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Harry's Bi-Weekly Update 8.18.14

by Harry Salzman

August 18, 2014


                       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.                       



When I saw this illustration I couldn’t help think about “Dick and Jane” and “Spot” and the early days of learning to read at school.  With most schools starting this week in Colorado Springs, a lot of kids will be attending a new school because of it being their first time, graduations, or their family has moved to a new neighborhood.

I personally have helped a number of families relocate this year and when there are children involved, one of the big considerations is moving to an area with good schools, parks and other children in the neighborhood for playmates. One of the many facets of moving involves the happiness of the “entire” family, especially the young members.  Oftentimes the parents might want to look at various neighborhoods recommended by friends and I have had to lead them in another direction entirely because of my awareness of the lack of “kid friendliness” of their first suggestion. 

My objective as a Realtor is to try my best to find the best fit for the family as a “whole”.  Having been involved in more than 2000 transactions during the last 42 years has given me extensive knowledge of local neighborhoods and how they might work for a particular family’s needs. 

Neighborhoods change over time, as do the demographics and the quality of schools located within them.  No matter how much you might like a home, if it no longer suits your family’s current needs there will be considerable stress for all.  And if you are looking to Buy, the house you think is great might not be located in the best area for the needs of all family members. 

These considerations are probably the most important when looking for a home or considering to Sell your present one.  The happiness of the entire family will play a role of great importance for the next several or many years, depending on your individual situation. 

My goal is to make sure that the “Good Old Days” are here to stay for every family I relocate and I can help you and your family share in that goal.  Your happiness is important to me.  I will always make that my main focus when working with each and every client. 



NAR,8.12.14, 8.12.14, The Wall Street Journal, 8.13-16.14, RealtorMag, various dates, DSNews 8.7.14

The National Association of Realtor’s (NAR’s) latest Quarterly Report of Median Sales Price of Existing Single-Family Homes for Metropolitan Areas was released several days ago and home value appreciation continued to moderate in 122 of the 173 metropolitan areas surveyed. 

While the median existing single-family home price increased in 71% of measured markets from the second quarter 2013, the gain continued to be lower than in recent times.  Colorado Springs was among those cities and showed an increase in median home price of 1.4% compared to a year ago.

Forty-seven areas (27%) recorded lower median prices during that same time period.  To read the 3-page report in its entirety, please click here.

Lawrence Yun, NAR chief economist, says price increases are balancing out the benefit for both Buyers and Sellers.  “National median home prices began their most recent rise during the first quarter of 2012 but had climbed to unsustainable levels given the current pace of inflation and wage growth,” he said.  “At this slower but healthier rate, homeowners can continue steadily building equity.  Meanwhile, for Buyers, increased supply with moderate price gains is giving them better opportunities to choose.”

The national median existing single-family home price in the second quarter was $212,400, up 4.4% from the second quarter of 2013.  The median price during the first quarter of 2014 rose 8.3% from a year earlier.

Yun added that despite the stabilization in price growth, sharp increases still exist in some markets and are impacting sales, most notably on the West Coast where inventory shortages are more prevalent. 

Despite the slow increase in home prices, Yun still expects home sales to make a strong showing in the second half of 2014.  He also made the following forecasts.

  • Higher inflation and higher interest rates.  The Federal Reserve is planning to end its purchasing of Treasury and mortgage-backed securities in October.  Yun expects interest rates to increase in 2015.  He also expects the Consumer Price Index (CPI) which measures inflation, to increase 3.5 percent in 2015.
  • Multi-year housing expansion.  The population is on the rise.  The U.S. gained 34 million people since 2000, but home sales were 5.2 million in 2000 and 5.1 million in 2013.  The pent up demand will eventually equate to additional home sales over the next few years, Yun says.
  • Continued inequitable wealth distribution.  Household net worth is at an all time high, but only for the 10 percent of the U.S. population that has investments in the stock market.  At the same time, rents are rising and incomes are generally stagnant.

According to Mark Fleming, the chief economist with CoreLogic, the ongoing slowdown in price appreciation reflects a “reversion to normality” that is “expected to continue across the country and should further alleviate concern over diminishing affordability and the risk of another asset bubble”.

