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COLORADO SPRINGS BEATS THE NATIONAL AVERAGES AGAIN

by Harry Salzman

January 31, 2011

HARRY'S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTIAL real estate MARKET

COLORADO SPRINGS BEATS THE NATIONAL SALES FIGURES AGAIN

The latest Standard & Poor's Case-Shiller Home Price Index shows that, in the top 20 U.S. cities surveyed, real estate prices fell 1.6% in 2010.

Added to that, the Wall Street Journal (Mon. Jan. 31, 2011) announced, "Home Prices Sink Further". The article points out that, in the WSJ quarterly survey of the major metropolitan areas of the country, 2010 home prices declined in every one of the 28 areas covered by their survey.

However, we just received a copy of the latest report from the Southern Colorado Economic Council from Fred Crowley, the chief economist for the SCEC, and the report clearly shows that, during 2010, Colorado Springs median and average home prices both rose. In other words, we are better off than any of the top 48 metropolitan areas in the country. How do you like them apples??

We hate to make the other major metropolitan areas in the U.S. feel bad, but we cannot overlook this opportunity to point out that we live in the best place in the USA. Our economy is better than any of the cities in both of the surveys cited above.

Apparently, the theme song for Colorado Springs should be,"O Lord, It's hard to be humble, when you're perfect in every way".

To see the complete SCEC report and to learn how well our local economy is doing, Click here.  

 

..PLUS THE FACT THAT IT'S STILL CHEAPER TO LIVE HERE !!!

The Gazette also reported that our local cost of living is still below the national average. (Jan. 29, 2011). Even though gas prices nudged our local cost of living up .5% in 2010, we are still 7.2% below the national average cost of living. Now, if we all go out and buy electric cars, we will really beat the national average. .(but who can afford a 40 mile extension cord?)

 

HERE'S WHAT THE EXPERTS ARE SAYING ABOUT OUR LOCAL ECONOMY

On January 27, 2011, we attended the presentation, "Navigating in the New Economic Reality", sponsored by Vectra Bank. The featured speaker was Dr. Tom Zwirlein from UCCS. The speaker presented a local business forecast for the coming year and featured some very interesting data about our local economy. Here are some of the points discussed:

  • There will be a rise of approximately 1 ½% in interest rates in 2011.
  • Colorado Homeownership will fall by approximately 2-3% in 2011. Obviously, this means that some home occupancy will shift from ownership to rental status. This is good news for owners of rental property. (Our present vacancy rate is around 3%. That's very low).
  • The Housing Affordability Index will be approximately the same as it was in 2009-2010.
  • Local foreclosures are projected to be 4200 in 2011 (vs. 5470 in 2009 and 4828 in 2010). Good !!! The trend is down !!
  • The number of residential sales has remained fairly constant for the past three years (2008 - 8339, 2009 - 8346, 2010 - 8222).
  • Our local unemployment rate is projected to drop from 8.4% to 7.9% in 2011.
  • Our local population is forecast to grow by1.5% in 2011.
  • Personal income and retail sales are both forecast to rise modestly in 2011, but single-family housing permits are predicted to decline.

All of these factors point to the fact that rental property will be a great investment in 2011, especially if you buy before interest rates rise any further.

Call us.

 

TIMES A WASTIN' - BETTER CALL US RIGHT NOW

As we have been predicting, mortgage interest rates are continuing to edge up. The Wall Street Journal reports that rates are "edging closer to 5%".

With local home prices and interest rates both on the rise, you shouldn't postpone buying that new home or investment property any longer.

 

HOW WILL THE NEW 3.8% TAX ON real estate AFFECT YOU ?

We have been getting lots of phone calls asking us about "the new 3.8% tax on real estate". The good news is that it probably won't affect most of our readers.

As of January 1, 2013, there will be an additional tax of 3.8% on some income from interest, dividends, rents (less expenses) and capital gains (less expenses).

The new tax will apply to: 

  • Individuals with Adjusted Gross Incomes (AGI) above $200,000
  • Couples filing a joint return with more than $250,000 AGI
  • Capital gains from sale of a principal residence
  • Capital gains from sale of a non-real estate asset
  • Capital gains from interest and dividends: Securities
  • Rental Income, including REI investment income
  • Rental Income as sole source of earnings - real estate trade or business
  • Sale of a second home with no rental use (or no more than 14 days rental)
  • Sale of an inherited investment property (Residential or commercial)
  • Purchase and sale of Investment Property (residential or commercial)

You may want to discuss with your tax advisor how this new law might affect your taxes.

