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IT;S TIME TO STOP BEING A MUGWUMP

by Harry Salzman

March 26, 2012
HARRY’S WEEKLY UPDATE

LOCAL ECONOMY GAINING JOBS IN PAST 18 MONTHS
The Gazette, Saturday, March 24, 2012

Thought the unemployment rate in the Colorado Springs area remains at a stubborn 9%, there is good news. The local economy has been adding jobs, rather than losing them, according to the revised payroll data released Friday by the U.S. Bureau of Labor Statistics.

The revisions add more than 4,600 jobs per month to last year’s employment totals and reflect a local economy that began recovering from the most recent recession in late 2010, said Tom Binnings, a senior partner of Summit Economics, LLC, a Colorado Springs-based economic research and forecasting firm.

“This is what we were forecasting for last year but wasn’t reflected in the survey numbers, that the economy was much better than was estimated by BLS. We are very pleased that the local economy is gaining traction.’ Binnings said.

“If you look at the other economic indicators for the area,such as sales tax collections, vehicle sales and housing construction, they support that employment was higher than originally reported”, said Fred Crowley, senior economist for the Southern Colorado Economic Forum.

“All indications ar that the local economy is in recovery after bottoming out in early 2009 and has been moving forward at a faster pace than it originally appeared to be”, Crowley said.

That’s good news for our area !!!!


BUYING BEATS RENTING IN COLORADO SPRINGS
by Inman News, Thursday, March 22, 2012.

Thanks to nationwide price declines and rising rents, buying a home is now cheaper than renting one in 98 of the nation's 100 major metropolitan areas, according to a rent vs. buy index from real estate search and marketing site Trulia.

The rent vs. buy index is based on a price-to-rent ratio of asking prices to asking rents for properties on Trulia.com between Dec. 1, 2011 and Feb. 29. 2012, after adjusting for property and neighborhood attributes.

A price-to-rent ratio of 15 or below indicates it is less expensive to buy than to rent in an area.
The top 10 metro areas where it is cheaper to buy than to rent are:

Rank US Metro Price:Rent Ratio

1 Honolulu 17
2. San Francisco 15.5
3. New York 14.5
4. San Jose, CA 14.3
5. Orange County, CA 13.5
6. Los Angeles, CA 13
7 San Diego, CA 12.7
8. Colorado Springs, CO 12
9. Boston, MA 12
10 Albuquerque, NM 11


As rents rise and prices stagnate, homeownership is becoming even more affordable, but rising rents create a dilemma for people who can’t afford to buy yet,” says Jed Kolko, Trulia’s chief economist. “Rising rents make it harder for people to save for a down payment, which is the biggest barrier to buying a home that aspiring homeowners face.”

Paul Dales, senior economist at Capital Economics, estimated decreased vacancies in the home-rental market will push average rental rates up as much as 5% by early 2013, compared to 2.4% in January.

He expects rents to rise at an annual rate of 3% this year and remain at that level in 2013. "Assuming that the economic recovery gains firmer footing, in future years there is scope for rents to rise by around 4% a year," Dales said.

The bottom line for our local, Colorado Springs readers is that you should check with us to see if, considering your circumstances and present market conditions, buying might be better for you than renting, or, if your portfolio would profit from purchasing a rental property, we will be pleased to discuss that option with you. Call us at 598-3200,or,1-800-677-MOVE(6683) to discuss these opportunities.


IT’S TIME TO STOP BEING A MUGWUMP

A Mugwump is a bird that sits on a fence with his ‘mug’ on one side and his ‘wump’ on the other.

For the past few years, the real estate market has been full of prospective buyers (Mugwumps) who have delayed their purchasing decision, as they wait for mortgage rates to go even lower.

Well, folks, if you have been a Mugwump, it’s now time to get off the fence. All the evidence points to the fact that rates are not going to go down, but are even now starting to rise.

Within the past week, the Wall Street Journal, DS News, Housingwire and InmanNews have all featrured stories about the rise in mortgage interest rates. In addition to this rise in rates, you have to add in the fact that FHA costs are rising, the inventories of available homes is shrinking and, in many markets, credit scores are beginning to present problems for prospective buyers.

Locally, Tom Monroe of Residential Mortgage of Colorado LLC just quoted me some current data that emphasize this trend. For example:

• A 30-year, fixed rate, conventional mortgage, with a minimum 20% down payment is now going for around 4.375% - 4.5%....That still extremely low, but it’s higher than it was two weeks ago
• A 15 year, fixed rate, conventional mortrgage is now about 4.0%
• A 30 year, fixed rate for an FHA mortgage is now about 4%
• Our inventory of available homes is shrinking, and, as we all know, when supply shrinks, prices tend to rise.

real estate agents also see the lack of inventory as a problem . The number of homes for sale is down sharply from a year ago. That may stem partly from would-be sellers waiting for prices to firm up.

