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HARRY'S BI-WEEKLY UPDATE 3.20.18

by Harry Salzman

March 20, 2018

 

HARRY’S BI-WEEKLY UPDATE

           A Current Look at the Colorado Springs Residential real estate Market

As part of my Unique Brand of Personal Service, it is my desire to share current real estate issues that will help to make you a more successful and profitable buyer or seller.

 

NOTE TO ALL BUYERS AND/OR POTENTIAL BUYERS—NOW IS NOT THE TIME TO WAIT

The Residential real estate Market in the Pikes Peak area is still experiencing an accelerated pace when it comes to home buying and selling and a slowdown doesn’t seem likely for some time.  I’ve never seen homes sell quite so fast and the listing shortage is not helping.  This is happening in a lot of areas across the country, but most especially in Colorado Springs since we are one of the “hottest markets in the U.S.”.

If you’ve been thinking about the possibility of buying—either to sell and trade up or for investment purposes or the first time—NOW is the time.  Here are some good reasons:

  • Home prices are continuing to rise
  • Interest rates are soon to rise more
  • There is a shortage of listings in ALL price ranges
  • New home construction costs are continuing to rise, along with wait times (more on that later)
  • The “spring buying season” started this month
  • Your present home has more equity than you might think
  • Rental rates are rising and will continue to do so

There you go.  It’s most definitely remaining a Seller’s Market and will continue to be so until there are more available listings.  That’s a “two sided sword” in some ways since you may get more from your present home than you might imagine.   But you will most definitely need to know where you intend to move prior to listing since it will likely sell much quicker than it might have in recent years. 

If you have even thought about a move, NOW is the time to call me to help you in coordinating all of your wants, needs and budget constraints.  My 46 years of experience in the local arena can give you a step up in the process and save you some disappointment along the way.  I have years of experience in knowing the “ins and outs” of writing contracts that will at least get a second look, if not accepted the first time.  In these days of multiple offers and over-list-price sales, that’s quite a feather in your cap.

There are still available homes in most price ranges but quick decision-making is crucial and it’s important to have a lot of these issues out of the way prior to starting your search.  There will not be any time to “figure it out” once you find a home you want.

Give me a call today at 593.1000 or email me at Harry@HarrySalzman.com and let me put my special brand of customer service to work for you.

 

AS I ENTER MY 47th YEAR IN LOCAL RESIDENTIAL real estate…

Next month I will have been working in the local Residential real estate arena for 46 years.

During this time I have had the privilege of earning the respect and loyalty of three generations of residential clients by providing superb service and delivering outstanding results.  I am known as an innovative, creative and hardworking broker with a special knack for listening, marketing, negotiating, and transaction management.

My clients rave about my familiarity with the area, almost limitless contacts and connections, responsiveness and my extraordinary courtesy. 

I’m especially proud of my coveted REALTOR Emeritus status from the National Association of REALTORS for continuous client service spanning four decades, my participation on various non-profit and national relocation boards, and the PPAR Government Affairs Committee, among others. 

Most importantly it has been my pleasure to give back to the City of Colorado Springs by serving on the City Planning Commission and the Parks and Recreation Board and am now a member of the Plan COS committee for the Mayor and City Council. 

Thank you ALL for helping to make this happen.  I look forward to working with you and your families for a long time to come.

 

FEBRUARY 2018 LOCAL MARKET UPDATE AND MONTHLY INDICATORS ILLUSTRATE OUR CONTINUING UPWARD TREND IN GREATER DETAIL

Pikes Peak REALTORS® Services Corp.,

These reports contain much greater detail than the first of the month reports I share and cover ALL residential areas in the Pikes Peak Region.

The local median sales price increase year-over-year in all properties was an amazing 14.3%. The shortage of listings is helping to drive up prices and as I just mentioned, if there were more listings, more people would be moving—either selling to trade up or buying for the first time and for investment purposes.

In the recently published February 2018 Monthly Indicators and Local Market Update for El Paso and Teller Counties, new listings year-over-year were down 2.9% for the single-family/patio homes and down 17.0% for condo/townhomes. 

