major home value depreciation that followed.  According to Lawrence Yun, NAR chief economist:

 

And one more infographic on the 2021 Housing Forecast: (just a reminder that all of these are NATIONAL forecasts, and I expect our local numbers will be considerably better.  Please contact me for a more localized forecast)

 

 

NOTES FROM A ZOOM CONFERENCE

Like most people these days, I’ve been attending scheduled conferences via Zoom rather than in person. I thought I’d share some highlights of these meetings that you might find helpful.

The keynote speaker at the first conference on December 10^th was Lawrence Yun, chief economist for NAR.  Here are some of his “crystal ball” comments:

• After the widespread availability of the vaccine, we should see a fabulous increase in the economy which will lead to housing “wealth”
• Home sales are surging—both new and existing homes, but the record low supply is a challenge to affordability
• Home prices will be up 8% in 2021, in part due to the cost of lumber and new construction costs
• Mortgage rates will continue to be affordable
• The rate of return will remain positive for those who purchase for investment (rentals)
• Working from home will become the norm for many, with some going to the office no more than 1-2 days a week

 

And then from an economic panel of experts:

• A lot of “what if’s” will all turn positive
• Housing will be the best investment and rate of return for many
• Prices will be a detriment to first time buyers
• GDP growth should be around 3.5% in 2021
• Earnings growth in 2021 should also be good
• Inflation should be less then 2%.
• Much mobility will be on hold
• Optimistic that the economy will go up very strong
• housing market will see more inventory when people feel better about the pandemic (more vaccinations)

 

And some other thoughts:

• Developers are buying as much raw land as they can now
• The Housing Economy is at an all-time high and should continue
• Builders are selling more than they can build and are raising prices month after month
• For first-time buyers, the cost is getting in the door vs. the monthly payment

 

I’ll share some more conference material in the next e-Newsletter.

Until then…I hope to see or hear from you soon.

December 8, 2020

 

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.

 

*** Be sure to look in your inbox tomorrow for a “Special Edition” I think you’ll enjoy.  I was interviewed by the Global TV Talk Show, based in San Diego, CA for my expert advice in relocation, and more specifically, about the status of residential home sales in Colorado Springs and I wanted to share the video first with you, my clients and friends. Also included is a brand-new video from the Colorado Springs Chamber.  I believe you’ll find it worthwhile and interesting to watch. *** 

 

 

IT SEEMS LIKE 2020 JUST KEEPS GOING ON AND ON AND ON WHEN RECENT YEARS HAVE GONE BY IN A HEARTBEAT.  

The housing market, on the other hand, is moving faster and faster in a positive direction and continues to be the bright spot in the U.S. economy.

Homes sales across the U.S. have skyrocketed to a 14-year high, and there’s no apparent end in sight.  Folks are taking a look at their present living conditions in a way they might never have prior to the pandemic.  Working from home (WFH) coupled with more home schooling and most definitely more home cooking and entertainment is driving new wants and needs that many never considered before. When you add the historically low interest rates into the mix…it’s keeping both buyers and sellers quite busy.  

Another consequence of the pandemic is that buyers are wanting to relocate to cities such as Colorado Springs because of the proximity to outdoor activities and more of a suburban type of environment.  Getting out of busy cities is becoming a priority, especially for those who now WFH and can do so most anywhere.  And let’s face it, those of us who presently live here know exactly why companies and their employees want to move here.  After all, we aren’t called “America The Beautiful City” for nothing.

These factors are what’s driven the Colorado Springs area to a 25-year low in availability of existing homes for sale.  As of yesterday, there was a total of 749 homes for sale in all categories—single-family, patio homes, townhomes and condos.   

Available homes are selling at a premium—most over listing price—and bidding wars continue to be the norm.  It’s definitely a seller’s market and will continue that way until there is greater inventory.  

This is also the reason that home price appreciation continues its unrealistic surge and that in itself is causing concern for some first-time buyers who, despite the low interest rates, can’t qualify or afford to buy at present.

Most interesting is that this is traditionally a slower time of year for home sales and that is certainly not the case this year.  As you will see, single-family/patio home sales for November were up 24.7% over the same time last year and condo/townhomes were up 37.6%.  

If you’ve even considered a move, now is a good time to check out the possibilities.  While it might take a while to find your next home, you might consider the possibility of leasing back your present one while you complete the process of buying the next one.  This is not always a possibility, but it’s one you can certainly request when we list your home.