We strongly urge you to contact your local lender to see how the recent changes in rates, closing costs and FHA fees might affect your loan …and then call us for assistance in getting the best deal possible on your new home.

Call us at 598-3200, or, 1-800-677-MOVE(6683) to discuss the present opportunity for you to buy your home….and leave the other Mugwumps on the fence !!!


FEBRUARY NATIONWIDE HOME SALES UP STRONGLY FROM A YEAR AGO

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, are 8.8 percent higher than the level in February 2011.

Lawrence Yun, NAR chief economist, says underlying factors are much better compared to one year ago. “The market is trending up unevenly, with record high consumer buying power and sustained job gains giving buyers the confidence they need to get into the market,” he says. “Although relatively unusual, there will be rising demand for both rental space and homeownership this year. The great suppression in household formation during the past four years was unsustainable, and a pent-up demand could burst forth from the improving economy.”

“The bottom line is investors and first-time buyers are competing for bargain-priced properties in much of the country, with home prices showing signs of stabilizing in many areas. People realize that homeownership is an investment in their future. Given an apparent over-correction in most areas, over the long term home prices have nowhere to go but up.”

Call us at 598-3200, or, 1-800-677-MOVE(6683) to discuss the present opportunity for you to buy your home.

CONSUMER CONFIDENCE RISES NATIONALLY

A new national survey released by Prudential, shows that Americans are significantly more optimistic about home ownership than they were a year ago. According to the survey, a full 60 percent of Americans have favorable views toward the real estate market. That is up eight points since last year.
More details from the national Prudential Survey:

• With interest rates at historically low levels, 96 % agree or somewhat agree that now is a good time to buy.
• A full 70 % of respondents have some degree of confidence that property values will improve over the next two years; with an eight-point increase in those “very confident”, or “confident” compared to last year.
• 63 % believe that real estate is a good investment despite the recent market volatility; that is up 11 points from last year.

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

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 39 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.

Just click on the icon at the top of this email to listen to my latest podcast.

LATEST STATISTICS

Click here for the latest Sales and Listing statistics for the Pikes Peak area. These statistics are issued each month by the Pikes Peak Association of Realtors and enable us to help you determine current Listing prices and Sales prices in every neighborhood in this area. Please give us a call, if you have any questions about the numbers.


JOKE OF THE WEEK

OK, we know that some people are offended by ‘blonde jokes’, so we have edited the following to refer to ‘Green-Haired-Ladies’ (GHL). There, now. Nobody has to be offended, so just enjoy!!!

FIRST DEGREE
A married couple were asleep when the phone rang at 2 in the morning.
His GHL wife picked up the phone, listened a moment and said 'How should I know,
that's 200 miles from here!' and hung up. The husband said, 'Who was that?'
The wife answered, 'I don't know, some woman wanting to know if the coast is clear.'

SECOND DEGREE
Two GHLs are walking down the street. One notices a compact on the sidewalk and leans down to pick it up. She opens it, looks in the mirror and says, 'Hmm, this person looks familiar.'
The second GHL says, 'Here, let me see!' So, the first GHL hands her the compact.
The second GHL looks in the mirror and says, 'You dummy , it's me!'

THIRD DEGREE
A GHL suspects her boyfriend of cheating on her, so she goes out and buys a gun. She goes to his apartment unexpectedly and when she opens the door she finds him in the arms of a redhead. Well, the GHL is really angry. She opens her purse to take out the gun, and as she does so, she is overcome with grief. She takes the gun and puts it to her head. The boyfriend yells, 'No, honey, don't do it!!!' The GHL replies, 'Shut up, you're next!'

FOURTH DEGREE
A GHL was bragging about her knowledge of state capitals. She proudly says, 'Go ahead, ask me, .. I know 'em all.' A friend says, 'OK, what's the capital of Wisconsin ?'
The GHL replies, 'Oh, that's easy . it's W.'

FIFTH DEGREE
Q: What did the GHL ask her doctor when he told her she
was pregnant? A: 'Is it mine?'

SIXTH DEGREE
Bambi, a GHL in her fourth year as a UCLA Freshman, sat in her US Government class The professor asked Bambi if she knew what Roe vs. Wade was about. Bambi pondered the question; then, finally, said, 'That was the decision George Washington had to make before he
crossed the Delaware .'

SEVENTH DEGREE
Returning home from work, a GHL was shocked to find her house ransacked and burglarized. She telephoned the police at once and reported the crime. The police dispatcher broadcast the call on the radio, and a K-9 unit, patrolling nearby, was the first to respond. As the K-9 officer approached the house with his dog on a leash, the GHL ran out on the porch, shuddered at the sight of the cop and his dog, then sat down on the steps. Putting her face in her hands, she moaned, 'I come home to find all my possessions stolen. I call the police for help, and what do
they do? They send me a BLIND policeman!'

