HARRY'S BI-WEEKLY UPDATE 6.18.18
June 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.
THE LOCAL RESIDENTIAL real estate MARKET FEELS LIKE A MERRY-GO-ROUND AT TIMES…
…one that just keeps moving and faster and faster these days. Our tight local inventory is keeping everyone on their toes. Not only does it allow fewer choices in the resale sector but multiple offers and those considerably over listing price are the new “normal”.
And with the prices of lumber, copper, aluminum and other building materials escalating daily, even the prices of new construction are rising faster than normal. Turnaround times in new construction are getting longer too, as more folks are turning to that option than in the past few years.
Interest rates, while fluctuating, are still historically low but with the Federal Reserve again raising rates this past week and having intentions to raise them several times more this year—we are beginning to see people concerned that they could get priced out of homeownership.
Colorado Springs is one the of “hottest” markets in the country and while that’s a good thing for those of us who live here, it’s making things a bit tough for first-time buyers and those wanting to sell and trade up. Homes are selling at such a rapid pace that I advise anyone looking to trade up or relocate to a new neighborhood to know exactly where they plan to move PRIOR to listing their present home. Closing times are getting shorter and if you don’t have your next move planned you could find yourself “homeless” so to speak.
It’s especially tough for folks looking to relocate to the Springs, and we are experiencing a lot of activity in that area at present. Those relocating are usually here for a limited time on “buying trips” and unfortunately many of the homes they wish to see are sold even before they can consider them. Several of my clients have bought homes without even seeing them because they don’t want to miss out on a chance to make an offer in person. This is something many of us Realtors have not seen before, but unless there are more available homes it’s not going to change anytime soon.
This is most definitely still a Seller’s Market and will continue to be so until there are more listings. If you have even considered whether a move might be good for you and your family, NOW is the time to check out the possibilities.
While the market is indeed tight, there are still homes available in MOST price ranges and neighborhoods and we can find one that fits your wants, needs and budget. That’s where I come in. My 46 plus years in local real estate is your biggest asset. I know the “ins and outs” of negotiation, finding the right lender for your individual situation and always do my best to make certain that the first offer you make is one that will at least get attention, if not make it to closing.
New construction can also be a possibility and I can help you in that area, too. I have longstanding relationships with most of the local homebuilders and my expertise in this arena is yours at no additional cost to you.
So, there you go. My advice? If you are even thinking of making a move, call me yesterday--you don’t have a minute to waste. I can be reached 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.
MAY 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.
In the recently published May 2018 Monthly Indicators and Local Market Update for El Paso and Teller Counties, new listings year-over-year were down 3.8% for the single-family/patio homes and down 16.4% for condo/townhomes.
The “Activity Snapshot” shows the one-year change:
- Sold Listings for All Properties was down 6.3%
- Median Sales Price for All Properties was up 13.0%
- Active Listings on All Properties was down 18.4%.
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, Old Colorado City, 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.
CONSUMER SENTIMENT BREAKS RECORD—AGAIN
RealtorMag, 6.11.18
Fannie Mae’s Home Purchase Sentiment Index reached an all-time survey high for the second straight month in May. However, as home prices rise, consumer attitudes about buying and selling a home are diverging even more.
The net share of survey respondents who say now is a good time to sell rose to 46% and is now up 14 percentage points year-over-year. Conversely, the net share who say now is a good time to buy fell to 28% and has shown little improvement over the past year.
According to Doug Duncan, Fannie Mae’s chief economist (who will be leaving the organization in the near future), the Home Purchase Sentiment Index “edged up to another survey high in May, bolstered in part by a fresh record high in the net share of consumers who says it’s a good time to sell a home.”
“However,” he continued, “the perception of high home prices that underlies this optimism cuts both ways, boosting not only the good-time-to-sell sentiment but also the view that it’s a bad time to buy, and presents a potential dilemma to repeat buyers.”
Here’s a look at other results from the May survey:
- 49%: The net share of Americans who say home prices will rise in the next 12 months, which is unchanged from the month prior.
- 78%: The net share of Americans who say they are not concerned about losing their job, rising 2% month-over-month to reach a new survey high.