Something for present homeowners to remember is that the equity in your present home is potentially greater than you might think, and with interest rates so low, it’s possible you can get into another home for not much more in monthly payment costs.

New home construction is a more viable option than in past years and new homes sales across the U.S. are 41.5% higher than a year ago, most likely due to the low number of available homes for sale most everywhere in the country.

I’ve helped a number of clients in their new home purchases recently.  My good relationships with a number of local builders has given my clients an advantage.  I can help with site and home selection and even direct folks to the best lender for their individual situation.  And did I mention this comes at no additional cost to the buyers?  Just one of the many things I provide as part of my special brand of customer service.

I have been in the local residential real estate arena for more than 47 years, and with my investment banking background to boot, can help you make all your residential real estate dreams come true. 

It all starts with a call to me at 593.1000 or an email to Harry@HarrySalzman.com and we can get the ball rolling.  The sooner you begin, the sooner you’ll be living in the home that can provide you with the comfort and security you want, need and deserve.

 

And now for statistics…still “off the chart” but lack of listings is troubling…

As I just mentioned, you will see that home prices are continuing their upward trend due in part to low interest rates, low inventory and a pent-up demand created by the pandemic.

 

NOVEMBER 2020 

Statistics provided by the Pikes Peak REALTORS Service Corp., or it’s PPMLS

Here are some highlights from the November 2020 PPAR report.  Remember that the new format of this report no longer provides monthly statistics for each individual neighborhood.  However, if you are interested in what’s happening in your neighborhood, I can provide you with this information through other means.

In El Paso County, the average days on the market for single family/patio homes was 18.  For condo/townhomes it was 16.  

Also in El Paso County, the sales price/list price for single family/patio homes was 101.1% and for condo/townhomes was also 101.1%. 

Please click here to view the detailed 10 -page report, including charts.  If you have any questions about the report or to find out how it relates to your individual situation, just give me a call.

 

In comparing November 2020 to November 2019 for All Homes in PPAR:                       

                        Single Family/Patio Homes:

·       New Listings were 1,102, Down 1.9%

·       Number of Sales were 1,482, Up 24.7%

·       Average Sales Price was $429,163, Up 17.5%

·       Median Sales Price was $380,000, Up 16.9%

·       Total Active Listings are 675, Down 59.5%

·       Months Supply is .05, Down 2.4%

 

Condo/Townhomes:

·       New Listings were 166, Up 10.7% 

·       Number of Sales were 238, Up 37.6%

·       Average Sales Price was $275,411, Up 10.9%

·       Median Sales Price was $263,100, Up 14.4%

·       Total Active Listings are 77, Down 49.3%

·       Months Supply is 0.43, Down 1.3%

And a look at more statistics…

 

November 2020  LOCAL MARKET UPDATE  AND  MONTHLY INDICATORS  ILLUSTRATE OUR LOCAL TRENDS IN DETAIL

Colorado Association of REALTORS^{® ,} Pikes Peak REALTORS Service Corp, or it’s PPMLS

Providing greater detail than the above report, this contains information on both El Paso and Teller counties for residential real estate. 

It is broken down by geographical areas and you can look to see how your neighborhood is doing in terms of sales, prices, and more.  

The “Activity Snapshot” for all residential properties in El Paso and Teller counties shows the Year to Date one-year change:

• Sold Listings for All Properties were Up 25.5%
• Median Sales Price for All Properties was Up 17.1%
• Active Listings on All Properties were Down 59.7%

You can click here to read the 16-page Monthly Indicators or click here to get specific information on the geographical area of your choice from the 14-page Local Market Update. I recommend that you check out your own area or one that you are considering, to get a good idea of the local pulse. As an example, here is a detailed report on El Paso county:

 

REALTOR.COM HOUSING FORECAST:  SELLERS TO MAINTAIN THE MARKET ADVANTAGE

Rismedia.com 12.2.20

In its recently released 2021 Housing Forecast realtor.com predicted that inventory will make a slow and steady comeback, providing buyers with much-needed relief.  That said, they also predicted that increasing interest rates and prices will continue to pose a challenge on affordability throughout the year.  

