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Enewsletter - January 25, 2010

by Harry Salzman

HARRY’S COLUMN

EVERYBODY LOVES COLORADO SPRINGS

On January 21, 2010, the Colorado Springs Regional Development Corporation released their annual report on the economy of Colorado Springs in 2009. In their 20 page report, they included some references to our city in various national publications. In no particular order, here are some of the recognitions that Colorado Springs received in 2009:

The University of Colorado at Colorado Springs was ranked 6th best in the nation for engineering and the quality of all programs – U.S. News and World Report

3rd Best Cities for a Housing Recovery – Forbes.com

24th Metro Least Touched by Recession – Business Week

One of the best Southwest cities for defense jobs – FedSmith.com

9th in America’s Best Midsize Metropolitan Areas – MSNBC

10th on the list of Best Places for Business and Careers – Forbes Magazine

8th best city to find a fresh start – Business Week.com

6th top city for defense jobs – ClearJobs.com

9th in America’s “Best Bang For The Buck Cities” – Forbes.com

3rd Midsize Magnet city – Next Cities

14th for areas with the cleanest air – American Lung Association

Best Place to Live – Outside.online

7th Best City to Raise an Outdoor Kid – Backpacker Magazine

3rd most-obsessed sports town in America – Men’s Health Magazine

2nd fittest city in the country – Men’s Fitness Magazine

One of the top “10 Best Drivers’ Cities in America” – Car and Driver Magazine

10th best drivers – Allstate America’s Best Drivers Report

Well, this is all fine and dandy, but many people think it might be a good idea to keep all this positive P.R. a secret. They don’t want everybody in the world to know what a great place this is to live. But we wanted you, our readers, to know, so you could take advantage of the opportunity to buy real estate right now, while prices and interest rates are low and before the secret is out.

APRIL 5 AND APRIL 30 – TWO DEADLINES FOR BUYERS AND SELLERS

There are two upcoming deadlines that will affect both Buyers and Sellers of real estate nationally. We will outline both of these deadlines here:

The first deadline for Buyers and Sellers is April 5, 2010. On that date, the Department of Housing and Urban Development will initiate new regulations for FHA loans. Among the changes that will take affect on that date are:

1. The mortgage insurance premium for FHA mortgage insurance on loans which are assigned on or after April 5, 2010 will be raised from 1.75% to 2.25% of the loan amount.

2. Individuals who have a credit score of less than 580 will be required to pay a minimum down-payment of 10% of the sales price, rather than the traditional minimum of 3.5%.

3. The percentage of loan fees and closing costs which the seller is allowed to provide will be reduced from 6% to 3%.

These changes will make purchasing a home more expensive for Buyers and will reduce the incentives that Sellers can offer to prospective Buyers.

Because there will probably be a lot of people who want to beat this deadline, there could easily be a backlog of loan applications, so we are advising our clients to buy in March, to insure that their loans will be assigned by April 5, 2010.

The second deadline involves the Homebuyers Tax Credit, which provides for a tax credit of $8000 for first-time Buyers and up to $6500 for repeat Buyers. This tax-credit will no longer be available for anyone who does not have a contract in place by April 30, 2010 and which must close by June 30, 2010. Please give us a call to discuss the details of this program which could be a very valuable benefit to you.

Buyers, please contact us to learn more about the soon-to-be-expired opportunities for purchasing your home. Sellers, please contact us for information about marketing your home, especially for assistance in properly pricing your home in this competitive market.   

The bottom-line for both of these significant deadlines is that, whether you are a prospective buyer or seller,  NOW IS THE TIME TO MAKE YOUR MOVE  !!!

NEW IRS FORM AVAILABLE FOR FIRST-TIME HOMEBUYERS CREDIT

Department of the Treasury Form 5405 is now available online for individuals claiming their tax credit as first-time homebuyers, or, as repeat buyers. Click here for a copy of the form.

U.S.CONSUMER CONFIDENCE REACHES HIGHEST LEVEL SINCE SEPTEMBER 2008.