COLORADO SPRINGS JOB MARKET IS LOOKING HEALTHIER

by Harry Salzman

March 19, 2012

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


COLORADO SPRINGS JOB MARKET IS LOOKING HEALTHIER
The Gazette: March 12, 2012

The job market outlook in the Colorado Springs area for the second quarter is among the best in the past 3 ½ years,
according to a quarterly employment survey by temporary staffing giant Manpower.

The area’s outlook for the April-June quarter ranks among the top third of the nation’s 100 largest metropolitan areas, with
19% of local employers planning additional hiring.


NEW SURVEY SHOWS AMERICANS UPBEAT ABOUT HOME VALUES
Daily real estate News: Friday March 16, 2012

The latest Outlook Survey shows that 70% of Americans say they are confident that property values will rise within the next two years. Furthermore, 63% say that they still view real estate as a good investment.

96% of the 1000 people surveyed (these are people who are in the market to buy or sell a home) say that now is a good time to purchase a home.

We couldn’t agree more !!! Low mortgage interest rates, low prices and a good inventory of available homes to choose from all add up to a great opportunity for Buyers. …Call us to cash in on this ‘once-in-a-lifetime’ market.

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


HOUSING STARTS INDICATE THAT HOUSING MAY BOOST THE ECONOMY IN 2012
Bloomberg Businessweek: March 18, 2012

Spurred by rising employment and record-low mortgage rates, buyers are wading back into the market. Indicators are that housing may become a major net-contributor to the U.S. economy for the first time since 2006.

Peter de Bruin, an economist with ABN Amro Group, has been the most accurate forecaster of new-home sales in the two years ended Feb. 1, 2012, states that, “Housing will contribute modestly to recovery this year, and we will see a sustained recovery in 2013 through 2015.”

Existing-home sales reached their fastest pace in 20 months in January and more Americans that forecast signed contracts to buy, according to NAR.

Some of the upbeat data in the Bloomberg Businessweek article show that housing starts are up 20%, Homebuilder confidence is up 122%, and the increase in lumber moved by railcar was 26%.

That’s the good news …The bad news is that, if you wait much longer to buy your new home, inventory will be smaller, thus forcing prices up, and rates will be higher, thus forcing monthly payments up. (The Department of Numbers Website reports that, in the 146 major metro areas it tracks, Sellers’ asking prices were up 3.69% on the year. This marks the first time in six years that the numbers have gone positive).

The bottom line: Buy now. Call us at 598-3200, or, 800 677-6683 (MOVE).


NOW IS A GOOD TIME TO THINK ABOUT BUYING A RENTAL PROPERTY

Fannie Mae’s February 2012 National Housing Survey shows that both renters and landlords expect home prices and rents to increase over the next 12 months.

On average, the survey respondents expect home rental prices to increase by 3.5% over the next 12 months.

In fact, the Wall Street Journal (Monday, March 19, 2012) reports that some of the biggest names on Wall Street are lining up to become landlords by bidding on pools of foreclosed properties being sold by Fannie Mae.

WSJ goes on to point out that rentals promise a relatively high rate of return compared with other investments right now.

Warren Buffett, considered a sage investor and chief executive of Berkshire Hathaway, Inc. said in an interview with CNBC-TV last month that he would buy up “a couple hundred thousand” single-family homes, given the high yields on rental investments.

Bottom line: You can buy a rental property today for less than it will cost you tomorrow, and the income you derive from that property will increase every year.

Call us at 598-3200, or, 800 677-6683 (MOVE), to discuss how you can take advantage of the current opportunity to add rental income to your investment portfolio.


FRONTIER AIRLINES TO INCREASE DIRECT FLIGHTS FROM COLORADO SPRINGS
The Colorado Springs Business Journal – March 22, 2012

Frontier Airlines has named Colorado Springs as one of their first ‘focus cities” and will start four non-stop flights out of the Colorado Springs airport in May. The target cities for the flights will be Phoenix, Los Angeles, Portland and Seattle.

The new flights will feature the 138-seat Airbus A319 and Frontier will lower ticket prices, so they can fill the planes.

Frontier already has strong bookings on the new flights and has stated they are impressed with the direct bookings and are very excited about the new flights.

The Colorado Springs Economic Development Corps is also very excited about the news and feels they will assist them in their effort to attract new businesses to our city.

These new flights will be more efficient for the business traveler and will make our local ticket prices competitive with Denver airline prices. As other airlines adjust their prices to compete, ticket prices for other local flights should also go down.
This is another piece of good news for our area and demonstrates that our local economy is getting better every day.