 

 

The Forecast Breakdown:

Mortgage Rates:  Up to 3.4 percent by year-end

Existing-Home Median Price Appreciation:  + 5.7 percent

Single-Family Home Housing Starts:  +7.0 percent

Homeownership Rate:  65.9 percent

 

Key Housing Trends, according to realtor.com:

-Millennials continue to drive the market while Gen-Z become market players

-Affordability becomes a growing obstacle

-Inventory starts slow road to recovery

-Suburbs to shine if remote work stays around

 

A couple of elements could impact these forecast trends, however.  According to the report, if COVID-19 continues to bring lockdowns and quarantines, that could “put a dent in housing inventory and sales, slowing the market and putting increased pressure on buyers.”  But if a vaccine is rolled out quickly, homes sales, prices and inventory could be stronger than predicted.

 

U.S. HOME PRICES UP 7.8% OVER LAST YEAR:  COLORADO SPRINGS UP 11.3%

The Federal Housing Finance Agency recently published their House Price Index for Quarter 3 and needless to say…it was great news for homeowners.

“House prices recorded their strongest gain in the history of the FHFA HPI purchase-only series in the third quarter of 2020,” said Dr. Lynn Fisher, Deputy Director of the Division of Research and Statistics at FHFA.  “Relative to a year ago, prices were up 7.8 percent during the quarter—the fastest year-over-year rate of appreciation since 2006.  Monthly data indicate that prices continued to accelerate during the quarter, reaching 9.1 percent in September, as demand continues to outpace the supply of homes available for sale.”

 

Colorado Springs was #5 out of the top 100 metro areas:

If you wish to see the full list of 100 metro areas to see their rate of appreciation, both year-over-year and quarter-over-quarter, please click here.

 

MAXIMUM LOAN AMOUNTS RAISED FOR 2021

The maximum loan amounts for 2021 were raised 7 ½ %-- from $510,400 to $548,250 for conventional loans.  Any loan amount over that will be considered a Jumbo loan.

FHA loans will top out at $356,362 in 2021.

If you have any questions, please give me a call.

November 19, 2020

 

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.

 

 

CONGRATULATIONS TO ALL HOMEOWNERS IN THE COLORADO SPRINGS AREA…BUT REMEMBER…EVERYTHING COMES WITH A PRICE

A recent report from the National Association of Realtors (NAR) concerning Home Buyers by Metropolitan Statistical Area (MSA) shows that Colorado Springs is the number one city with the highest concentration of buyers.

Good News?  Well, in some ways, yes.  And in others, maybe not so much.

It’s certainly great for all current homeowners because obviously, greater demand is creating higher home appreciation.  However, a little slower appreciation would be more realistic, as I’ve been saying for quite some time now.  

For first-time homebuyers and those looking to relocate here for professional or personal reasons, it’s not quite as welcome news.

Like the rest of the country, the Colorado Springs area has been faced with a shortage of available homes for sale, and in our case, we have the lowest number of existing homes for sale ever.  This shortage is one of the factors in the unrealistically high home appreciation which will likely continue until there are more homes for sale.

Our once comparatively “quiet” city is growing by leaps and bounds and there’s no end in sight.  Companies are realizing the “work-life balance” is importance for today’s employees and their families, and this pandemic has driven that fact home even harder.

If you are able to work from home (WFH), wouldn’t you rather be in Colorado Springs than in some crowded city?  A rhetorical question to be sure, however, one that obviously many folks across the nation are asking themselves. 

The current pandemic has also forced folks into rethinking home “need and want “priorities and many are looking to add larger kitchens, quiet office space, home schooling and outdoor recreational and dining areas. 

Our downtown is thriving with the opening of the U S. Olympic and Paralympic Museum, numerous new apartment complexes, the new sports complex currently under construction, and more.  Hopefully it won’t be too long before we can put some of the restrictions due to COVID-19 behind us and restaurants and stores will be thriving again as well.  

Southwest Airlines has just added Colorado Springs as one of their destination cities and that promises to bring even more vacation travelers to our locale, as well as increasing traffic to and from COS.

Mayor John Suthers, along with the City Council and Chamber/EDC and others have worked so hard to see these dreams become realities and a big shout out goes to all concerned.  There was a time in the not-so-distant past when none of these things seemed possible, and certainly not in the time frame in which they have.   

If you’ve even thought about selling to trade up or move to a new neighborhood, NOW is the time.  It will likely take a bit longer to find what you want, and you may want to consider new construction as a viable option as well.  This is something a number of my clients have looked at in recent times and I’ve helped them find just the right solution for their individual situation.  

This is all part of my special brand of customer service and help with new home construction options comes at no additional cost to you.  In fact, it could save you money in the long run since I can not only help in site and home selection, but also in finding the right lender for you.  