After declining throughout much of 2009, American consumer confidence improved sharply in January 2010, returning to levels not seen since the financial crisis began in September, 2008. This was reported in the most recent results of the RBC CASH (Consumer Attitudes and Spending by Household) Index, as reported in RISMEDIA. Driven by the largest-single-month gain in expectations for jobs since the inception of the Index eight years ago, the RBC Index for January 2010 stands at 58.3, up 19.3 points from its December 2009 reading of 39.0.

On the local front, sales tax collections rose 2.54% in December 2009, compared to December of 2008. This represented the largest monthly gain since January of 2008 and was the second consecutive year-to-year gain, in spite of the fact that local unemployment in November, 2009 was reported at 7.3%. Compared to the reported national unemployment figure of 10%, that would place us about 20% better-off than the rest of the country.   

And, please remember, I would be honored to serve as your Broker for all of your residential real estate needs. I want to help you, my reader, make the most prudent and accurate Real Estate business decision.

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 37 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.

Just click on the icon at the top of this email to listen to my latest podcast. ….And, if you would like to learn more about our Job Loss Protection Program, or, about our CyberHomes Complete Market Analysis of a property, please contact us. 

JOKE OF THE WEEK

 A man receives a call from his Credit Card Company,

“Sir, we have detected an unusual pattern of spending on your card, and we are calling to see if everything is alright.”

"Yes,” replied the man. “My card was stolen over a month ago.”

“Why didn’t you report your card as stolen?” asked the card company representative.

The man replied, “Well, whoever stole my card is spending a lot less than my wife!”

 

Enewsletter - January 19, 2010

by Harry Salzman

HARRY’S COLUMN

INCENTIVES ARE THE BUZZWORD

Considering wherever you might be within the current position of your business cycle, various types of incentives are what will create the positive change. Incentives can be all types, from the Federal Government, to states and cities; from the Seller who must sell their house to using various bonuses to attract a Buyer.

In order to receive the greatest rate of return, here are some examples of marketing concepts that we have found to be mutually beneficial – whether you are a Buyer or a Seller. (Because all elements affecting real estate values, marketability, timeliness, etc., are localized, the enticements presented here are focused on the Colorado Springs area. Many of these ideas can certainly be correlated to other cities.)

One example of our services that can positively affect a client is our “incentive” of “Job Loss Protection”.

In the past week we have referred a doctor who is moving to Colorado Springs from Philadelphia to the proper real estate company to sell his house in Philadelphia.  We met with a local Seller who will be moving to Tennessee, to place their home in the Monument area on the market. In both cases, our “Seller” can use our Job Loss Protection as a great benefit to outperform their listing competition.

To remind our readers of the highlights of that marketing advantage, it is patterned after what Hundai Motors has done since 2008.  We’re sure you have seen their ads on TV. In a nutshell, what we offer is that, from the time of a closing, if a Buyer loses their job and gets “laid off”, we have a non-profit firm in Virginia to subsidize the Buyer’s monthly payment up to $1800 per month for up to 6 months. In order for the Buyer to obtain that terrific benefit, all they have to do is demonstrate that they are receiving  unemployment benefits from the state.

In order to fund this selling enhancement, at the time of closing, the Seller is debited only $500 on their HUD statement. It therefore reduces the capital gain upon the sold property.  We have found that this feature is a definite win for both the Buyer and the Seller.

Some other enticements that we offer to our Buyers, Sellers, corporate accounts, etc., are.:

Cyberhomes Complete Market Analysis for prospective Buyers

One year of Home Owner Association Fee

Family Gym Memberships

Riding Lawnmower (park in garage with a large bow and sign)

One year of Property Insurance

Snow Blower (park in garage with a large bow and sign)

One year paid Lawn Care, Maid Service, Snow Removal, etc

Gift card to Home Depot or Lowes

Gift cards for local Fine Dining.