MORTGAGE RATES INCH UP ON POSITIVE ECONOMIC DATA
Housingwire: March 15,2012

Freddie Mac announced that mortgage rates rose across the board this past week on positive jobs data and increasing bond yields

The 30-year, fixed-rate mortgage hit 3.92% for the week ending March 15, up from 3.88% the previous week (and down from 4.76% a year ago).

So, “times a’wastin”.. Don’t wait for rates to go down any further. It looks like, as the economy recovers, mortgage rates are starting to go up.


HOME PURCHASES IN FEBRUARY IN THE U.S. CLIMBED TO HIGHEST LEVEL IN TWO YEARS
Bloomberg News, March 18, 2012

Home purchases in the U.S. probably climbed in February to the highest level in almost two years, another sign of stabilization in the real-estate market, economists said reports this week will show.

Combined sales of new and previously owned properties rose to 4.93 million at an annual rate, the strongest since May 2010, from 4.89 million in January, according to the median forecasts in a Bloomberg News survey.

Job and income gains, cheaper homes and the lowest mortgage rates on record have combined to push affordability to an all- time high. With fewer new dwellings on the market, residential construction may be poised to contribute more to economic growth this year.

“The evidence is very clear that housing is beginning to improve,” said Russell Price, a senior economist at Ameriprise Financial Inc. in Detroit. “I do not expect housing to be a drag on GDP this year. It started to be a modest positive contributor last year. Now that it’s actually contributing again, that’s a significant turn of events.”

The National Association of Realtors will release its existing-home sales data on March 21. Purchases increased 0.7 percent to a 21-month high 4.6 million at an annual rate, after a 4.57 million pace in January, according to the Bloomberg survey median.

Sales of new homes in February climbed to a 325,000 annual rate, the fastest since December 2010, from 321,000 the prior month, the survey median showed. The report is due from the Commerce Department on March 23.

The improvement in the labor market has contributed to the recent housing gains. Payrolls rose in February, capping the best six-month increase since 2006, while the jobless rate held at a three-year low, according to Labor Department figures.

Housing Starts

Builders in February broke ground on 700,000 homes at an annual pace, the most in three months, economists said ahead of March 20 figures from the Commerce Department. That same report may show the strongest pace of building permits, a sign of future construction, since March 2010.

“All the economic signs seem to be positive in terms of consumer confidence, interest rates, unemployment levels,” Martin Connor, chief financial officer at Toll Brothers Inc., said March 5 at a investors’ conference in Orlando, Florida.

The average rate on a 30-year fixed mortgage reached an all-time low of 3.87 percent in February, according to data from Freddie Mac.

A measure of housing affordability a month earlier climbed to 206.1, according to the National Association of Realtors. A value of 100 means that a family with the national median income has enough to qualify for a median-priced property.

WOW !!!! How much good news can we take?

 

SALES AND LISTING STATISTICS

CLICK HERE for the latest Sales and Listing data on the Pikes Peak area from the Pikes Peak Association of Realtors.

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

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 39 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf. Call us at 598-3200,or, 800 877-MOVE (6683).


JOKE OF THE WEEK

Hollywood Squares:
These great questions and answers are from the days when ' Hollywood Squares' game show responses were spontaneous, Not scripted, as they are now. Peter Marshall was the host asking the questions, of course..

Q.. Paul, what is a good reason for pounding meat?
A. Paul Lynde: Loneliness! (The audience laughed so long and so hard it took up almost 15 minutes of the show!)

Q.. Do female frogs croak?
A. Paul Lynde: If you hold their little heads under water long enough.

Q. If you're going to make a parachute jump, at least how high should you be
A. Charley Weaver: Three days of steady drinking should do it..

Q.True or False, a pea can last as long as 5,000 years...
A. George Gobel: Boy, it sure seems that way sometimes.

Q.You've been having trouble going to sleep. Are you probably a man or a woman?
A.. Don Knotts: That's what's been keeping me awake.

Q. According to Cosmopolitan, if you meet a stranger at a party and you
think that he is attractive, is it okay to come out and ask him if he's married?
A.. Rose Marie: No wait until morning.

Q.Which of your five senses tends to diminish as you get older?
A. Charley Weaver: My sense of decency..

Q.In Hawaiian, does it take more than three words to say 'I Love You'?
A. Vincent Price: No, you can say it with a pineapple and a twenty..

Q.What are 'Do It,' 'I Can Help,' and 'I Can't Get Enough'?
A. George Gobel: I don't know, but it's coming from the next apartment.

Q.As you grow older, do you tend to gesture more or less
with your hands while talking?
A.Rose Marie: You ask me one more growing old question Peter,
and I'll give you a gesture you'll never forget.