Homes are not likely to get any cheaper, interest rates are still historically low and the equity in your present home is likely more than you might imagine—so don’t delay.  Give me a call at 593.1000 or email me at Harry@HarrySalzman.com and together we can make all your residential real estate dreams come true.

 

METRO HOME PRICES INCREASE IN ALL AREAS IN THIRD QUARTER 2020

Realtor Mag, 11.12.20

Just like we are seeing in the local statistics, home prices all across the country are seeing greater gains due to the limited number of homes for sale, record low interest rates and high buyer demand.  The majority of major metro markets posted double-digit price gains in the third quarter and single-family existing home prices increased in all 181 metro areas tracked in NAR’s latest quarterly report.

According to Lawrence Yun, NAR’s chief economist, “Favorable mortgage rates continue to bring fresh buyers to the market.  However, the affordability situation will not improve even with low interest rates because housing prices are increasing much too fast.”

He added that, “In light of the pandemic, prices jumped in a number of metros that contain larger properties and open space—where families could find extra rooms, including areas for an at-home office”.

Colorado Springs ranked 28^th with a 13.6% increase, in comparison with the U.S. as a whole at 12.%.  

Click here to see the entire list of 181 MSAs in numerical order or to view them in alphabetical order, click here.  If you have any questions, please give me a call.

 

FOUR REASONS WHY THE ELECTION WON’T DAMPEN THE housing market

Keeping Current Matters, 11.2.20

Interestingly enough, I read this article the day before the election and here we are two weeks out and we still don’t have the final results.  However, the thoughts concerning the housing market aren’t likely to change—the housing market has been and will continue to be—the driving force in the U.S. economy.

Here are four reasons why:

1. Demand is Strong Among Millennials.  The national’s largest generation began entering the housing market last year as they reached the age to marry and have children—two key drivers of homeownership.  According to an article in The Wall Street Journal, “Millennials, long viewed as perennial home renters who were reluctant or unable to buy, are now emerging as a driving force in the U.S. housing market’s recent recovery.”

 

2. Mortgage Rates Are Historically Low.  Rates are driving demand across all generations.  Strong demand created by this low rate has countered other economic disruptions (i.e. the pandemic, recession, record unemployment.)  Freddie Mac has forecasted mortgage rates to remain low through next year: “One of the main drivers of the strong housing recovery is historically low mortgage rates…Given weakness in the broader economy, the Federal Reserve’s signal that its policy rate will remain low until inflation picks up, and no signs of inflation, we forecast mortgage rates to remain flat over the next year.  From the third quarter of 2020 through the end of 2021, we forecast mortgage rates to remain unchanged at 3%.”

 

3. Prices Continue to Appreciate.  The continued lack of supply of existing homes for sale, along with buyer demand has experts forecasting strong price appreciation over the next twelve months.

 

4. History Says So.  Normally the market slows slightly in November when it’s a Presidential election year, and the pace quickly returns.  Here’s an explanation as to why from the Homebuilding Industry Report: “This may indicate that potential homebuyers may become more cautious in the face of national elections uncertainty.  This caution is temporary and ultimately results in deferred sales, as the economy, jobs, interest rates and consumer confidence all have far more meaningful roles in the home purchase decision than a Presidential election result in the months that follow.”  

 

Ali Wolf, chief economist for Meyers Research, also notes: “History suggests that the slowdown is largely concentrated in the month of November.  In fact, the year after a presidential election is the best of the four-year cycle.  This suggests that demand for new housing is not lost because of election uncertainty, rather it gets pushed out to the following year as long as the economy stays on track.”

 

Bottom Line:  There’s no question that this has been one of the most contentious presidential elections in our nation’s history and will have a major impact on many sectors of the economy.  However, as Matthew Speakman, an economist at Zillow explained several weeks ago:

“While the path of the overall economy is likely to be most directly dictated by coronavirus-related and political developments in the coming months, recent trends suggest that the housing market—which has basically withstood every pandemic-related challenge to this point—will continue its strong momentum in the months to come.”

 

So…once more with feeling…if you’re in the market…give me a call sooner than later.

 

METRO AREA WEALTH GAINS FROM HOMEOWNERSHIP AS OF 2020 Q2

National Association of Realtors, 10.30.20

Homeownership is the key to building wealth.  Among all families, the ownership of a primary residence typically accounts for 90% of total wealth, based on the 2019 Survey of Consumer Finance data.  Among those in the bottom 20% of the income percentile, the median value of holdings for a primary residence accounts for 99% of total family assets, but only 42% for families in the top 10% of the income bracket.