Allowance for upgrades such as Hardwood Floors, Counter tops, Appliances, Light Fixtures

Allowance to upgrade Kitchen / Bath

Interest Rate Buy Downs

Prepay real estate Taxes for 6 months to a year

Pay Buyers Closing Costs

Bonus Commission to the Selling Agent

½ Day Packing Service

Packing Materials

Staging

Reimburse Inspection Fee upon closing

Just look at everything you’re missing, if you don’t buy a house from us !!!!

We welcome the opportunity to see how we can implement these ideas into your individual needs to outperform your competition.

WHY YOU WILL BENEFIT AS A real estate INVESTOR

We can no longer say, “Well, it’s business as usual”, or, “Well, the last time we came out of a recession, we did …..”. There are an absolute different set of criteria staring at us in the mirror. Here are some thoughts that, when implemented properly, should put some money into your pockets.

No matter what city you are reading this from, because it goes nationwide, these issues can be localized and are not exclusive to Colorado Springs. We are seeing an above average demand for good-quality rental homes, from both investors and from tenants. You see, it is our belief that many people who are losing their homes due to a foreclosure or short sale are still “credit worthy”. Their foreclosure problem might be because they were placed into the wrong mortgage by their lender. In other words, perhaps they didn’t meet a conservative type of qualification for the type of mortgage loan that their lender advised them to obtain. We are talking about millions, yes, millions of loans that were provided with “built-ins” like; zero funds down, a negative ARM, a loan of 105% to 125% of the sales price, etc.

Those people do not seem to be like the same borrower profile that the industry had to deal with prior to about 2005.

The increase in rental demand that we are seeing requested for rental homes today are from a tenant profile of a family which has been a recent property owner. They have typically maintained proper care for both the interior and exterior of their homes. Another major reason that the “tenant profile” has been established is because they were advised to obtain a mortgage with an adjustable rate. When the lender went to re-establish the new rate, the market value of the property was considerably below the current loan balance. Based upon the negative equity in the home, lenders either required the borrower to pay down the current loan balance or, if the homeowner was either unable or unwilling to do so, the lender began the foreclosure process.

Based upon a huge increase in this type of foreclosures and short sales, those former homeowners are increasing. There are many more people who must rent a home today, compared to the number of tenants prior to the middle of the past decade.

The point is that we are seeing a much greater demand for nicer rentals than we have seen in past years.

This ‘tenant profile’ should be a better quality tenant because they are used to properly taking care of their personal home.

Therefore, since the market is providing the investor with:

            A better quality of tenant

            The ability to select a better quality of rental house to buy

            Record low interest rates for a “non-owner occupant”

            Appreciation in housing values because of the looming inflation

You should probably give us a call to allow us, as an investor advisor, to give you some ideas of how the Colorado Springs residential market can be a positive factor in your investment portfolio.

GAZETTE PUBLISHES MOST RECENT HIGH-SCHOOL GRADUATION RATES

The Colorado State Board of Education has released the local high-school graduation rates for 2009. You will note that, among the best performing districts, are Academy (2), Lewis-Palmer (38) and Cheyenne Mountain (12). Courtesy of the Gazette, we are linking the statistics here.

If you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 37 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.

To hear my latest podcast, just click on the icon at the top of this email and, if you would like to learn more about our Job Loss Protection Program, or, about our CyberHomes Complete Market Analysis of a property, please contact us. 

JOKE OF THE MONTH

Once upon a time, in a place overrun with monkeys, a man appeared and announced to the villagers that he would buy monkeys for $10 each.

The villagers, seeing that there were many monkeys around, went out to the forest, and started catching them.

The man bought thousands at $10 and as supply started to diminish, they became harder to catch, so the villagers stopped their effort.

The man then announced that he would now pay $20 for each one. This renewed the efforts of the villagers and they started catching monkeys again. But soon the supply diminished even further and they were ever harder to catch, so people started going back to their farms and forgot about monkey catching.

The man increased his price to $25 each and the supply of monkeys became so sparse that it was an effort to even see a monkey, much less catch one.

The man now announced that he would buy monkeys for $50! However, since he had to go to the city on some business, his assistant would now buy on his behalf.