Q..Paul, why do Hell's Angels wear leather?
A. Paul Lynde: Because chiffon wrinkles .

Q..Charley, you've just decided to grow strawberries.
Are you going to get any during the first year?
A.. Charley Weaver: Of course not, I'm too busy growing strawberries.

Q.In bowling, what's a perfect score?
A. Rose Marie: Ralph, the pin boy.

Q. It is considered in bad taste to discuss two subjects at nudist camps... One is politics,
what is the other?
A. Paul Lynde: Tape measures..

Q.During a tornado, are you safer in the bedroom or in the closet?
A. Rose Marie: Unfortunately Peter, I'm always safe in the bedroom.

Q.Can boys join the Camp Fire Girls?
A.. Marty Allen: Only after lights out.

Q.When you pat a dog on its head he will wag his tail.
What will a goose do?
A. Paul Lynde: Make him bark?

Q.If you were pregnant for two years, what would you give birth to?
A. Paul Lynde: Whatever it is, it would never be afraid of the dark..

Q.According to Ann Landers, is there anything wrong with getting into
the habit of kissing a lot of people?
A. Charley Weaver: It got me out of the Navy!

Q. Back in the old days, when Great Grandpa put horseradish on his head,
what was he trying to do?
A. George Gobel: Get it in his mouth.

Q.Who stays pregnant for a longer period of time, your wife or your elephant?
A. Paul Lynde: Who told you about my elephant?

Q. When a couple have a baby, who is responsible for its sex?
A... Charley Weaver: I'll lend him the car, the rest is up to him

Q.Jackie Gleason recently revealed that he firmly believes in them and has
actually seen them on at least two occasions What are they?
A. Charley Weaver: His feet.

Q.According to Ann Landers, what are two things you should never do in bed?
A. Paul Lynde: Point and laugh

WE DON'T STOP LAUGHING BECAUSE WE GROW OLD,
WE GROW OLD BECAUSE WE STOP LAUGHING

 

March 12, 2012


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


GOOD NEWS !!! COLORADO SPRINGS HOMES SELLING BETTER IN 2012 THAN LAST YEAR
The Gazette, Wednesday Mar. 7, 2012

The Gazette reports that local home sales hit 514 in February, 2012. This represents a 14.7% rise in sales over 2011 and marks the 8th straight month of increasing local sales. So far in 2012, our local housing market has shown an 8.8% rise in the number of sales over the same period last year.

Considering the fact that this is an election year, it is very likely that the government will take whatever actions are necessary to boost home prices during the rest of the year. So, with higher prices, low rates, shrinking inventory ….If you have been on the fence about buying or selling your home, now is certainly the time to make your move.

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


HOUSING AFFORDABILITY REACHES NEW RECORD HIGH

Housing affordability rose to a record high during the fourth quarter of 2011, which means that a home buyer’s purchasing power is greater than it has ever been since record-keeping began in 1970, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index.

NAR’s Housing Affordability Index rose to a record high 206.1 in January, based on the relationship between median home price, median family income and average mortgage interest rate. The higher the index, the greater the household purchasing power.

An index of 100 is defined as the point where a median-income household has exactly enough income to qualify for the purchase of a median-priced existing single-family home, assuming a 20 percent down payment and 25 percent of gross income devoted to mortgage principal and interest payments. For first-time buyers making small down payments, the affordability levels are relatively lower. Based upon these parameters, the Index showed that 75.9% of all new and existing homes sold in the fourth quarter were affordable to families earning the national median income of $64,200. This marks the highest percentage recorded in the index’s 20-year history.

NAR President Moe Veissi, said this latest data underscores buyer opportunities in today’s market. “This is the first time the housing affordability index has broken the two hundred mark, meaning the typical family has roughly double the income needed to purchase a median-priced home,” he said. “For buyers who can qualify for a mortgage, now is a very good time to become a homeowner.”

NAR projects the affordability index for all of 2012 will be at an annual high, with little movement in mortgage interest rates or home prices during the year. “Housing inventory levels have declined to a point where conditions are becoming much more balanced in much of the country,” Veissi said. “If access to credit improves, we could see a much more meaningful increase in home sales and broader stabilization in home prices with modest gains in areas with stronger job growth.”

Considering today’s low prices, low mortgage-interest rates and high inventories of available homes, it’s obvious that now is the time to buy your new home, or to acquire that rental property.

Call us at 598-3200, or, 800-677-6683, to discuss this opportunity.

 

WHAT YOU NEED TO KNOW ABOUT CANCELATION OF MORTGAGE DEBT
By Linda Goold, Tax Counsel for National Association of REALTORS®.

