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HARRY'S BI-WEEKLY UPDATE 4.18.18

by Harry Salzman

April 18, 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.

 

GREETINGS FROM THE 2018 “NUMBER TWO BEST PLACE TO LIVE IN THE USA”…

The Gazette & U.S. News & World Report, 4.10.18

That’s according to the recently published U.S. News and World Report’s list.  If they had asked me or anyone living here we would tell them “It’s Number ONE”!  But, hey, we will be happy to be Number Two, because that means, like AVIS, “we try harder”.  

Quite honestly, it’s quite an honor and one the City has worked hard to earn.  While Austin, TX  has been number one for two years in a row—Colorado Springs has jumped up nine places from 11thin 2017 while Denver fell one place in the rankings to number three.

The rankings are based on affordability, job prospects and quality of life, using data from the U.S. Census Bureau, the Gallup-Healthways Well-Being Index, the Bureau of Labor Statistics, the FBI Uniform Crime Report and other U.S. News rankings such as best high schools and hospitals.  

“While the job market certainly plays a major role in the decision”, according to Devon Thorsby, U.S. News & World Report real estate editor, “but so does the affordability of the area, the quality of education, commute time and growth of the area, signifying the metro area’s long-term success, among other factors.”

Quality of life is the most heavily weighted factor at 30 percent, followed by affordability at 25 percent.

And the Colorado Spring job market?  We added 3,600 people to the labor force in February, the biggest one-month gain in more than 19 years according to the U.S. Bureau of Labor Statistics. However, our jobless rate in February edged down to 3.4% from 3.5% in January.  That’s because even as the labor force grew, the number of people with jobs increased even faster.  

Colorado Springs Mayor, John Suthers said last week, “There are rankings and there are rankings.  TheU.S. News and World Reportranking is very prestigious and compares Colorado Springs against some of the nation’s most dynamic and prosperous cities, including Austin, Raleigh-Durham and Denver.”

“To be the second-best city is a remarkable transformation over the past several years.  We wouldn’t have been able to do it without citizens’ investment in roads and stormwater (projects), plus all of the private investment that has been made in the last few years.”

What Mayor Suthers left out was the significant role he has played in turning the City around.  His leadership has made believers out of corporate, airline and defense leaders , among others, who are investing in Colorado Springs at a rapid pace.  PlanCOS, of which I am a member, is working behind the scenes at the Mayor’s request to come up with a 20-year plan for land use in the City, while other committees are looking into other areas of continued improvement.  

We are most fortunate to have John Suthers as our Mayor and I am equally fortunate to call him a friend.

 

BY THE WAY..

The reason for this edition coming out a few days late is due to the fact that I was waiting for the detailed Local Market Updateand Monthly Indicatorsthat I like to share with you in the middle of the month.  Since they are not yet ready, I decided to send this without them.  If you are interested in seeing them after they are published, just give me a call.

 

THE RESIDENTIAL real estate MARKET HERE CONTINUES TO BE HOT…HOT…HOT…

Let me tell you once again about working in one of the “hottest real estate markets in the U.S.”. It’s quite a challenge these days.  There just are so few homes available for sale, most especially in the $350,00 or less market.  By the time a home is listed it’s already got a waiting list for showings and oftentimes there’s an offer before the day’s end.  Crazy times in residential real estate for sure.

This is great news, particularly for sellers who have their next move mapped out.  If you’ve been thinking of listing your home, there’s no better time than NOW. However, let me reemphasize that you need to know where you will be going next because there probably won’t be a lot of time to think about that after the sale.  

I wish I could report otherwise, but this is “life in the fast lane” for buyers and sellers of residential real estate.  Once there’s an offer, both you and I need to be available to get it done as best we can. Time isABSOLUTELY of the essence.  And when it comes to moving, you need to be open to neighborhoods you might not have looked at before or consider new construction as an option. I’ve assisted a number of clients in new construction purchases lately but a consideration there is the time frame in getting the home built.  If you need to move immediately, new construction is probably not for you.  

What I’m saying once more is that you need to consider everything BEFORE beginning your search.

That’s where my special brand of customer service is a blessing.  I can help you determine the best choices based on your individual situation and we can proceed from there.  As impossible as this might seem, I can always find a silver lining for you if it’s there.   

My advice?  If you are even thinking of making a move, call me yesterday. I don’t say that factiously—you don’t have a minute to waste.  Just give me a call at 593.1000 or email me at Harry@HarrySalzman.comtoday and let’s get the ball rolling to make your residential real estate dreams come true.

Note to potential investors: With increasing home values and interest rates, some potential buyers are going to find it difficult to qualify and will be looking for places to rent.  While you might pay more in terms of price and interest rates, this will be offset with the increased rental prices.

 

AS HOUSE PRICES RISE, STRAINS EMERGE

The Wall Street Journal, 4.6.18 & 4.11.18

Homeownership is becoming a bit more difficult for a number of potential buyers as more and more Americans are stretching to buy homes before they are priced out of the market.