     The “Activity Snapshot” shows the one-year change:

  • Sold Listings for All Properties was up 1.1%
  • Median Sales Price for All Properties was up 12.1%
  • Active Listings on All Properties was down 24.8%.

You can click here to read the 16-page Monthly Indicators or click here to get specific information on the neighborhood of your choice from the 34-page Local Market Update. I recommend that you check out your own neighborhood, or one that you are considering, to get a good idea of the local pulse. I have reprinted just one neighborhood, Powers, below to show you the type of information available for all local areas.

For questions about any of these reports or just to find out how I can put my special brand of customer service to work for you, please give me a call.

 

THE NEXT real estate CRISIS:  A SHORTAGE OF NEW HOMES

The Wall Street Journal, 3.19.18

As I indicated earlier, new home construction is becoming more expensive.  This is in part due to increased costs of aluminum, copper, lumber, new regulations and building codes that are changing to boost energy efficiency and other factors.  However, new construction is also facing a shortage in many price ranges.

In fact, the country in general is building homes at near the lowest level in history despite the strong economy.  Fewer homes are being built per household than at almost any time in U.S. history. 

Home construction per household a decade after the bust remains near the lowest level in 60 years of record-keeping, according to the Federal Reserve Bank of Kansas City. 

What makes the slump puzzling is that by most other measures, the American economy is booming.  Jobs are plentiful, wages are on the rise and the stock market is near record highs.  Millennials, the largest generation since the baby boomers, are aging into home ownership.

Demand for housing is stronger than ever, but land and construction costs have roughly doubled since the end of the last boom a decade ago.  And a number of builders have sifted focus from starter and mid-price houses to high-end properties, where the profit margins are fatter. 

A combination of tightened housing regulations, lack of construction labor and a land shortage in highly prized areas is driving the crisis, according to industry experts.

The National Association of Home Builders estimates that builders in 2018 will start fewer than 900,000 new homes, less than the roughly 1.3 million that are needed to keep up with the population growth.  And the overall inventory of new and existing homes for sale hit its lowest level on record in the fourth quarter of 2017, at 1.48 million, according to the National Association of Realtors (NAR).

That, in turn, is pushing up prices at what economists say is an unsustainable pace.  The S & P CoreLogic Case-Shiller National Home Price Index rose 6.3% in 2017.  That was roughly twice the rate of income growth and three times the rate of inflation.

The lack of homes and bidding wars are making things much harder for first-time buyers. 

Builders cite numerous factors contributing to the construction slump.  A decades long push for young people to go to college has driven down trade-school enrollment, depriving builders of skilled labor.  Declining number of immigrant construction workers has sapped builders of unskilled labor. 

Economists also say that builders in far-flung exurbs are encountering stiffer resistance from young buyers even as prices escalate higher for land closer to cities.  They say that in many large metro areas, suburbanization might simply have reached its limits, as potential buyers increasingly reject long commutes.  In the 1950’s buying a home in a new suburb, where land was plentiful and cheap, often meant driving half an hour to a job in the city.  Today, commutes from new developments can be several times as long.

After years of moribund building activity, there have been signs of improvement in recent months.  The homeownership rate increased last year for the first time since 2004, driven by younger buyers who overcame rising prices and a lack of inventory to purchase their first homes.  However, building remains below historical averages, and economists say it is unlikely to return to those levels before the next recession.

What does this mean to you?  Again….one more time…”sooner than later” means do not delay at all if you are serious about buying.   And for investment buyers—there are going to be more and more renters looking for a place to live.  So whatever your buying needs might be—CALL ME TODAY and let’s see how we can work against the odds.

 

LOCAL BUILDING CODE CHANGES WILL RESULT IN HIGHER PRICES FOR NEW HOMES

The Gazette, 3.12.18

While a new regional building code will likely provide more energy efficient homes locally, it will certainly add to the price of a new home.