A lender will, on occasion, forgive some portion of a borrower’s debt. The general tax rule that applies to any debt forgiveness is that the amount forgiven is treated as taxable income to the borrower. Some exceptions to this rule are available, but, until recently, the borrower was required to pay tax on the debt forgiven. A new law enacted in December 2007 provides relief to troubled borrowers when some portion of mortgage debt is forgiven. However, this relief expires on December 31, 2012 and NAR will be working to obtain an extension throughout the year.

Below is some general information you need to know about this law and cancellation of mortgage debt.

General Rule for Debt Forgiveness
If a lender forgives some or all of an individual’s debts, the general rule is that the forgiven amount is treated as ordinary income and the borrower must pay tax on the forgiven amount. Exceptions apply for bankruptcy, insolvency and certain other situations, including mortgage debt.

Current Law for Mortgage Debt
(Jan. 1, 2007 through Dec. 31, 2012): A borrower can be excused from paying tax on forgiven mortgage debt. The debt must be secured by a principal residence and the total amount of the outstanding obligation may not exceed the original mortgage amount plus the cost of any improvements.

Does the relief apply only to a sale?
No. The provision has broader application. Lenders might forgive some portion of mortgage debt in a short sale (when value at sale is less than the amount owed) or in a foreclosure where the debt is wiped out. In addition, if a borrower still living in the home is able to make an arrangement with a lender that reduces the principal balance of a mortgage, the amount forgiven in that workout will not be taxed.

Can the homeowners in a short sale or foreclosure claim a loss?
No. The loss is considered a personal loss and is, therefore, ineligible for either capital loss or ordinary loss treatment.

What happens to the seller when mortgage debt is forgiven?
Until January 1, 2013, the homeowner will pay no tax on any forgiven amount.

Does this provision apply to a refinanced mortgage?
Only in limited circumstances. The relief provision can apply to either an original or a refinanced mortgage. If the mortgage has been refinanced at any time, the relief is available only up to the amount of the original debt (plus the cost of any improvements). Tax relief is generally not available for second mortgages or home-equity lines of credit where the funds are not used for home improvement. Any amount that is not eligible for the relief provision will be taxed as ordinary income.

How does the homeowner get the correct information to the IRS?
The lender is required to provide the homeowner and the IRS with a Form 1099 reflecting the amount of the forgiven debt. The borrower/homeowner must file a Form 982 to reflect the amount forgiven and to show the reason why the forgiven amount is not taxable. Any taxable portion of forgiven debt will then be reported on the homeowner’s Form 1040 for the tax year in which the debt was forgiven.

What if a property declines in value but the owner stays in the house?
The provision would not apply. The provision applies only at the time of sale or other disposition or when there is a workout (reduction of existing debt) with the lender.

Do all lenders forgive mortgage debt when property values decline or the home is in foreclosure?
No. Some states have laws that allow a lender to require a repayment arrangement, particularly if the borrower has other assets. Forgiveness of debt is always at the lender’s discretion.


SMALL BUSINESS OWNERS, TAKE NOTE. …CUSTOMERS ARE LOOKING FOR YOU ONLINE
real estate Trends March 11, 2012

As a business owner operating in a local market, the reliance of consumers on their smart phone and tablet devices has put you in the position to capitalize more so than ever before. The way in which the technology, mobile apps and social media have come together has placed the focus on “local” more so than ever before.

A recent study by comScore revealed that 64 percent of tablet owners are searching weekly and 61 percent of smart phone users conduct local searches from their device. In addition, the report shows a 67 percent increase in social network local business searches since 2010. One thing we know about social network users is that they are in large part accessing from their mobile device.

Take for a moment a real life scenario; you’re out to dinner with friends and you mention you are going to need a plumber. Your friend replies, “I know a great company you should work with.” The common practice in many social circles now-a-days is to immediately Google or look up that recommendation through a social network from your mobile device. We’ve all done this in one form or another.

This means that your information not only needs to be accessible and updated in the various business profiles and on maps in engines like Google, Bing and Yahoo, but it also means that the link to your website needs to work on mobile and tablet devices as well as it does on PCs. Your brand and your information need to be consistent no matter the device the consumer is using.

The old days of just advertising your business in the Yellow Pages are gone forever.

 

SALES AND LISTING STATISTICS

Click here to see the latest PPAR statistics regarding area sales and listings And be sure to give us a call, if you have any questions, or would like to discuss these statistics in more detail. Call us at 598-3200, or, 800 677-6683.

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

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 39 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf. Call us at 598-3200,or, 800 877-MOVE (6683).