For your information, the National Association of Realtors has prepared a brochure outlining the details of this new law and citing several specific examples. For a copy of the brochure and to see a complete explanation of the law, Click here.  

 

IF YOU'RE A LANDLORD, HERE'S YET ANOTHER  NEW REQUIREMENT FROM THE GOVERNMENT !!!

If you're the owner of even a single unit of rental property, starting this year, you must start tracking all vendors doing at least $600 worth of work for you and send them an IRS Form 1099 at the end of the year

The IRS has not yet worked out the details of this new requirement, so we cannot yet clarify what it means for you but, you should start keeping track of your vendors, so you don't get blindsided at the end of the year. Better talk to your bookkeeper about this new law. 

Hey, what's the problem? You've got plenty of time on your hands.

 

LATEST STATISTICS

To see the latest Sales and Listing statistics for the Pikes Peak region, Click here.

 

THIRTEEN THINGS YOUR BURGLAR WON'T TELL YOU

Security consultant Chris McGoey interviewed 105 burglars for his book about protecting yourself and your home from being burgled. Click here to review some of his tips on protecting yourself.

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

Last week, because we assumed our readers were so involved with the NFL playoffs, the State of the Union address and the fact that the world is falling apart, we thought we could dispense with the Joke of the Week and nobody would notice. However, after publication, we received several complaints about the omission. So, now that we have been properly chastised, we will include two jokes; one for this week and one for the missing joke from last week.  

JOKE #1

Two women were walking through the woods when a frog called out to them and said: "Help me, ladies! I am a real estate broker who, through a curse, has been transformed into a frog. If one of you will kiss me, I'll be returned to my former state!"

One woman took out her purse, grabbed the frog, and stuffed it inside her handbag. The other woman said, "Didn't you hear him? If you kiss him, he'll turn into a real estate broker!"

The second woman replied, "Sure, but these days a talking frog is worth more than a real estate broker!"

JOKE #2

The following complaints were actually received by property managers from their renters:

 

"The toilet is blocked and we cannot bathe the children until it is cleared. "

"This is to let you know that there is a smell coming from the man next door. "

"The toilet seat is cracked: where do I stand? "

"I am writing on behalf of my sink, which is running away from the wall. "

"I request your permission to remove my drawers in the kitchen. "

"Our lavatory seat is broken in half and is now in three pieces. "

"Will you please send someone to mend our cracked sidewalk? Yesterday my wife tripped on it and is now pregnant."

"Our kitchen floor is very damp, we have two children and would like a third, so will you please send someone to do something about it. "

"Would you please send a man to repair my downspout? I am an old-age pensioner and need it straight away. "

"Could you please send someone to fix our bath tap? My wife got her toe stuck in it and it is very uncomfortable for us. "

"When the workmen were here, they put their tools in my wife's new drawers and made a mess. Please send men with clean tools to finish the job and keep my wife happy."

By the way, the playoffs and the State of the Union address are both over, but the world is still a mess. Sorry about that.

 

 

January 24, 2011

HARRY'S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTIAL real estate MARKET

 

 OUR ECONOMY IS IMPROVING ...WE'RE ON OUR WAY BACK UP !!

 After a couple of years of bad news, Colorado Springs and the local real estate market are showing definite signs of recovery. "Says who?", you ask. Well, here's just a few of the people, reports and surveys that say so:

 NATIONALLY -

  •  The National Association of Realtors (NAR) announced that "Existing-home sales rose sharply in December, when sales increased for the fifth time in the past six months".The Wall Street Journal explains that, "Bargains and low interest rates fueled the December gain of 12.3%. Buyers are snapping up bargains and rushing to lock-in historic low interest rates".
  • Lawrence Yun, chief economist for NAR, noted that sales are on the uptrend. He predicted that, "The recovery will likely continue as job growth gains momentum and rising rents encourage more renters into ownership while exceptional affordability continues".
  • Interest rates are still extremely low. Freddie Mac said Thursday that the average rate for a 30-year, fixed-rate loan was 4.74%, still a great bargain.
  • U.S. manufacturing has begun creating more jobs than it eliminates, for the first time in more than a decade (The Wall Street Journal, Wednesday, January 19, 2011). In 2010, the number of manufacturing jobs increased 1.2%, or 136,000, the first increase since 1997. Economists are predicting an increase of 2.5%, or 330,000 manufacturing jobs in 2011. Thomas Runiewicz, an economist at IHS, expects total U.S. manufacturing jobs to hit 12 million this year, and calls manufacturing "the shining star of this recovery".