According to data from mortgage data tracker, Core-Logic, Inc., roughly one in five conventional mortgage loans made this winter went to borrowers spending more than 45% of their monthly incomes on their mortgage payment and other debts—the highest proportion since the housing crisis.

Economists are saying that rising debt levels are a symptom of a market in which home prices are rising sharply in relation to incomes, driven in part by an historic lack of supply which is forcing prices higher.

Consumers are becoming more optimistic about the economy and their personal financial prospects but less hopeful that now is the right time to buy a home according to a recent survey by NAR.  

Mortgage rates, while still very low, are continuing to rise, and that puts even more strain on potential buyers.  The average monthly mortgage payment is up nearly 13% nationally, according to an analysis released by Realtor.com last month.  That’s an increase of $168 per month.  For luxury homes—the top 10% of the market—owners are paying an average of $241 more per month.

Sensitivity to mortgage rate fluctuations could also vary by generation.  Millennials came of age when interest rates were at historic lows, so even a minor upswing may seem significant.  But older borrowers may recall the days when rates reached double digits—as high as 18.45% in October 1981 according to Freddie Mac—so they may perceive rates as low even if they rise by a percentage point or two.

Rates are forecast to increase through at least the end of the year, so there’s no time like the present to get off the fence if you’ve been waiting.  Yes, you may get more for your home than you expect, but you can expect to pay more for the next one, too.  And interest rate hikes are not waiting for anyone—they are coming.  

So once again—if a move is in your near future, start the process NOW.  Just give me a call today and let’s see how we can best serve your needs, wants and budget. A word to the wise.

 

BASEBALL TIME IS HERE AGAIN…

The Sky Sox are playing here for their last season as a Triple A division of the Milwaukee Brewers and they are doing very well so far.

As you know, I have four front row tickets available on a first-come, first-served basis.  Just give me a call at 593.1000 and I will be happy to set tickets aside for you for any home game this season.  

The Friday night fireworks and 50 cent hot dog Sundays go fast, so give me a call when you know you might want to take the family to the game.

 

HARRY’S JOKE OF THE DAY:  

A real estate agent had just closed his first deal. To his horror though, he then discovered that the piece of land he'd sold was completely submerged under water.

"The customer's going to come back here pretty mad," he said to his boss. "Should I give him his money back?"

His boss roared at him, "Money back? What kind of salesman are you? Get out there and sell him a houseboat."

 

 

 

HARRY'S BI-WEEKLY UPDATE 4.3.18

by Harry Salzman

April 3, 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.

As I was sitting in the Pikes Peak Center last week watching the production of “Let It Be”, I couldn’t help feel nostalgic—most especially with the rendition of John Lennon’s “Imagine.”  It reminded me of other times, different times, and yes, in some ways, easier times.

When the March 2018 PPAR statistics arrived in my email yesterday, I sang quietly to myself….”You may say I’m a dreamer….”

That’s exactly how I feel when I look at the current numbers and am just simply amazed at how far the Pikes Peak Residential real estate market has come since I began my career here in 1972.

The past few years have been nothing short of phenomenal for both buyers and sellers.  However, the still historically low interest rates, while slowly rising, are quite a change from the 1970’s, too and are helping first time and move up buyers get into homes of their dreams.  Investors are also seeing great returns as the rental market has picked up exponentially too.

Despite the shortage of listings, both here and across most of the U.S., Colorado Springs has climbed to number 3 on the Realtor.com “Hot List” which reflects the metro areas garnering the most listing views on their site, as well as where homes spend the fewest days on the market.

According to Javier Vivas, director of economic research at realtor.com, “Never in history have there been more eyes on fewer homes than today.  The price gains observed in the last days of March tell us the market is on pace to see half of the homes listed above $300,000 this summer.  This means buyers are not just having to pay more for the same home—they’re also seeing the mix of what’s available change more rapidly.”

And, according to the U.S. Census Bureau, El Paso County is seeing the largest gain in population among the other fast-growing counties along Colorado’s Front Range.  Our population increased by 12,526, the most in 2017, followed by Weld County and then Denver. 

While Denver remains the Colorado county with the highest population—704,621 people—El Paso County is close behind with 699,232 people.

State population forecasts show that El Paso County could initially surpass Denver in population in 2020.  They are expected to run neck-in-neck until 2035, when El Paso County is expected to take the lead for good. 

Local experts are attributing this to our high quality of life, low property taxes and utilities and increased economy and job growth. The county also attracts veterans, military retirees and young families. Spillover from the Denver area is also a factor according to Steve Schleiker, El Paso County Assessor. 

If you’re considering a move and wondering how all of the above applies to your individual wants, needs and budget, simply give me a call today at 593.1000 or email me at Harry@HarrySalzman.com and let’s see how I can put my special brand of customer service to work for you.