JOKE OF THE WEEK

RETIRED/BORED HUSBAND

After I retired, my wife insisted that I accompany her on her trips to Target. Unfortunately, like most men, I found shopping boring and preferred to get in and get out. Equally unfortunate, my wife is like most women - she loves to browse. Yesterday my dear wife received the following letter from the local Target:

Dear Mrs. Harris, Over the past six months, your husband has caused quite a commotion in our store. We cannot tolerate this behavior and have been forced to ban both of you from the store. Our complaints against your husband, Mr. Harris, are listed below and are documented by our video surveillance cameras:
• June 15: He took 24 boxes of condoms and randomly put them in other people's carts when they weren't looking.
• July 2: Set all the alarm clocks in Housewares to go off at 5-minute intervals.
• July 19: Walked up to an employee and told her in an official voice, 'Code 3 in Housewares. Get on it right away'. This caused the employee to leave her assigned station and receive a reprimand from her Supervisor that in turn resulted with a union grievance, causing management to lose time and costing the company money.
• August 4: Went to the Service Desk and tried to put a bag of M&Ms on layaway.
• August 14: Moved a 'CAUTION - WET FLOOR' sign to a carpeted area.
• August 23: When a clerk asked if they could help him he began crying and screamed, 'Why can't you people just leave me alone?' EMTs were called.
• September 10: While handling guns in the hunting department, he asked the clerk where the antidepressants were.
• October 3: Darted around the Store suspiciously while loudly humming the ' Mission Impossible' theme.
• October 18: Hid in a clothing rack and when people browsed through, he yelled 'PICK ME! PICK ME!'
• October 22: When an announcement came over the loud speaker, he assumed a fetal position and screamed 'OH NO! IT'S THOSE VOICES AGAIN!'
And last, but not least:
• October 23: Went into a fitting room, shut the door, waited awhile, and then yelled very loudly, 'Hey! There's no toilet paper in here.' One of the clerks passed out.

Some people just have no sense of humor !!!

 

Latest Local Statistics are Looking Good

by Harry Salzman

March 5, 2012

HARRY’S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTIAL real estate MARKET

 

LATEST LOCAL STATISTICS ARE LOOKING GOOD !!

The February PPAR statistics were just released today, and our numbers are looking good. The number of sales in February was up 8.4%, the average sales price went up 3.8% in one month, and the median sales price went up 2.6% in one month. Those numbers indicate that our local market is getting much more active. .

Another indicator that things are getting better is that our inventory of available homes has gone down by over 1000 homes since last year (3224 vs 4315). That’s a 25.3% reduction and a good indication that we are working through the foreclosure problem.

The most recent PPAR statistics regarding sales and listings in the Pikes Peak area will provide you with extensive data to assist you with your decision about buying or selling your home. We would be happy to discuss these statistics with you and to review the sales history of the neighborhoods that interests you.. Just call us at 598-3200 or 800 677-6683(MOVE)

Click here to see the most recent statistics

 

AND, LOCAL, NEW-HOME CONSTRUCTION IS UP

The Gazette (March 2, 2012) tells us that last month was the 2nd- best February in 5 years for home building permits. Permits totaled 110 in February in Colorado Springs and El Paso County, according to the Pikes Peak Regional Building Department. That’s up nearly 70% over the same month in 2011. And, for the first two months in 2012, permits totaled 195, a one-third, year-over-year increase.

 

PENDING SALES OF EXISTING HOMES UP TO ALMOST A TWO-YEAR HIGH

RIS Media - March 4, 2012

More Americans are signing contracts to buy existing homes than at any time in nearly two years, boosting the housing industry’s slow recovery, according to the National Association of REALTORS®’ index of pending home sales.

The measure is up 2 percent to 97 in January after slipping 1.9 percent in December. The index of deals for previously owned homes is up 8 percent compared with January of 2011.

Last month saw the highest point on the index since April 2010, when consumers drawn by a home-buyer tax credit pushed the figure to 111.3. That was the last time the measure exceeded 100 — the benchmark for industry health. The REALTORS® group said last week that existing home sales in January were up more than 4 percent to an annual rate of 4.57 million.

Housing experts such as Lawrence Yun, NAR’s chief economist, credit the sliding unemployment rate—which fell in January to its lowest point in three years —as well as a downward trend in home prices and a supply of homes that is at a nearly seven-year low.

“Movements in the index have been uneven, reflecting the head winds of tight credit, but job gains, high affordability and rising rents are hopefully pushing the market into what appears to be a sustained housing recovery,” Yun says in a statement.

 

HOW IS THE NATIONAL ECONOMY DOING? IT LOOKS LIKE IT IS PICKING UP SPEED

The Gazette (Thursday, March 1, 2012) reports that stronger hiring and higher pay and savings should support solid growth for the economy in coming months, according to a recent report on economic growth from the Commerce department.