Fannie Mae’s chief economist, Doug Duncan, in commenting on Fannie Mae’s July 2014 National Housing Survey says “the continued cautious sentiment expressed across the range of consumer indicators this month gives weight to our view that the first phase of the housing recovery is decelerating, and 2014 will be a year of mixed housing outcomes with home prices rising more slowly and home sales falling slightly.  We have always believed that for the housing recovery to be considered robust, we will need strong and sustained full-time job and income growth.  Recent data indicating the creations of more than 200,000 jobs over each of the last six months, combined with this month’s improvement in the share of consumers reporting significantly higher household income than a year ago, does provide some reason for optimism.  If these trends continue, they could lead to some upside in housing in 2015.”

For now, though, caution seems to be the rule.  Many economists are saying that price appreciation is slowing partly because Buyers, including Investors, have become more cautious and are pulling back amid the big price gains of the past year.  Also, these same price gains have persuaded more homeowners to put their homes up for sale which has added inventory.  The multiple-offer situations are not as prevalent as they were earlier this year.

There are also some Sellers who are listing their homes now rather than waiting for next year’s Spring buying season because of fear that interest rates will be higher at that time.

Highlights from the Fannie Mae Survey include:

  • Half of respondents said they thought it would be difficult for them to get a home mortgage today
  • The average 12-month home price change expectation dropped to 2.3%
  • The average 12-month rental price change expectation fell to 3.8%
  • The share of respondents who say their household income is significantly higher than it was a year ago rose by 4 percentage points to 28%--a survey high.

 And locally…

As I mentioned above, Colorado Springs saw a 1.4% increase in the median home price in the NAR Quarterly Report.  While this is lower than recent increases, it must be reiterated that our area never saw the dramatic drops or number of foreclosures that many areas in the country did. 

What these statistics mean to us is that our local homes are still increasing in value and providing steady home equity for owners.  More importantly, it means that more Buyers are NOT being priced out of the market by unsustainable home price gains that have kept them from qualifying for home financing.  It’s a “win-win” for all at the moment, most especially when you consider that mortgage loan rates are still historically low and lenders are slowly making funds more available.



RealtorMag 8.15.14, Housingwire, 8.8.14

This past week, the 30-year fixed-rate mortgage rate averaged it’s low for the year at 4.12%.  The same low was reached in May as well as a week in July, this according to Freddie Mac in its weekly mortgage market survey.

The rates have countered many forecasters’ expectations so far this year by not rising, but dropping instead.

Will this continue?  According to the above statements by Yun, possibly not.  But it’s really anyone’s guess at the moment. 

The best advice I can give you is today’s interest rates are CHEAP.  If you Buy now, I believe you will be looking back a year from now and be happy that you did.



The Gazette, 8.9.14, DSNews, 8.11.14

FICO, the company responsible for one of the most widely used measures of credit health is making changes to its current model that could boost credit scores nationwide.

In a recent announcement, analytics and decision management from FICO said its new credit model, FICO Score 9, “introduces a more nuanced way to access consumer collection information,” resulting in greater precision for lenders measuring a borrower’s credit stability.  The model will be available to lenders through the country’s various reporting agencies in the fall.

When I learn how the changes will effect home mortgage lending, you will read it here.

And good news for renters looking to buy…two of the national credit bureaus—Experian and TransUnion—have begun incorporating verified rental-payment data into credit files where it can be included in the computations of credit scores when they apply for a mortgage. 



The Wall Street Journal 8.5.14, Bloomberg-BusinessWeek, 8.5.14

The Federal Reserve’s quarterly survey of banks showed that nearly one in four U.S. banks said they had eased mortgage-lending standards for borrowers with strong credit during the second quarter of 2014.  This is the largest such movement by lenders since the housing bust hit 8 years ago.

The standards have eased amid sustained increases across the U.S. in home prices and a plunge in refinancing activity over the past year. 

According to the survey, demand for prime mortgages rebounded to its highest level in a year, offering a hopeful sign for housing markets that have stumbled during the first half of the year. 

Over the past year, top policy makers have expressed concern that tight credit standards could hamper the housing recovery.  Fed Chairwoman, Janet Yellen,  speaking to a congressional hearing last month, said that while standards should have ratcheted up after the housing bubble, “it is now become the case than any borrower without a pretty pristine credit rating finds it awfully hard to get a mortgage.” 

While easing the lending standards will help some consumers, those who have high levels of debt, damaged credit from the recession or insufficient incomes to become home Buyers will have to wait for these to change in order to obtain mortgage loans. 