 

 

Housing wealth accumulation takes take and is built up by paying off mortgage debt and by home price appreciation.  And while home prices can fall, they tend to recover and go up over the longer term.  As of September 2020, the median sales price of existing home sales in the U.S. was $311,800, a 35% gain since July 2006, when prices peaked at $230,000.

Nationally, a person who bought a typical home 30 years ago would have typically gained about $283,000 as of the second quarter of 2020.  Of the total wealth gain, 67% is from the price appreciation of 3.7% annually.  Over a 10-year period, the wealth accumulation is $144,490, of which $114,233 or 80% are from the price appreciation.

Once again…homeowners accrue housing wealth or equity over time from the principal payments to reduce the mortgage debt and from the appreciation of home prices:

Housing Wealth Gains = Principal Payments + Price Appreciation Gains

 

Here is a look at Wealth Gains from Homeownership in Colorado Springs:

 

Note:  The calculations show the housing wealth gains accumulated for a typical home purchased 5, 10 and 15 years ago and sold at the median sales price as of 2020 Q2.  The calculations assume a 30-year fixed mortgage plus points and fees and 10% down payment.

These calculations are illustrative of the wealth gains from homeownership in Colorado Springs.  The actual home equity gains accrued over time will vary by property and will depend on home improvements undertaken over time.  These home improvement costs are not taken into account in the calculations.

 

 

                      

 

 

As you can see, these charts illustrate what I’ve been telling you time and again for many, many years.  Homeownership over time far outshines gains from traditional stocks and bonds while providing you shelter and comfort along the way.

If you have any questions, please give me a holler.  

 

November 5, 2020

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.

 

THE ONE CONSTANT IN THIS NOT-SO-NORMAL ECONOMY AND WORLD?  HOMEOWNERSHIP.

I was waiting to write this AFTER the Presidential election but since the results aren’t final at this time I didn’t want to prolong giving you great news regarding the state of residential real estate. 

With “home” taking on so many new meanings and functions, the housing market is playing a leading role in the present economic turnaround.  Many folks are buying or selling much sooner than they anticipated as they search for more functionality and personal comfort in their homes.  

High buyer demand and low inventory are causing homes to appreciate at a faster-than-normal pace.  According to the National Association of Realtors (NAR), the real estate industry provided $3.7 billion dollars of economic impact to the country last year.  This is significant in terms of the national economy as well as to the bottom line of current homeowners.

U.S. home prices between July and August 2020 showed a largest increase since the Federal Housing Finance Agency (FHFA) started the House Price Index in 1991.

As most of you know, homeownership is something I advocate for anyone who is in a position to do so.  And this is not just because I work in the industry.  I have invested in real estate since I purchased my first home in 1972 (even at an 8.5% mortgage loan rate!) and it has proven time and again to be a great investment.  The personal economic gains over the long haul have consistently outperformed stocks and bonds and the equity gains have allowed me to purchase other homes while keeping my bottom line in check.  

COVID-19 has contributed greatly to the lack of inventory in the Colorado Springs area for a number of reasons.  As mentioned earlier, folks who are working from home (WFH) and homeschooling their kids are finding new wants and needs for their housing situations.  And, WFH is also affording a number of those who live in crowded cities the opportunity to move to a more favorable environment such as ours.

According to a new survey from online freelance company Upwork, as many as 23 million Americans plan to relocate to a new city due to WFH.  

I’ve had more relocation calls in the last few months than I had all last year from those wanting to move here, and let’s face it…why not move to “America the Beautiful City” if that’s an option?  We get it.  However, that is another factor contributing the 25-year low availability of existing homes for sale here. 

As you will see, our median home prices are still on the rise, and I’m afraid that will continue until we have more listings.  Yes, rising median home prices are great, but this kind of rate is not sustainable, nor is it practical.  It is particularly hard on first time homebuyers who do not have equity to use and have trouble qualifying for the higher loan amounts.

Something for present homeowners to remember is that the equity in your present home is potentially greater than you might think, and with interest rates so low, it’s possible you can get into another home for not much more in monthly payment costs.

Also worth considering when you sell your present home is the possibility of leasing it back from the buyer so that you have time to complete the process of finding a new home or getting ready for a move. That’s not always an option, but it’s certainly one we can request when listing your home.

New home construction is a more viable option than in past years and I’ve helped a number of clients in their new home purchases recently.  My good relationships with a number of local builders has given my clients an advantage.  I can help with site and home selection and even direct folks to the best lender for their individual situation.  And did I mention this comes at no additional cost to the client?  Just one of the many things I provide as part of my special brand of customer service.