LOCALLY -

  •  Colorado Springs Sales and Listing statistics show that our area has weathered the recession much better than most other metropolitan areas in the U.S. In 2010, our average and median selling prices for homes rose 3.4% and 4.4%, respectively, as compared to the national increase of only .3%. Click here to see our most recent Sales and Listing Statistics.
  • Fred Crowley, the chief economist for the Southern Colorado Economic Forum, notes that the local housing market bottomed out in 2009 and he predicts local home prices will rise by another 4% this year. He also predicts 2011 home and townhouse permits rising 22%, to about 1900 and sees foreclosures falling from last year's 4,828 to about 4,200 in 2011. 

(Readers, take note !!: This means that, in 2011, there will be another 2000-3000 prospective renters out there, waiting to rent that investment home you have been thinking about. Call us !!)

  •   "We've got stability", Crowley said. "And stability will grow the local economy 3-4%. But, private sector growth could grow the economy by 5-8%." To help stimulate this private sector growth, Fred is challenging our local businesses to invest in a venture-capital fund, as recommended by the Colorado Springs Regional Economic Development Corporation. "Such a fund would finance local entrepreneurs and startup companies." He even offered to write a $10,000 check to get the fund started. "This can be done", he emphasized. (To learn more about this proposed project, see the story about the CSREDC, below.)
  • In 2010, our local hotels occupancy rates bounced back from the lowest level in the in the 19-year history of the Rocky Mountain Lodging Report. Last year, hotel occupancy rose 60.9%, the highest rate since 2002. And, even better, bookings for future meetings and conventions are up, which promises increased income into the local economy in the years ahead.

 

NAR ECONOMIST TO VISIT COLORADO SPRINGS

Lawrence Yun, chief economist for the National Association of Realtors, will visit Colorado Springs on February 16, 2011. He will speak to our local Realtors and will get an update on how our local real estate market has managed to outperform many of the other metropolitan centers in the U.S. The meeting is restricted to Realtors, but we will report to you on what he has to say in our weekly enewsletter.

 

 AMERICAN ATTITUDES ABOUT HOME OWNERSHIP

NAR has recently released the results of a national survey which examined Americans' attitudes about home ownership. The survey, conducted by Harris Interactive, shows that a substantial majority of both home owners and current renters agree that owning a home is a smart decision over the long term.

A majority of homeowners and a sizable percentage of renters agree or strongly agree that owning a home provides a healthy and stable environment for raising a family, that it helps them meet long-term financial goals and helps them realize the American Dream.

The following links will allow you to view the entire survey.  

View the survey results of "American Attitudes About Home Ownership" > 

View charts and graphs from "American Attitudes About Home Ownership" > 

If you would like to pursue the American Dream of owning a home, please give us a call.

 

 CHANGE HAS COME - THE CSREDC'S RESPONSE TO THE NEW ECONOMIC REALITY

Last week, we had the pleasure of attending an exciting presentation by the Colorado Springs Regional Economic Development Corporation which outlined their strategic plan for attracting, retaining and creating quality jobs and investment in the Pikes Peak region. The presentation featured a slide presentation and an outline of the EDC's plan. The specific goals for the plan are:   

  1. Job Attraction
  2. Job Retention
  3. Entrepreneurial Job Creation
  4. Strategic Initiatives
  5. Capital investment

EDC's plan also identified the specific target industries that would make the best fit for our region and would best help us retain the unique way of life and lifestyle that our region offers. The target industries listed were:   

  1. Software and Information Technology
  2. Aerospace, Defense and Homeland Security
  3. Clean Tech - Renewable Energy
  4. Sports, Health and Wellness
  5. Emerging Industries and Entrepreneurs

It was refreshing and exhilarating to see that creative minds are aggressively working to stimulate economic growth in our region. The EDC has developed an innovative blueprint for our future and we invite you to read the entire presentation. It's obvious we are heading in the right direction.