This latest edition of the building code will bring local rules more in line with the newer national standards, but with the current housing shortage this doesn’t come at an opportune time.  The code is set to be in place by June and how it will affect local new home prices is not yet certain. 

While much of the cost increase will be fueled by the new efficiency requirements—which mostly have to do with how airtight a home is—a few other improved health and safety standards might also increase prices.

Local builders are indicating that the new code will likely result in a price increase of anywhere between $2,200 to $10,000, depending on the size of the structure. 

Housing industry reps say that even an incremental increase in the overall price of a home can make a difference in whether a prospective buyer can afford it.  A 2016 study by the NAR found that for every $1,000 that the price of a Colorado Springs home rises, 275 households are “priced out” and can no longer qualify for a mortgage.

While it’s possible that these increases will “pay for themselves” over time due to energy savings, the immediate effect will result in higher home prices.

My advise to you if you’re looking for a new home now is to call me as soon as possible so that you can lock in today’s prices if at all possible.  Just give me a call at 593.1000 and I will be happy to work with you on this.

 

SALES TAX IN COLORADO SPRINGS IS STRONG INTO 2018

The Gazette, 3.17.18

Consumer spending in January fueled the biggest monthly gain in local sales tax since June, according to the city’s Finance Department.

Why mention this?  Well, to begin with, it’s just one more indication that our local economy and job market is strong and looks to continue on that path.  It is also why more and more folks are looking for housing and thus driving the shortages we are experiencing there.  It all goes hand in hand, so once again….if you’re looking to sell—NOW is a great time to take advantage of the equity in your home to trade up or move to a new neighborhood.

 

HARRY'S BI-WEEKLY UPDATE 3.5.18

by Harry Salzman

March 5, 2018

 

HARRY’S BI-WEEKLY UPDATE

          A Current Look at the Colorado Springs Residential real estate Market

As part of my Personal Service, it is my desire to share current real estate issues that will help to make you a more successful and profitable buyer or seller.

MEDIAN HOME PRICES ARE WAAYYY UP FOR ANOTHER MONTH…NOW HAVE GOT YOUR ATTENTION? 

It’s been such a busy week I’m not sure where to begin so I’ll start with Saturday morning.  I listed a home at 10 a.m. and it was on PPAR MLS by 11 a.m.  Within four hours I already had three offers and I cannot even make contact with the seller sometime today.  There were 13 showings in six hours and I’m guessing there will be offers from most of them also.  Sounds like I’m heading into a bidding war for my sellers.  Welcome to 2018 Residential real estate in Colorado Springs.

I have never witnessed a market like we are currently experiencing and the end just isn’t in sight.  In fact, if we had more homes for sale we’d be even seeing more growth.  Yes, folks, this continues to be a Sellers Market and will continue to be until we have more homes available for sale.

Just to give you an example from my company alone in comparing last week to the same week one year ago:

ERA Shields Active Listing Inventory:

2017:  104

2018:   97

 

ERA Shields Total Showings:

2017:   171

2018:   380

 

Showings Per Listing Year Over Year:

2017:  1.64

2018:  3.92

What this means is that “Showings Per Listing” are up 139% year over year.  Just think about that.  If you have been considering a move---NOW is the best time to insure maximum exposure to potential buyers. 

Besides the lack of listings, we are dealing with escalating mortgage interest rates, renters wanting to become first time or once-again homeowners, and prices rising faster than I can ever remember.  With the “traditional” spring buying season just about to begin, folks will be looking for trade up homes or for homes in new neighborhoods or new school districts.  Disappointment is becoming a bit of the norm I’m afraid.  There just aren’t as many homes to choose from and when you do find one, you have little or no time to make a decision. 

That’s why you need to do as much homework as possible BEFORE you begin the search.  You must decide what you want, need and can afford long before you start looking.  And if you are looking at new construction, which is becoming more of an option for many of my clients, then you most likely are looking at “getting in line” there too. 

Prices of new construction keep going up—not arbitrarily—but due to the rising cost of labor, lumber, copper and other uncontrollable factors.  The fires and hurricanes in other parts of the country may not have affected us directly, but we ARE experiencing the effects nonetheless in the new housing arena.