So, if you are thinking of making a move…don’t delay.  It won’t be as easy as in the past to find what you want, need and can afford, but having me on your side will significantly help.  I have been in the local residential real estate arena for more than 47 years, and with my investment banking background to boot, can help you make all your residential real estate dreams come true.  

It all starts with a call to me at 593.1000 or an email to Harry@HarrySalzman.com and we can get the ball rolling.  The sooner you begin, the sooner you’ll be living in the home that can provide you with the comfort and security you want, need and deserve.

 

And now for statistics…still “off the chart” but lack of listings is troubling…

You will see that home prices are continuing their upward trend due in part to low interest rates, low inventory and a pent-up demand created by the pandemic. 

 

OCTOBER 2020 

Statistics provided by the Pikes Peak REALTORS Service Corp., or it’s PPMLS

Here are some highlights from the October 2020 PPAR report.  Remember that the new format of this report no longer provides monthly statistics for each individual neighborhood.  However, if you are interested in what’s happening in your neighborhood, I can provide you with this information through other means.

In El Paso County, the average days on the market for single family/patio homes was 21.  For condo/townhomes it was 11.  

The sales price/list price for single family/patio homes was 100.8% and for condo/townhomes was 100.6%.  

Please click here to view the detailed 9-page report, including charts.  If you have any questions about the report or to find out how it relates to your individual situation, just give me a call.

 

In comparing October 2020 to October 2019 for All Homes in PPAR:                       

                        Single Family/Patio Homes:

·       New Listings were 1,559, Down 6.3%

·       Number of Sales were 1,732, Up 19.6%

·       Average Sales Price was $432,477, Up 16.2%

·       Median Sales Price was $383,447, Up 14.5%

·       Total Active Listings are 881, Down 54.6%

·       Months Supply is .05, Down 62.0%

 

Condo/Townhomes:

·       New Listings were 230, Up 19.8% 

·       Number of Sales were 260, Up 24.4%

·       Average Sales Price was $276,160 Up 7.5%

·       Median Sales Price was $262,000, Up 13.9%

·       Total Active Listings are 101, Down 46.3%

·       Months Supply is 0.4, Down 56.8%

And a look at more statistics…

 

October 2020  LOCAL MARKET UPDATE  AND  MONTHLY INDICATORS  ILLUSTRATE OUR LOCAL TRENDS IN DETAIL

Colorado Association of REALTORS^{® ,} Pikes Peak REALTORS Service Corp, or it’s PPMLS

Providing greater detail than the above report, this contains information on both El Paso and Teller counties for residential real estate. 

It is broken down by geographical areas and you can look to see how your neighborhood is doing in terms of sales, prices, and more.  

The “Activity Snapshot” for all residential properties in El Paso and Teller counties shows the Year to Date one-year change:

• Sold Listings for All Properties were Up 19.5%
• Median Sales Price for All Properties was Up 14.1%
• Active Listings on All Properties were Down 54.1%

You can click here to read the 16-page Monthly Indicators or click here to get specific information on the geographical area of your choice from the 18-page Local Market Update. I recommend that you check out your own area or one that you are considering, to get a good idea of the local pulse. As an example, here is a detailed report on the Colorado Springs area:

HOT housing market NOT LIKELY TO COOL IN WINTER

Realtor.com , 11.3.20

Winter is normally a slow season in real estate, but economists predict it isn’t likely to be that way this year.  Lawrence Yun, economist for NAR, says “It will be one of the best winter sales years ever”.

As previously mentioned, low inventories, combined with high demand due to record-low interest rates is sending buyers to the market quickly.  

“We currently see buyers sticking around in the housing market much later than we usually do this fall,” says Danielle Hale, realtor.com’s chief economist.  “If that trend continues, we will see more buyers in the market this winter, too. So this winter is likely to be a good time to sell.”

Here is a snapshot of the national picture of existing home sales in September 2020.  As you can see, prices continue to rise, and inventory continues to drop.  Sales are higher and inventory is lower locally, but you get the idea.  It’s a busy, busy housing market most everywhere.

 

I can’t emphasize enough that if you are even thinking of making a move, NOW is the time for us to start the process.  There are options available for most all situations and with my experience and expertise, I’m the one that can help you navigate through the home buying and selling wars. 

Give me a holler sooner than later and together we will find the right situation for all of your family’s wants, needs and budget requirements.