While the man was away the assistant told the villagers, “Look at all these monkeys in the big cage that the man has bought. I will sell them to you at $35 each and when the man returns from the city, you can sell them to him for $50 each.”

The villagers rounded up all their savings and bought all the monkeys.

They never saw the man nor his assistant again, and once again there were monkeys everywhere.

Now you have a better understanding of how the stock market works

Enewsletter January 11, 2010

by Harry Salzman

HARRY’S COLUMN

TOWN HALL MEETING PREDICTS GROWTH FOR PIKES PEAK AREA

On January 7, 2010, we had the opportunity to attend the “Town Hall Meeting” conducted by Fred Crowley, PhD, of the Southern Colorado Economic Forum. In this meeting, Dr. Crowley analyzed our local economy in 2009 and made projections for 2010. Some of the significant charts which he used to illustrate his various points are linked here, for your information.

The Business Condition Index for El Paso County illustrates that our local economy has bottomed out and is starting to rebound, as we have been predicting for the past several months. The PPAR monthly statistics which give the details of how our local real estate fits into this overview of business conditions show the same kind of encouraging growth.

The Annual Growth Rate of our gross domestic product shows the positive direction of the nation, including Colorado, but Colorado Springs leads both the nation and the state in its recovery.

One of the best growth industries has been “Professional and Technical Services”, with companies in this field employing large numbers of skilled workers. Again, Colorado Springs is a leader in this area.

Per capita sales tax revenues has shown a consistent annual decline, with another decline predicted for 2010, primarily because of slow sales in ‘big ticket’ items and housing, plus the continuing growth of consumer purchasing on the internet.

The specific economic projections for El Paso County show encouraging signs of recovery in 2010, with increases in population, wages, personal income, retail activity and housing permits.

If you would like a copy of this very informative 100+ page report, just give us a call or send us an email and request a copy and we will be happy to forward one to you.  

PIKES PEAK ASSOCIATION OF REALTORS ISSUES YEAR-END STATISTICS

The recently-issued PPAR year-end statistics contain some encouraging information for prospective home buyers and sellers.

The total number of single-family home sales in Colorado Springs in 2009 was 25.9% higher than it was in 2008, with December showing the seventh consecutive monthly increase.

The average home sale price in December 2009 was $223,143, compared to $214,062 in November 2009 and $227,376 in December 2008.

The median home sale price in December 2009 was $192,500, compared to $187,950 in November 2009 and $180,000 in December 2008.

A very significant statistic was “Total Active Listings”. At year end, that number was 3951, compared to 4951 at the end of 2008. That translates into a reduction in inventory of 20.2%.

The number of homes sold in 2009 in Colorado Springs was 8745, compared to 8339 in 2008, for an increase of 4.9%

All of these numbers demonstrate that, during 2009, there was a definite decrease in the “supply” of available homes, together with an increase in both median and average prices.

real estate SETTLEMENT PROCEDURES ACT CHANGES AS OF January 1, 2010

Some new RESPA changes were established to provide borrowers with essential information about and adequate time to understand the terms of their home mortgage loans.

Under the new regulations, lenders, mortgage brokers an closing agents will be required to provide borrowers with an easy-to-read Good Faith Estimate (GFE) that will clearly answer the key questions they may have when applying for a mortgage, including:

            What is the term of the loan?

            Is the interest rate fixed, or, can it change?

            Is there a prepayment penalty should I choose to refinance at a later date?

            Is there a balloon payment?

            What are the closing costs?

The new GFE will consolidate closing costs into major categories and display total estimated settlement charges prominently on the first page so the borrower can easily compare loan offers. Loan originators are required to provide borrowers with the GFE within three days of receipt of a completed mortgage application. To allow borrowers the opportunity to compare loan offers, the loan originator cannot require verification of application information (tax returns, etc.) until after the applicant receives the Good Faith Estimate and makes the decision to proceed with the loan.