Please click here to see the complete EDC plan for the future of Colorado Springs and click here for the slide presentation which explains the plan in more detail.

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.    

All Mortgage Companies are not created equal

by Harry Salzman

January 17, 2011 

HARRY'S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTIAL real estate MARKET

 

EDC TO UNVEIL PLAN TO KEEP COMPANIES IN COLORADO SPRINGS

This coming Thursday, we will be attending a luncheon sponsored by the Economic Development Corp. at which Mike Kazmierski, the head of EDC will unveil a plan to boost our local economy. The plan involves attracting new business to Colorado Springs by means of a city-sponsored Venture Capital project. One of the requirements of the program will be that the assisted businesses agree to stay in Colorado Springs.

The EDC will be developing this plan with UCCS Professor Thomas Duening, who is already laying the groundwork for what would be the city's first VC fund.

We are very excited to see this type of innovative planning introduced in our city and we will keep you advised of the details in future newsletters.

 

THE ECONOMY IS LEADING HOUSING BACK FROM THE BOTTOM

Last Friday, in his testimony to the Senate Budget Committee, Federal Reserve Chairman Ben Bernanke expressed more optimism about the economy. He predicted a "moderately stronger" overall pace for the economy in 2011, noting that the Fed has seen "increased evidence that a self-sustaining recovery" is occurring.

As evidence of this recovery, the Gazette reported that, on Friday, U.S. stocks reached their highest closing levels in 2 ½ years. The Dow Jones industrial average rose 55.48 points, its highest close since June 28, 2008. The good news is that the stack market has traditionally led the economy by two quarters, so, this present rise in the stock market is a good indication that the second half of 2011 will be booming.

Evidence is mounting that this economic recovery is already beginning to boost the housing market. Large price declines have made housing more affordable than at any point in the last decade and new housing construction has fallen to the lowest levels in more than 40 years. Both of these factors will help boost existing-home sales, absorb available inventory and put upward pressure on home prices.

Locally, the average sale price for Colorado Springs homes in 2010 was up 4.4%, even after including foreclosures in the mix. This increase in selling prices came as many other U.S. cities continued to show declines.

Unfortunately, foreclosures will continue to affect our local housing market in 2011. Last year, there were 4828 foreclosures in Colorado Springs, which was an 11.7% decline from 2009, but indications are that we will see another 4000 local foreclosures in 2011. Keep in mind, however, that as many as half of these foreclosures will never reach the market, because of refinancing, assistance programs, etc.

As always, however, our continued economic growth will be dependent upon JOBS, JOBS, JOBS. That's why we are so excited about the EDC plan which we discussed, above, and by the tone of our new Governor as he discusses his plans for attracting new businesses and new jobs to our state. It sounds like our state is on the right track.

 

ALL MORTGAGE COMPANIES ARE NOT CREATED EQUAL - THE SAME CAN BE SAID OF REALTORS !!!

Last week, we had the opportunity to help both a Buyer and a Seller save about $2000.

We were contacted by a Buyer's agent who had made arrangements with a local Lender to buy one of our listings. When we reviewed the paperwork, we discovered that the Lender had tacked on several fees and charges that would have cost both the Seller and the Buyer approximately $2000 in unnecessary costs for the $185,000 sale. Furthermore, the Lender was reluctant to sign a disclosure statement which was published in the listing.

On our recommendation, the Buyer's agent switched to one of our preferred Lenders and thus saved both parties from making a very expensive mistake.

The moral of the story: 

  1. Not all Lenders are equal. Dealing with an experienced Realtor, one who has long-term, professional relationships with conscientious, ethical Lenders, can save you time, trouble and money.
  2. Not all Realtors are equal. Our 38 years of experience in the local community, combined with our extensive knowledge of finance enabled us to provide this client with information and assistance that saved them thousands of dollars in unnecessary costs. Our experience, knowledge and close-working network of professionals, including lenders, appraisers, inspectors, stagers, builders, etc. can help make your real estate transaction as smooth and as professional as possible. The transaction we just described is an example of how we look out for our clients.

Give us a call.