  

UCCS ECONOMIC FORUM DASHBOARD

UCCS Economic Forum, College of Business, updated 10.29.20

As always, I like to share the info I receive from the UCCS Economic Forum as soon as it’s available.  You can click here to see the U.S. “Big Picture” as well as the local economic news.

If you have any questions, please give me a call.

October 20, 2020

 

HARRY’S BI-WEEKLY UPDATE

        A Current Look at the Colorado Springs Residential real estate Market

As part of my Unique Brand of 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.  

 

 

 

AND SO IT CONTINUES….

Having been in the Colorado Springs residential real estate arena for more then 47 years I often think I’ve seen it all…but then something happens and I realize there’s still more to see. What I’ve been seeing and thinking about lately is how much has changed in the last several years--in the world generally, but also in my professional world.

Home prices are going through the roof—literally.  And mortgage interest rates are going into the cellar—also literally.  We’ve seen enormous home appreciation over the past several years and until there are more available listings, this is going to continue.  In the U.S., the average home appreciation from August 2019 to August 2020 was 5.9%.  Our local appreciation was almost twice that.  

Mortgage interest rates keep spiraling downward—and this is affording many folks the ability to get 15-year mortgages rather than the more traditional 30-year ones, resulting an even greater savings in interest and faster home equity.  When I first started selling real estate, a 12% mortgage was the norm and I’ve even seen ones at 9% and higher!  Today, mortgage rates are under 3%—something I could never have imagined back then.

And interestingly enough, if you think about what really matters—monthly housing out-of-pocket costs—things haven’t changed that much.  I often need to remind my clients that with prices increasing and mortgage rates declining, out-of-pocket monthly cost can often be less than it was with lower homes values and higher interest rates.  

This current pandemic has caused so many of us to reconsider what we want and need in our living spaces. WFH (working from home) is the new normal for many and not likely to change in the near future.  Home schooling and virtual learning can be an option due to COVID-19.  Folks are avoiding their normal workout places and ordering exercise equipment for the home, and outside entertainment areas have become a necessity. These factors have created the need for separate spaces so the entire family can proceed with life in the new normal in the best way possible.   

Some are taking this time to deal with renovation of their present homes while others are looking for new homes or new neighborhoods.  Unfortunately, this pandemic hit at a time when available housing is at a record all-time low locally.  When homes come on the market, they are tending to sell in record time and often over list price.  Bidding wars are prevalent, and disappointment is all too common.  Buying and/or selling a home should be an exciting adventure and I try to make it as stress-less as possible for my clients.  Therefore, it’s quite distressing for me to see my clients disappointed due to not getting their first or second choice or having to deal with buyers who have not-so-scrupulous lenders, and more.  I often wonder if some of the “new” real estate professionals could possibly imagine a day when there were so many homes for sale that buyers got a relative bargain at times.  Those days are long gone, but they sure made things easier for all.

New home construction has become a choice for many of my buyers due to some of the above reasons and also because a lot of the new homes have the “spaces” that folks are now realizing they want and need.  Inventory is better than it was previously since home construction was able to continue while other industries were shut down.  However, the availability and price of lumber and other materials has contributed to new construction price increases as well.  

I’ve been working with a number of clients, both local and ones who are relocating here, in dealing with home builders and have helped them in site selection, home features and have also directed them to lenders who can work with their individual situations.  This is a service I provide AT NO ADDITIONAL COST to my clients and one that has saved them substantial dollars as well.  If new construction is an option, please give me a call and let’s discuss the possibilities for you and your family.

Actually, no matter whether it’s new construction or existing home sales, I’m your guy.  With all my years of experience, along with my investment banking background, I’m your “ace in the hole” when it comes to residential real estate.  

So, if you’ve been thinking about making a move, or even purchasing for investment purposes, NOW is the time to at least see what you can do to make your real estate dreams a reality.  Just give me a call at 593.1000 or email me at Harry@HarrySalzman.com and let’s get the ball rolling.  

 

real estate INVESTING 101

YPN Realtor, The Lounge, 10.8.20

As many of you know, I put my money where my mouth is.  I have been investing in residential real estate since I started in this business and it has proven time and again to be not only a sound, but also lucrative business.  In fact, just last month I sold the very first home I purchased for investment back in 1977.  I purchased it for $20,800, sold it for $289,500, and collected rent on that home for all the years in between.  You do the math—even after essentially gutting and redoing it prior to sale, I still made a substantial profit.  