- 21%: The net share of Americans who say their household income is significantly higher than it was 12 months ago, up 3 percentage points month-over-month to reach a new survey high.
My take from the survey? Once again, it’s a great time to both buy and sell. The local economy and job market are both doing well. Interest rates are still relatively low and home prices are only going to continue to rise, however possibly not at such a rapid rate once there are more homes to sell. If you’ve been waiting to put the home equity you’ve earned to work for you—call me and let’s see what we can do.
COLORADO SPRINGS JOB MARKET IS ONE OF THE BEST
The Gazette, 6.12.18
And speaking of our job market…a survey by staffing giant ManpowerGroup has said that it will be among the best in the nation—tied with three other cities as the nation’s fifth best—during the third quarter 2018. This is a big move up from the second quarter where the Springs was ranked 14th, tied with five other cities.
Manpower’s definition of the “best” is those with the biggest difference between the percentage of local employers planning to hire additional staff and those expecting cuts. The survey includes more than 11,500 employers and Manpower does not disclose the number of participants in the local survey.
The “net employment outlook” for Colorado Springs is projected at 30 percent in the July-to-September quarter with 21 percent of employers surveyed anticipating additional hiring and just 1 percent forecasting cuts. The rest indicated they expect no change in staffing levels or were not sure of plans.
The Springs ranked ahead of Denver, the only other Colorado city in the survey, which was tied with five other cities at 19thbest.
The local unemployment rate remained unchanged from March at 3.2 percent in April, or just 0.4 percentage points above the lowest rate since 1990 and slightly higher than the statewide rate of 2.9 percent.
According to Tatiana Bailey, director of the UCCS Economic Forum, “The number of openings listed by Pikes Peak Workforce Center exceeds the number of available workers by nearly 1,200 and that gap is again widening after narrowing for much of the past six months.”
“The labor market keeps getting tighter and tighter. Having an unemployment rate this low along with this many openings is an indicator of an expanding economy,” Bailey said.
The ManpowerGroup survey found job prospects strong in nearly every sector of the local economy with government the only sector expected to remain unchanged.
Other details from the survey:
- The statewide and Denver area outlooks weren’t quite as strong as the local outlook at 28 percent and 25 percent, respectively. Colorado ranked fourth, tied with Alabama and Alaska, after Indiana, Wisconsin and Montana.
- Our local outlook was stronger than the national average of 21 percent, or 18 percent after seasonal adjustments. The national outlook is slightly improved from 20 percent, or 17 percent after seasonal adjustments, during the same quarter last year.
- All industry sectors monitored by Manpower had outlooks in the third quarter of 13 percent or more, or 11 percent after seasonal adjustments.
TAX LAWS HAVE BUYERS ON THE MOVE
The Wall Street Journal, 6.8.18
The new tax rules that cap deductions of state and local taxes are having a disproportionate effect on taxpayers who live in states with high income taxes and property taxes. While it’s still too early to quantify the impact of the Tax Cuts and Jobs Act, which became effective on January 1, some real estate professionals say they are starting to see early signs of an exodus to low-tax states.
Prior to the new rules, taxpayers who itemized could write off an unlimited amount of state and local taxes, unless disallowed under the alternative minimum tax. Now the deductions are capped at $10,000.
The change most affects taxpayers in states with high income and property taxes. If this is of concern to you, please discuss with your tax advisor or accountant to see if and how these new rules pertain to your individual situation.
However, before you consider moving for tax purposes, here are some things to consider:
- It isn’t about the taxes. You need to consider your lifestyle as well. It is great to save money but if you’re not a Florida person and you move there just to save taxes, you’re making a big mistake.
- Look at all the costs. In deciding whether to move, and where—look at the other costs of ownership. A state with low income taxes may make up for it with a higher sales tax. Or you might end up paying substantially higher costs for homeowner’s insurance. Therefore, you might ultimately save on income taxes by establishing residency elsewhere, but if the state you’re moving to has higher costs of ownership, it might turn out to be a wash.
- Keep up on the news. Some states are trying to fight back against the federal limitations on the state and local tax deductions through workarounds that would allow residents to continue to benefit from the deductions. There is no way of knowing, however, if these tactics will ultimately survive a challenge by the IRS.