 

WHY BUY NOW? MORTGAGE RATES ARE DOWN AND YOUR RENTERS ARE WAITING

Should you buy that new home or investment property now?  Well, if you're looking for a good deal, you should consider it. According to the Wall Street Journal (January 14, 2011), mortgage rates have actually declined for the second consecutive week. The average 30-year fixed-rate mortgage fell to 4.71% in the week ending Thursday, reaching a four week low, according to Freddie Mac.

This surprising, but probably temporary, reduction in rates may be your last chance to cash in on the ridiculously-low rates which are now available.

Another good reason to buy investment property right now is the dramatic rise in the number of potential renters. The predicted 4000 local families which will probably lose their homes to foreclosure in 2011 will soon be in the market for high-quality rentals. Therefore we will need between 2000-3000 additional rental units to service this need. This will be a great opportunity for residential real estate investors. These unlucky people who may have been forced into foreclosure because of lost jobs are otherwise-reliable families who are used to taking care of their homes and expect the best for their families. These displaced homeowners have already reduced the vacancy rate in Colorado Springs to below 6% (Before the recession, our vacancy rate was running around 10%). Investors report that these new renters are trouble free, pay on time and take good care of their rentals.    

Call us to discuss this great opportunity.

 

LATEST STATISTICS

Click here to see the latest Sales and Listing statistics for the Pikes Peak area.

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 38 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 young Realtor had just started his own real estate office. He rented a beautiful office and had it furnished with antiques.

Sitting there, he saw a man come into the outer office. Wishing to appear the hot shot, the broker picked up the phone and started to pretend he had a big deal working.

He threw huge figures around and made giant commitments. Finally he hung up and asked the visitor, "Can I help you?"

The man said, "Yeah, I've come to activate your phone lines."

 

The MID is being challenged

by Harry Salzman

Jan. 10, 2011

HARRY’S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTAIL real estate MARKET

 

HOW ARE WE DOING ?

How is real estate doing now, compared with last month? How did we do in 2010, compared with 2009? How is the Pikes Peak area doing compared with the rest of the country? Well, the two links, below will allow you to examine the sales numbers for 2010 and will demonstrate that our median and average prices are up!!! That’s great news.

But the most encouraging statistics involve appreciation. In their survey of the largest U.S. metropolitan, NAR reports a national decline of .2% in home prices. Our local market, on the other hand, shows an increase of 4.4% in home prices. That’s a great indication that the Colorado Springs market has bottomed out and is on the way back up.

Click here for the latest monthly Sales and Listing statistics for the Pikes Peak area and Click here for the Annual statistics.

Things are definitely looking up.

 

THE MORTGAGE INTEREST DEDUCTION IS BEING CHALLENGED !!!

There has been much discussion in Washington lately about eliminating the deduction for mortgage interest (MID).  The National Commission on Fiscal Responsibility and Reform has suggested that this deduction should be eliminated. We think this move would be disastrous to our economy.

Changing the mortgage interest deduction (MID) will have a long-range ripple effect on everyone, including the nation's 75 million homeowners,with the most immediate impact on the 47 million homeowners who currently take the deduction.

For financially-strapped taxpayers, the ability to deduct the interest paid on a mortgage can mean significant savings at tax time. In 2008, the mortgage interest deduction represented roughly $11,593 for the average taxpayer who had a mortgage. Assuming a marginal tax rate of 25 percent (tax bracket), that mortgage interest deduction translates into an actual savings of $2,898 for the average taxpayer, according to analysis by the National Association of REALTORS® (NAR).

As a specific example, a family who bought a home last year with a $200,000, 30-year, fixed-rate mortgage, assuming an interest rate of 5 percent, could save nearly $3,500 in federal taxes when they file next year. That’s real money they can use to pay down other debts, save for their children’s college education, or put away for retirement.

Diminishing this vital public investment in our housing economy will put downward pressure on prices at a time when the housing market cannot take that kind of hit. Any reduction in the mortgage interest deduction will put us in a broader economic recession, according to NAR Chief Economist Lawrence Yun. He has projected that home values could fall 15 percent nationwide as buyers discount the value of the MID in their purchase offers

The tax deductibility of interest paid on mortgages is a powerful incentive for homeownership and has been one of the simplest provisions in the federal tax code for more than 80 years. In a new survey of nearly 3,000 homeowners and renters commissioned by NAR and conducted online in October 2010, nearly three-fourths of homeowners and two-thirds of renters said the mortgage interest deduction was extremely or very important to them.