Harry's Bi-Weekly Update 8.4.14

by Harry Salzman


August 4, 2014



                     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.



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

Some interesting facts came to mind as I was looking over the new PPAR report yesterday.  While local sales are basically the same as they were a year ago, you will notice in the full report an “Investor Snapshot” that indicates Single Family/Patio Homes sales in July were the highest for July since 2007! 

When you consider that in July 2007 our market had 7065 listings vs. 4230 for this July, we had 40% fewer homes for sale last month than 7 years ago!  And the Average Sales Price on Single Family/Patio Homes in July was 4.0% higher than a year ago while the Average Sales Price on Condo/Townhomes was 5.3% higher. 

What does this mean?  The time to Buy is NOW.  Homes are worth more, interest rates are still historically low and while there are fewer listings, there are still plenty of choices in most price ranges.  

The local stats include “all homes”—both resale and new homes sold through July 31, 2014 as compared to July 31, 2013.

In comparing July 2014 to July 2013 in PPAR:                     

                        Single Family/Patio Homes:

  • New Listings are 1647, Down 0.7%%
  • Number of Sales are 1,199, Down 0.2%
  • Average Sales Price is $267,109 Up 4.0%
  • Median Sales Price is $230,000, Up 1.9%
  • Total Active Listings are 4,226, Up 2.2%


  • New Listings are 186, Down 16.6%
  • Number of Sales are 158, Up 5.3%
  • Average Sales Price is $163,793, Up 3.0%
  • Median Sales Price is $148,750, Up 4.5%
  • Total Active Listings are 401, Down 13.6%



                                                Median Sales Price               Average Sales Price

Black Forest                             $400,950                              $664,954

Briargate                                   $322,000                              $326,596                    

Central                                      $176,200                              $213,829

East                                           $185,000                              $185,052

Fountain Valley:                       $190,000                              $190,786

Manitou Springs:                     $325,000                              $332,545

Marksheffel:                             $271,460                              $256,492

Northeast:                                 $225,000                               $244,227

Northgate:                                $400,000                              $393,017

Northwest:                                $334,000                              $346,728

Old Colorado City:                  $167,500                               $207,601

Powers:                                     $225,450                              $225,794

Southwest:                               $265,000                               $347,439

Tri-Lakes:                                 $375,000                              $416,624

West:                                         $225,775                              $294,950

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

An interesting note in terms of financing of the 1357 total local single family/patio homes and townhomes/condos sold in July:

Financing                               Number                      Percentage of Total

Cash                                        183                              13.5%

Conventional Loan                  488                                 36%

FHA                                         186                              13.7%

VA                                           465                                 34%    

Other Financing                      35                                  2.8%

As you can see illustrated above, the majority of sales were financed either through conventional lenders or VA. 

Click here to see the full 12-page report and see how your neighborhood is doing.  If you have any questions please give me a call.



REALTORMag, KeepingCurrentMatters, Housingwire, late July issues

Lots of reasons cited, but the fallout from the housing crisis continues as the number of Americans who own homes has dropped to the lowest level in nearly two decades according to the U.S. Department of Commerce.  The percentage of homeowners today is 64.8%.  Large metro areas such were among the lowest of any in the country, but those areas were the ones hit the hardest in the housing crisis.

“The falling home ownership in recent years is partly due to the struggles of first-time buyers,” Lawrence Yun, chief economist for NAR wrote in the Economists’ Outlook blog.  “Lower wages and larger student debts among recent college graduates have limited the Millennial generation from taking advantage of the historically low interest rates.”

This is indicative of the fact that only 35.9% of those under 35 are homeowners, an historical low.

Home ownership peaked in 2004 at 69.4 percent of adult population and has been dropping steadily ever since.  There were higher numbers in the past few months, but the number of renters grew faster.  Yun said that in the past three months, the number of renter households rose by 312,000 while the number of homeowners rose by 54,000.

“The strange pattern of more homeowners but a falling home ownership rate will continue for the next two years at least,” Yun notes.  “That’s because household formation of young adults who had been living with their parents will seek out their own housing with an improving economy, first as renters before making the shift to homeowners. This trend also means that housing demand for both home purchases and rentals will be on the increase.”

As more homes come on the market, this should help increase the totals.

Other sources have cited low inventory as another reason for the low ownership rates.  According to Freddie Mac:  “Including newly built homes in the inventory count, the total number of homes for sale relative to the number of households in the U.S. has been running at the lowest level in more than 30 years.  The relatively low for-sale inventory reflects several features of today’s market.” 