Under the new regulation, closing agents will now be required to provide borrowers with a new three-page RESPA Reform Settlement (HUD-!) that clearly compares final settlement costs with the GFE costs. Lenders will be working more closely than ever with closing agents to ensure compliance with the new HUD-1 Settlement Statement.

We understand the impact of this new rule and its implications in the purchase process and this is another reason why We should be your Realtor.

And, please remember, I would be honored to serve as your Broker for all of your residential real estate needs. I want to help you, my reader, make the most prudent and accurate Real Estate business decision.

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 37 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.

Just click on the icon at the top of this email to listen to my latest podcast. ….And, if you would like to learn more about our Job Loss Protection Program, or, about our CyberHomes Complete Market Analysis of a property, please contact us. 

JOKE OF THE WEEK

In honor of the upcoming Super Bowl, we are listing some of the cleaner jokes about the various teams that play in the NFL. (Don’t blame us …We didn’t make these up).

The Seven Dwarfs were marching through the forest one day they fell in a deep, dark ravine. Snow White, who was following along, peered over the edge of the steep chasm and called out to the fallen dwarfs. From the depths of the dark hole a voice returned, "The Seattle Seahawks  are Super Bowl contenders."

Snow White thought to herself, "Thank God... at least Dopey's survived!"

Why do San Diego Chargers players keep their Wonderlic results on their dash boards?

So they can park in the handicap spaces.

What do you get when you put the girlfriends of a dozen Tennessee Titans fans in one room?

A full set of teeth!

Why did the NY Jets players miss their flight for the big game?

They were stuck on a broken escalator!

If you see an Oakland Raiders fan on a bike, why should you not swerve to hit him?

It could be your bike.

You're trapped in a room with an angry grizzly bear, a hungry Lion, and a fan of the Oakland Raiders. You have a gun with two bullets. What should you do?

Shoot the Raiders fan… twice.

What do you call a Buffalo Bill’s fan with half a brain?

Gifted!

Why the Arizona Cardinals are like a possum?

Because they play dead at home and get killed on the road.

What did the average San Francisco 49er player get on his Wonderlic test?

Drool!

Why did The Dolphins choose Orange for the team color?

So the fans could wear it on Saturday to the game, on Sunday to go hunting, and the rest of the week picking up garbage on the highways.

What's the difference between a winning Raiders team and a UFO?

Someone has seen a UFO.

What do you call a Cleveland Brown with a Super Bowl ring?

A thief

Why doesn't Columbus, Ohio have a professional football team?

Because then Cleveland would want one.

What do you call the Broncos on their opponents 10-yard line?

Lost

What's the difference between a Raiders fan and a Chimp?

Ones hairy, stupid and smells, and the other is a Chimpanzee.

What do Raiders fans and laxatives have in common?

Both irritate the absolute crap out of you.

What do you say to a Raiders fan with a job?

"I'll have a Big Mac, fries and a coke, please."

What's the difference between the Buffalo Bills and a dollar bill?

You can still get four quarters out of a dollar bill

Enewsletter -January 4, 2010

by Harry Salzman

HARRY'S COLUMN 

TWO GOOD REASONS FOR BUYING YOUR HOME RIGHT NOW

1. The Federal Tax Credit of $8000 for First Time Home Buyers ($6500 for Home Owners) is, essentially, a discount on the price of your new home. 

2. The El Paso County Bond Program which was announced last week offers 30 year, 4.625% fixed rate mortgages to qualified Buyers who do not need down-payment assistance. This is a below-market rate. These Bond Program loans are available for homes throughout El Paso County, including the City of Colorado Springs. This is a great opportunity to lock in a very attractive loan on your new home.

To be eligible for these Bond Program loans, Borrowers cannot have owned a home in the past 3 years, unless they are purchasing a home within a "Targeted Area". (Targeted Areas are census tracts designated by the IRS and will be specifically identified in the Agreement.) Note that Qualified Veterans are exempted from the First-time homebuyer requirements.

The maximum family incomes that qualify for these loans are:

For families of 2 or fewer, $71,000, if buying within Non-Targeted areas, or, $85,200, if buying in a Targeted area.