Let’s not forget that Homeownership also provides real financial benefit to families as a vehicle for personal savings, wealth creation and of financial advancement. Millions of middle-class homeowners and those that aspire to be homeowners rely on the MID to make homeownership affordable.

And homeownership also benefits communities. People who own their homes vote more, volunteer more and participate more in community initiatives, providing resources and stability to neighborhoods across America.

And, just to clear the record, let’s look at a common misperception that the mortgage interest deduction benefits primarily the wealthy, as argued in the Washington Post’s January 1 editorial, “Trim the Excessive Tax Subsidy for real estate.” In fact, the MID actually benefits primarily middle- and lower income families. Sixty five percent of families who claim the MID earn less than $100,000 per year, and 91 percent who claim the benefit earn less than $200,000 per year. As a percentage of income, the biggest MID beneficiaries are younger middle-class families.

Homeownership has been a boon to our nation - one that policymakers have long supported. Historically, the real estate industry has generated between 15 and 18 percent of the gross domestic product Eliminating or diminishing the mortgage interest deduction, as recently proposed by the National Commission on Fiscal Responsibility and Reform, is a policy mistake that would stop the housing recovery in its tracks, undermine a cornerstone of our economy and chill consumer behavior for years to come.

As we face up to our mounting deficit, we have to be careful not to stifle markets that generate significant economic activity and have a positive impact on the revenue side of the equation. Let’s not mess with Homeownership - that crucial element in our economic recovery.

Please, Washington, let’s not tamper with the deduction for mortgage interest.

 

THE REALITIES OF FORECLOSURE

Unfortunately, foreclosures are still growing but most homeowners don’t understand the realities of exactly what the decision to walk away from their mortgages will mean to their finances and to their futures.

So, before you decide to go through foreclosure, you should consider a couple of other options:

  • Short sale:  Both you and your lender must agree to a short sale. ..i.e. selling your home at a moderate loss, avoiding foreclosure and its associated fees and, hopefully, salvaging your credit report
  • Talking with your lender: Most banks don’t want you to foreclose, as it would mean they take a loss. So, they may be able to offer you programs, refinancing, or counseling that that might help you avoid losing your home.
  • Selling if you are not underwater: If you don’t owe more than you can sell for, then now is the time to call a Realtor. Downsizing or even renting are better options than ruining your credit for the next seven years.

If none of these options work for you, then be aware of some of the myths that surround the foreclosure process. To shed light on what a foreclosure will mean to a homeowner, Freddie Mac offers "Top Foreclosure Myths" and the truth behind those false beliefs. For example:

• Myth: You should stop paying your mortgage so you can leverage assistance with your mortgage payments.

The approach, called a "strategic default," can become a tactical trap.

It isn't necessary to default on your mortgage payments in order to qualify for help.

If you are struggling to stay current on your mortgage, you may be eligible for a loan modification or other assistance program.

You signed a contract that binds you to making regular mortgage payments. If you don't make your payments, you will be exposed to foreclosure, subsequent black marks on your credit report and years of financial recovery.

If you can financially afford to make your mortgage payments, even if you've been declined a mortgage modification , short sale or other work out, do so to maintain your credit standing.

If you need help, contact us. We will be happy to discuss your situation and your options.

• Myth: After a foreclosure, you'll never get another mortgage.

Well, sure. You blew it. Perhaps you borrowed more than you could afford or your ability to pay for what you thought you could afford went away. You may not qualify for a home for as long as seven years, but that's not "never."

Work to create a spending and savings plan that will rebuild your credit. Get approved counseling that will reveal your effort to recover.

• Myth: Workout options are over once you get a foreclosure notice.

Lenders would prefer that you keep your mortgage and continue to make payments because they lose money when they foreclose on you. Even if foreclosure proceedings have begun, it's not too late to be considered for a workout or other alternative.

• Myth: You need to leave your home as soon as you're notified that your property is in foreclosure.

A notice of foreclosure is the first step in the foreclosure process. There are procedural and legal guidelines and applicable state and federal laws that servicers and lenders must follow in every foreclosure. Foreclosures take months to complete.

• Myth: If you're late on your monthly payments, you'll lose your house.