Being a landlord can be quite rewarding, but it’s not for everyone.  At first I acted as my own property manager, but now I employ one to take care of my investment properties.  Either way can work—it all depends on how much time and energy you want to put into it. 

Here are a few tips that can help you become the owner and property manager of a successful rental property:

 

1.  Run the Numbers.  A rental property should serve as another source of income.  Unlike buying an owner-occupied property, it’s all about your bottom line.  That means you need to consider the numbers rather than emotions when you’re looking for a property.  You need to strive for a positive cash flow when considering the property’s monthly expenses and how much rent you can charge in the current market.  This needs to be the driving force behind your decision.  The goal is to exceed your monthly home payment and repair budget.  And investors typically need 20% down to qualify for a mortgage so there’s that to consider too.

 

2. The Rental Search.  There are a lot of layers to this, but number are the key, followed closely by location.  Traditionally, purchasing a home in an expensive area may help guarantee that the home will hold its value or increase in price.  Yet some investors prefer a more affordable area where purchase prices are lower but may not gain equity as quickly.  The difference is higher instant gains versus long-term returns.  Also important is weighing the pros and cons of different property tax rates and potential assessments.  (Your tax and/or investment advisors can help steer you in the right direction.)  Proximity to your home is also important if you plan on handling repairs yourself. 

 

3. Single-Family Homes vs. Attached Housing.  Single family rental properties may have more long-term expenses such as the roof, siding, and mechanical replacements.  Again, it’s all about running the numbers when considering a single-family property versus a townhome or condo in a multi-unit building. If a condo can give you a positive cash flow, that might be the way to go.  Attached housing could also be a great opportunity to ease into investing.

 

4. Maintenance.  If you are good at home repair, bravo for you.  Most of us need to hire others to tackle repairs in our homes and that would include rental properties as well.  You can keep the cost down by tackling some small items you can handle while hiring out things like plumbing, electrical, heating and cooling, etc.   As I mentioned earlier, some folks hire property managers to handle all of this, as well as the collecting of monthly rent.  For this they take a percentage that will run you around 10% to 15% or more. 

 

These are just a few things to consider and I’d be happy to discuss my own personal experiences in owning rental properties with you if you are interested.  Again, let me remind you that it’s important to discuss all options with your tax and/or investment advisors first.  I can help you find an investment property, but I can’t advise whether it’s advisable or even feasible for you to do so from a tax standpoint.

 

MORTGAGE RATES SET RECORD LOW FOR 10^TH TIME

Freddie Mac Survey, 10.16.20

Mortgage rates fell slightly the week of October 15^th, setting a new record low for the 10^th time this year, according to Freddie Mac.  The 30-year, fixed-rate mortgage averaged 2.81%, the lowest rate since Freddie Mac began tracking such data in 1971.  The previous low of 2.86% was set in mid-September.

“Low mortgage rates have become a regular occurrence in the current environment,” says Sam Khater, Freddie Mac’s chief economist.  “As we hit yet another record low, many people are benefiting, as refinance activity remains strong. However, it’s important to remember that not all people are able to take advantage of low rates, given the effects of the pandemic.”

However, home buyers who are ready to enter the market are rushing to take advantage of these lower borrowing costs.  “With mortgage rates to remain near 3% for the next couple of years, homebuying activity is expected to stay strong for several more years,” Nadia Evangelou, a research economist for NAR wrote on NAR’s Economists’ Outlook blog.

 

AND, ACCORDING TO LAWRENCE YUN, NAR chief economist:

“Home prices have mostly outpaced broader consumer price inflation over the past decade.  From 2010 to mid-2020, the median home price (nationally) rose 61% to reach $295,300.  The key reason:  steadily shrinking supply coupled with steadily rising demand.  Americans saw inflation of 18% and a wage hike of 30% over the same 10-year period.  Yet, incredibly, the percentage of income devoted to a mortgage principle and interest payment to buy a median priced home is essentially unchanged, reflecting the awesome power of low mortgage rates…”

“More amazingly, in the midst of a pandemic and high unemployment, home prices are setting new highs, with multiple offers common on many properties.  The rate of home sales, after plunging during the spring shutdown (nationally) is poised to surpass 2019 levels in the final months of the year.”

Yun’s comments reflect what I’ve been telling you for some time.  NOW is the time to buy and sell. No matter the higher cost of the homes, it’s the monthly payments that count…and they are likely much lower than you might imagine.  Give me a call sooner than later and let’s discuss.