 

And now for a few AMAZING statistics…

Homes are selling at 100.3% of listing price with the average days on the market at a low 25. 

This continues to be great news for both buyers and sellers, despite the fact that interest rates are beginning to rise.  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 3.8% and 0.5% respectively for year-over-year.  As you might imagine, 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 5.7% for Single Family/Patio Homes and down 30.2% for Condo/Townhomes, continuing a downward trend that tends to favor sellers.  New listings are down 0.1% for Single Family/Patio Homes and up 20.5% for Condo/Townhomes.  The reality is that total active listings are at a record low and remain a factor in the median price escalation. 

For more details, please see the following article.

 

MARCH 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 March 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 March 2018 to March 2017 for All Homes in PPAR:                     

                        Single Family/Patio Homes:

  • New Listings are 1,758, Down 0.1%
  • Number of Sales are 1,231, Down 1.3%
  • Average Sales Price is $340,594, Up 15.1%
  • Median Sales Price is $300,000, Up 11.9 %
  • Total Active Listings are 1,371, Down 5.7%
  • Months Supply is 1.1

                        Condo/Townhomes:

  • New Listings are 270, Up 20.5%
  • Number of Sales are 175, Down 17.8%
  • Average Sales Price is $211,378, Up 16.4%
  • Median Sales Price is $208,546, Up 20.5%
  • Total Active Listings are 97, Down 30.2%
  • Months Supply is 0.6

 

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

                                                Median Sales Price             Median Sales Price

                                                  March 2018                            March 2017

Black Forest                            $552,500                              $465,000                      

Briargate                                  $385,000                              $380,000           

Central                                     $250,000                              $225,000

East                                          $260,000                              $242,500

Fountain Valley:                      $267,000                              $230,000

Manitou Springs:                    $290,000                              $341,225

Marksheffel:                             $319,000                             $295,000

Northeast:                                $292,500                              $267,750

Northgate:                                $469,000                              $430,000           

Northwest:                               $389,500                              $397,500           

Old Colorado City:                  $230,000                              $250.500

Powers:                                    $295,635                              $260,000

Southwest:                              $300,000                              $282,450

Tri-Lakes:                                $482,000                              $425,000

West:                                        $343,000                              $290,000

 

MARKET CHALLENGES DAMPEN HOPES BUT BUYERS MAY LOSE IF THEY DON’T ACT NOW

RealtorMag, 3/22 & 3/26.18

Although consumers are optimistic about the economy, job market and their own personal finances, more and more are expressing anxiety about their ability to buy a home, save for a down payment and qualify for a mortgage, according to the NAR’s Housing Opportunities and Market Experience survey for the first quarter of 2018.

The top barriers to homeownership is perceived to be saving for a down payment and qualifying for a mortgage, stemming from concerns about future incomes, student loan debt and having a low credit score, according to the survey.

As might be expected, current homeowners, older consumers and those living in more affordable housing markets express the most optimism about buying.  “The critical shortage of listings in most markets continues to spark a hike in home prices that is not easy for many buyers—especially first time buyers—to overcome,” says NAR Chief Economist Lawrence Yun.  “Adding more fuel to the affordability fire is the fact that mortgage rates have shot up to a four year high in just a few months.”

On the other hand, the share of homeowners who say now is a good time to sell has increased in the latest survey.  “There’s no question that a majority of homeowners have amassed considerable equity gains since the downturn,” Yun says.  “Home prices have grown a cumulative 48 percent since 2011 and are up 5.9 percent (nationally) through the first two months of this year.  Supply conditions would improve measurably—and ultimately lead to more sales—if a growing number of homeowners finally decide that this spring is the time to list their home for sale.”

Accordingly, buyers may want to speed up their home search this spring, as interest rates are forecasted to move higher in the coming months.  Forty-four percent of home buyers say rate increases will likely force them to settle for a smaller, less expensive home that requires a longer commute to their jobs, according to a realtor.com survey.  First time buyers may be most affected by rising costs, as increasing home prices and interest rates price some out of the market.

For the bulk of buyers, it’s not going to kill their decision to purchase a home and if anything, it should get them off the fence by creating a sense of urgency.  Higher rates are a “kick in the pants” for folks to start getting serious about buying now.

Rate increases—even minor ones—can add up over time.  Realtor.com offers this example:  On a $300,000 house with a 30-year-fixed-rate mortgage and 20 percent down payment, the difference between a 4 percent and a 5 percent mortgage rate is $142 a month.

I’ve been telling you for some time now that if you’re in the market—THERE’S NO LONGER TIME TO WAIT.  Folks who thought they could wait are now getting concerned about rising home prices and interest rates.  They are starting to realize that if they are going to buy, they probably should buy NOW.

Don’t wait any longer—give me a call today and let’s do what we can to make all your residential real estate dreams come true.

 

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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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