You will if you stick your head in the sand. If you have a financial hardship and fall behind, it's possible to keep your house and get back on track if you tell someone who is able to help. Contact your lender to discuss your options.  

• Myth: All the offers for help are probably all scams.

Scam artists do often target homeowners who are struggling to meet their mortgage commitment or who are anxious to sell their home.

Deal with your lender first, rather than an outside party. If you do deal with an outside firm avoid those that ask for a fee in advance to work with your lender to modify, refinance, or reinstate your mortgage. Ignore guarantees from outside firms that claim they can stop a foreclosure or modify your loan.

Legitimate offers will have specific information identifying your current mortgage, including the loan number of your mortgage. Shy from offers that come from a company other than your current lender or an authorized agent of your lender.

• Myth: Give up if your lender is not responding to your inquiries.

Never give up. Lenders are deluged. It may take longer than you'd like to reach your lender, which is why you should contact your lender at the first sign of trouble. The process of obtaining a loan modification or other foreclosure alternative may require diligence in the form of multiple calls and multiple submissions of documents between you and your lender. The process isn't perfect, the procedures continue to change.

If you’re facing foreclosure, remember, it’s not the end of the world; it’s just a new page in the story of your life. Don’t forget, Abraham Lincoln was defeated in his first five attempts to be elected to public office.

The moral of the story: Hang in there …and don’t go to the theater.

 

WANT TO MAKE MONEY LIKE WARREN BUFFETT ? BUY A SECOND HOME

In the Winter Edition of Bottom Line, the author discusses how Warren Buffett takes advantage of the opportunities that a “down market” offers. One of the tips Mr. Buffett lists is to take advantage of the current slowdown in the real estate market by buying a second home.

As Mr. Buffett points out, “Over the long term, the American economy is strong and resilient, which causes stocks (and real estate values) to go up”.

Sounds like a good idea. Call us.

 

JOKE OF THE WEEK

SOME THOUGHTS ABOUT OUR RECENT FOOTBALL SEASON

Mike Singletary is reported to be moving to Denver. He says he wants to get as far away from football as he can.

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On the latest Wheaties box, General Mills is running a contest where you can win tickets to the Super Bowl next year. The fine print states the odds of going to the Super Bowl are about 460,000 to 1. Funny, that’s about the same odds as for the Broncos going.

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Q. What do you call 50 people sitting around a TV watching the Super Bowl?

A, The Denver Broncos

 

Q. Where do the Broncos go in case of a tornado?

A. Mile-High Stadium. They never get a touchdown  there.

 

Q. How many Broncos does it take to change a flat?

A. Only one, unless it's a blowout -- then the whole team shows up.

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Three guys from Colorado died and went to heaven. At the pearly gates, they were met by St. Peter, who explained that although it was late and God had retired for the evening, he had asked Albert Einstein to show them around so they wouldn't get bored before they met God in the morning.

After Einstein had introduced himself to Slim, he asked, "By the way, Slim, what was your IQ when you were alive?"

"159", said Slim.

"Great!", said Einstein. We'll discuss my general theory of relativity and maybe a little unified field theory as I show you around."

"What an exciting opportunity!", said Slim.

Einstein then introduced himself to Billy-Bob, and when he was done he said, "Tell me, Billy-Bob, what was your IQ when you were alive?"

"141", said Billy-Bob.

"Good," said Einstein. "If you'd like, we can discuss a little mathematics and philosophy as I point out the heavenly sights."

"Nothing I'd like better!" was Billy-Bob's reply.

After Einstein had introduced himself to Bubba, he asked, "What was your IQ when you were alive, Bubba?"

"Duh. Huh?" said Bubba.

Punching him on the arm, Einstein said, "Hey, Bubba - How 'bout them Broncos?

PLAY BALL .....BATTER UP !!!

by Harry Salzman

October 25, 2010

HARRY'S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTIAL real estate MARKET

 

HEY, COLORADO SPRINGS ..IT'S 2011 ....IT'S A NEW BALLGAME .BATTER UP !!!

As we begin 2011, we citizens of Colorado Springs have a great opportunity to start a whole new ballgame. Elections for the new city council come up on April 5th and we will also have the opportunity, for the first time, to vote for a full-time mayor. This election represents a whole new beginning for our city.