Lots to consider?  I am available to help you in determining any and all of these things. Having someone like me on your team makes the entire home buying and selling experience one that will be as stress-free as possible, which is no easy feat in today’s market.

If you’ve been sitting on the fence about selling to trade up or to purchase for the first time or investment purposes, it’s no longer prudent to wait.  However, I want to again remind you that if you’re looking to sell, it’s important to know where you will live next since your present home will likely sell much faster than you might have anticipated. 

Simply give me a call today at 593.1000 or email me at Harry@HarrySalzman.com and let me put my special brand of customer service to work for you.

 

And now for a few statistics…

Homes are selling at 99.8% of listing price with the average days on the market at a low 38.  This continues to be great news for both buyers and sellers, despite the fact that interest rates are rising.  However, as I just mentioned, it does foster the necessity for fast decisions, so “a word to the wise”…

As you will see in the Cumulative Year to Date Summary, total sales numbers in Single Family/Patio Homes and Condo/Townhomes are up 3.3% and 9.2% respectively for year-over-year.  This number would have been much higher had there been more homes for sale. 

The Monthly Summary shows that compared to a year ago, total active listings are down 8.4% for Single Family/Patio Homes and down 48.4% for Condo/Townhomes, continuing a downward trend that tends to favor sellers.  New listings are down 3.1% for Single Family/Patio Homes and down 17.1% for Condo/Townhomes.  The reality is that total active listings are at a record low and are a factor in the median price escalation. 

For more details, please see the following article.

 

FEBRUARY 2018 WAS ANOTHER OUTSTANDING MONTH IN LOCAL RESIDENTIAL real estate

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

Here are some highlights from the February 2018 PPAR report.  A look at the Median Sales Prices should put a big smile on many of your faces!  Please click here to view the detailed 15-page report, including charts. If you have any questions, just give me a call.

In comparing February 2018 to February 2017 for All Homes in PPAR:

                       

                        Single Family/Patio Homes:

  • New Listings are 1,233, Down 3.1%
  • Number of Sales are 946 Up 18.3%
  • Average Sales Price is $331,104, Up 9.9%
  • Median Sales Price is $292,470, Up 14.7 %
  • Total Active Listings are 1,342, Down 8.4%
  • Months Supply is 1.3

 

                        Condo/Townhomes:

  • New Listings are 145, Down 17.1%
  • Number of Sales are 140, Up 11.1%
  • Average Sales Price is $211,001, Up 15.8%
  • Median Sales Price is $204,750, Up 13.8%
  • Total Active Listings are 63, Down 48.4%
  • Months Supply is 0.5

 

COLORADO SPRINGS AREA MONTHLY SINGLE FAMILY/PATIO HOME SALES ANALYSIS*

                                                Median Sales Price             Median Sales Price

                                                  February 2018                       February 2017

Black Forest                            $514,950                              $489,950                      

Briargate                                  $377,450                              $388,225           

Central                                     $230,000                              $180,000

East                                          $250,000                              $230,000

Fountain Valley:                      $265,000                              $230,000

Manitou Springs:                    $419,000                              $185,990

Marksheffel:                            $310,989                              $261,407

Northeast:                                $295,000                              $259,500

Northgate:                                $446,900                              $440,000       

Northwest:                               $392,500                              $395,000           

Old Colorado City:                  $270,000                              $236,500

Powers:                                   $284,450                              $254,900

Southwest:                              $403,600                              $246,000

Tri-Lakes:                                $470,000                              $485,000

West:                                        $325,000                              $250,000

*Statistics provided by the Pikes Peak REALTORS Services Corp,or its PPMLS.

 

DASHBOARD FROM UCCS ECONOMIC FORUM

Please click here for a look at the detailed charts from the UCCS Economic Forum updated on February 21, 2018.  These show economic trends for the country as well as for El Paso County and cover such areas as housing, cost of living, consumer sentiment, job market and more.

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

 

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Harry A Salzman
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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