For families of 3 or more, $81,650, if buying within Non-Targeted areas, or, $99,400, if buying in Targeted areas.

To be eligible, a family home must have a maximum acquisition cost of $283,000 in Non-Targeted areas, or $ 347,000 in a Targeted area.

This program will be excellent for Veterans who do not need assistance with their down-payment and the seller can pay all closing costs and prepaids, allowing the Vets to buy with no cash out-of-pocket. It is also great program for FHA borrowers who have their own down payment or who can get a gift from relatives.

Families which need assistance with the down-payment are also eligible for this program, but the interest rate goes up to 5.125%. This is still a below-market rate.

If you have any questions about this new El Paso County Bond Program, or about the Federal Tax Credit for Homebuyers, please give me a call.

Who says there is no Santa Claus?

A TEN YEAR OVERVIEW OF YOUR INVESTMENTS ...WHAT'S THE BOTTOM LINE ??

Everyone has an investment strategy. Some people play the stock market, some people play the ponies, some keep their money in a shoe box under the bed. Over the past ten years, however, the best investment by far has turned out to be Residential real estate.

During the last ten years, if you kept your money in a shoe box, it would not have grown at all (in fact, with inflation, it would now be worth much less than it was when you put it under the bed). If you played the ponies, we'll bet you ten to one that you lost money. But, the really bad news is that, according to the Wall Street Journal (Jan. 4, 2010), if you played the stock market, you also lost money. In fact, according to their summary of the last ten years of stock market changes, the shoe-box strategy might even look good.

WSJ reports that, over the past ten years, the Dow Jones Industrial Average has gone down 9.3%. The Standard and Poor 500 has gone down 24.1% and the Nasdaq Composite has gone down 44.2%. What an unpleasant surprise !!! Just think about the hours you spent studying the market and talking to your Broker, the charts you have pored over and the sleep you have lost trying to increase the value of your investments. And it turns out you would have been money ahead if you had just bought a house in Colorado Springs.

During the past ten years, while their owners were knocking themselves out, trying to make a profit, their houses just sat there, increasing in value. In fact, during the past ten years, the average price of a house in the Pikes Peak area has increased $32,976 (18.21%) and the median price has increased $49,960 (35.69%). Whoda thunk it?

Don't let the next ten years pass you by. Buy your first Colorado Springs home now, or, trade up to your dream home today. It's your best investment !!!

NOW HERE'S THE WAY STIMULUS MONEY IS SUPPOSED TO WORK

Connecticut Governor M. Jodi Reil gets our award for putting Stimulus money to productive use. The Governor persuaded Starwood Hotels & Resorts Worldwide to relocate their corporate headquarters from New York to Connecticut. Starwood owns several hotel brands, including the Sheraton, the Westin and W hotels. Their headquarters employs 800 largely executive-level jobs.

Governor Reil used $35 million of federal stimulus money to pay for infrastructure improvements at the selected site and Starwood agreed to lease 250,000 square feet of office space. As part of the incentive package, Starwood was offered a $89.5 million package, which included a $9.5 million low-interest loan, $5 million in sales tax relief and as much as $75 million in tax credits. As a result of this forward-thinking proposal, the Governor has succeeded in creating hundreds of new businesses and new jobs. The 80 acre Starwood site will include a city park, the headquarters of Pitney-Bowes, a boardwalk and a marina, two hotels, three new office buildings and 400,000 square feet of retail space and is scheduled to open in 2012.

Despite a weak economy, Governor Reid has demonstrated that cities and states can attract good primary jobs by wisely investing stimulus money, incentives and tax credits.

Way to go, Governor Reil !!   Bill, please take note !!      

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Harry A Salzman
ERA Shields / Salzman Real Estate Services
5475 Tech Center Drive, Suite 300
Colorado Springs CO 80919
719-593-1000 or Toll Free: 800-677-MOVE(6683)
Cell: 719-231-1285
Fax: 719-548-9357

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