This new beginning comes at a time when everyone agrees that jobs will be the key to our future success as a city. Jobs will generate economic growth, rebuild the housing market, stimulate spending, promote a healthy economy, increase our tax revenues and boost everyone's morale. Unfortunately, in 2011, there will be many other cities competing with us for the attention of job-generating new businesses.

With that in mind, we would like to encourage our readers to take an increased interest in our upcoming elections. Be sure to ask all candidates for office about their specific plans for attracting new businesses to our city. This is our chance to find out exactly what each candidate plans to do to increase employment opportunities in the Pikes Peak area. Yes, yes, we know that every candidate loves the flag and Mom's apple pie, but, how do they plan to beat our competition in this fight for jobs. What innovative plans do the candidates have for "selling" our city, promoting our unique lifestyle and beauty, bringing our budget problems to an end, improving services, enhancing our national image, encouraging growth, etc., etc., etc.

The candidates we end up choosing should be the ones who have some innovative solutions for winning this fight for jobs.

It may be a little early for traditional Spring training to begin, but, in the case of our city's upcoming elections, it's not too early to start planning for the first game of the season.

Play ball !!!   Batter up !!! 

 

WANT TO BEAT THE STOCK MARKET?  .BUY A HOUSE

We frequently hear from people who express reluctance to buy a new home right now. Considering the turmoil that the real estate market is currently going through, they are not sure that owning a home would be a good business decision.

Well, let's look at the historical facts about home ownership in Colorado Springs over the past ten years. In December of 2000, the median sales price of homes in Colorado Springs was $145,000. At the end of December 2010, the median sales price was $198,000. That difference of $53,000 represents a gain of 3.66% per year, over each of the past ten years. In addition to this increase in market value, the Homeowner also benefited from such factors as an increase in equity, significant tax benefits, etc.

If, instead of buying a house ten years ago, the investor had bought stocks, the Dow Jones Industrial average shows that, over the past ten years, his/her investment would have shown a total increase of 1.06% ..that's not per year, that's total increase.

Bottom line: Over the long haul, buying a home is a much better investment that investing in the stock market. Furthermore, with the still-low interest rates that are now available, there is even more reason to buy now. (And, if you are concerned about job security, please call us about our Job-Loss Protection Program)

 

WHAT DO THE EXPERTS SAY ABOUT real estate IN 2011?

In an interview on December 30, 2010, Lawrence Yun, Chief Economist for the National Association of Realtors, made the following predictions about the real estate market in 2011:

"Steady improvements in the economy are helping bring buyers into the market, but further gains are needed to reach normal levels of sales activity.

"If we add 2 million jobs as expected in 2011, and mortgage rates rise only moderately, we should see existing-home sales rise to a higher, sustainable volume.

"All the indicator trends are pointing to a gradual housing recovery. Home price prospects will vary depending largely upon local job market conditions. The national median home price, however, is expected to remain stable even with a continuing flow of distressed properties coming onto the market, as long as there is a steady demand of financially healthy home buyers.

"As we gradually work off the excess housing inventory, supply levels will eventually come more in-line with historic averages, and could allow home prices to rise modestly in the range of 2-3% in 2011.

As we said in our first article, Jobs will determine the speed with which we recover from the recession.

  

LATEST STATISTICS

Click here to see the latest Sales and Listing statistics for the Pikes Peak area

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 balloonist is blown off course and is forced to land. He is in a field close to a road, but has no idea where he is. He sees a car coming along the road and hails it.

The driver gets out and the balloonist says, "Howdy! Can you tell me where I am?"

"Yes, of course," says the driver. "You have just landed in your balloon, and with this wind you have obviously been blown off course. You are in the top field on John Dawson's farm, 12 miles from Albury. John will be plowing the field next week and sowing wheat. There is a bull in the field. It is behind you and about to attack you."

At that moment, the bull reaches the balloonist and tosses him over the fence.

Luckily, the balloonist is unhurt. He gets up, dusts himself off and says to the motorist, "I see you're an appraiser for a bank"

"Good grief," says the other man, "you're right! How did you know that?"

"I'm a Realtor and I work with bank appraisers all the time." says the balloonist. "The information you gave me was detailed, precise, and accurate. Most of it was useless, and it arrived far too late to be of any help."

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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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