The economy grew at a 3% annual rate in the October-December quarter, up from the previous estimate of 2.8%, the Commerce department said.

Economists stressed that the fundamental drivers of the economy – incomes, consumer spending and business investment – are rising.

The unemployment rate has fallen for five straight months. Consumer confidence rose in February to the highest point in a year, which should lead to more spending and faster growth

The Fed said Wednesday that all 12 of its banking districts reported some level of growth in January.

In a related story, The Wall Street Journal (Friday, March 2, 2012) also reported that there are other hopeful signs that the foundation for healthy growth are beginning to take root. Recent job gains have been broader-based and longer-lasting than at other points in the recovery. Household saving is up and the home-building market is showing signs of improvement.

Finally, REALTORMag (Feb. 28, 2012) reports the inventory of new homes on the market shrank to its lowest point on record in January, marking a 5.6 month supply at the current sales pace, according to the Commerce Department. They also noted that new home sales were up 3.5%, compared to the same time last year.

“This is indicative of the incremental, steady progress that the market is making toward recovery in conjunction with modest economic and job growth”, said David Crowe, the National Association of Home Builders chief economist.

“Increasingly, potential buyers are feeling better about their financial situation and their ability to buy a home, but the challenges posed by tight credit conditions and appraisal issues continue to slow that process”, Crowe said.

 

FINALLY, EVEN WARREN BUFFETT SAYS IT’S TIME TO BUY

In his Feb. 25 letter to Berkshire Hathaway Inc., Warren Buffet says. “I’m optimistic again. Housing will come back- you can be sure of that. Every day we are creating more households than housing units. People may postpone getting married during uncertain times, but eventually hormones take over and, while ‘doubling up’ may be the initial reaction during a recession, living with in-laws can quickly lose its allure”

That Warren sure is a romantic son of a gun.

 

BOTTTOM LINE: IT’S TIME TO GET OFF THE FENCE AND BUY THAT NEW HOME

Prices are down ….rates are low …Inventory is beginning to shrink and you’ll never see this kind of opportunity again.

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

 

AND, IF ALL OF THIS DOESN’T PERSUADE YOU, HERE’S ANOTHER REASON TO BUY NOW …FHA WILL SOON RAISE ITS FEES

In an effort to try to recoup some of its depleted reserves, and in an effort to encourage the return of more private capital to the market, FHA announced on Monday, Feb. 27, 2012, that it will soon raise its fees.

Specifically, FHA will increase two fees that borrowers pay. Starting April 1, it will increase its annual mortgage insurance premiums for loans under $625,500, bringing the total cost from 1.15% of the loan amount to 1.25%. Starting June 1, 2012, larger loan premiums will see an increase of 0.35% of a percentage point, bringing the total premium costs up to 1.5% of the loan amount.

FHA also announced it will raise a fee for the upfront mortgage premium by 0.75 of a percentage point, which will now total 1.75% of the loan amount

These new fees will also apply to home owners who want to refinance their mortgages, the agency announced

BOTTOM LINE: Call us at 598-3200, or, 800 677-6683(MOVE) to discuss these fee increases and to discuss how they could affect your home-buying decision.

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

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 39 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.

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

 

JOKE OF THE WEEK

On the first day, God created the monkey and said, "Enjoy yourself, entertain people, do tricks, and make them laugh. For this, I'll give you a thirty-year life span." The monkey said, "Monkey tricks for thirty years? That's a pretty long time to perform. How about I give you back twenty?"

And God, again saw that it was good.

On the second day, God created the cow and said, "You must go into the field with the farmer all day long and suffer under the sun, have calves and give milk to support the farmer's family. For this, I will give you a life span of sixty years." The cow said, "That's kind of a tough life you want me to live for sixty years. How about twenty and I'll give back the other forty?" 

And God agreed that it was good.

On the third day, God created the dog and said, "Sit all day on the front porch of your owner’s house and bark at anyone who walks past or tries to come in. For this, I will give you a life span of twenty years." The dog said, "That's a long time to be barking. How about only ten years and I'll give you back the other ten"

And God saw that it was good.

On the fourth day, God created humans and said, "Eat, sleep, play, marry and enjoy your life. For this, I'll give you twenty years." But the human said, "Only twenty years? Could you possibly give me my twenty, the twenty the monkey gave back, the forty the cow gave back and the ten the dog gave back; that makes eighty, okay?"

"Okay," said God, "You asked for it."

So that is why for our first twenty years, we eat, sleep, play and cavort like monkeys. For the next forty years, we slave in the sun to support our family. And for the last ten years, we sit on the front porch and bark at everyone. 

Life has now been explained to you. There is no need to thank me for this valuable information. I'm doing it as a public service. 

If you are looking for me I will be on the front porch.  

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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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