According to NAR, “History shows us that a balanced real estate market requires a six month supply of available housing inventory.”  In their Existing Homes Sales Report last week, NAR revealed that we are still only at a 5.5-month supply of homes for sale.  We have not reached the 6-month mark in over two years.

This has been blamed on the recent increase in Buyers who are continuing to put a strain on this number.

Yun indicated that “Activity is notably higher than earlier this year as prices have moderated and inventory levels have improved, however, supply shortages still exist in parts of the country, wages are flat and tight credit conditions are deterring a higher number of potential buyers from fully taking advantage of lower interest rates.”

“The good news,” he said, “is that price appreciation has decreased to its slowest place since March 2012 behind much-needed increases in inventory.  With rents rising 4% annually, potential buyers are less likely to experience ‘sticker shock’ and can make smart decisions on whether or not it makes sense to buy or continue renting.”

Bottom line?  If you or someone you know are considering selling to trade up….now might be the best time to cash in on your home equity and, while a change in home ownership may not be as easy as it once was, locally we still have a decent selection available. 

Also, with the influx of renters, those looking to Buy a home for Investment might want to get in that market as soon as possible.

If you’re sitting on the fence or looking for Investment property, give me a call at 598.3200 or email me at and let’s discuss whether or not this is the right time for you.  



RealtorMag 7.28.14

The Dodd-Frank Act, which went into effect January 10, 2014 is still having an adverse effect on borrowers as lenders are trying to comply with new regulations for mortgage loans.  Hopefully as lenders find ways to deal with the regs and still make loans to eligible borrowers things will improve. 

FHA rate increases in mortgage insurance have caused borrowers to walk away and transactions to fall though according to the NAR’s second Survey of Mortgage Originators which includes questions to lenders about the impact of changes to the FHA program.  The FHA has, in recent years, increased its premium structure as a way to make up for the 2 percent capital reserve ratio it’s required to keep but lost when many loans went sour during the housing crisis. 

The rise in FHA fees is also pricing some buyers out of the market.  68.4 percent of mortgage originators indicated that they had clients who chose not to buy or who put off buying indefinitely due to the increase in FHA mortgage insurance rates.



The Gazette, 7-23 & 31, 2014

Foreclosure rates in the Springs area have fallen according to a report by CoreLogic, a California based housing data firm. 

The percentage of local area mortgage holders who were delinquent on their loan payments by 90 or more days declined to 2.5 % in May, down from 3% during the same time in 2013. 

Foreclosure notices in El Paso County were 117 in June, down 17% from May and nearly 28% lower than the same month last year.

The job market locally took another positive turn in June as the unemployment rate fell to 6.8%, the lowest in 5 ½ years and the biggest month-to-month drop since at least 2000 according to the U.S. Bureau of Labor Statistics. 

The number of Colorado Springs residents looking for jobs in June fell by more than 1400 from May, more than doubling the largest decline in the unemployed during the past 14 ½ years.

Great news for the county and good for homeowners because as the economy improves, so does the housing market.



RISMedia, 7.29.14

This is a tough one.  It’s the conversation many families put off.  And then put off some more.

It’s the discussion between elderly parents and their adult children concerning the parents’ finances. 

Lauren Brouhard, a Sr. V.P. at Fidelity Investments says that “Money is a taboo subject for families, be we do find that silence can be costly.”

“It’s a difference between destiny and certainty,” say Michael B. Cohen, an elder law attorney.  “A failure of the family to communicate will lead to mere destiny, whereas if there is a family discussion, then a plan can be discussed for certainty.  If nothing else, there will be a better understanding of what is truly important to the parent and what risks they are willing to take, if any.”

Adult children can broach the subject by using another person’s situation as an example.  That can be used as a bridge to ask the parents whether they have done estate planning and have medical documents prepared to spell out their desires.

Parents can also initiate the talk and feel secure knowing they have expressed their desires so that their wishes can be accurately carried out.

“One of people’s big fears as they age is being a burden on others,” Brouhard says.  “Taking the time to have more detailed conversations can really dramatically increase peace of mind and reduce anxiety for many families.”

“Short of these discussions there are often surprises about a parent’s wishes and what responsibilities a parent may be assuming a child may or may not be willing to take on—important matters that really impact everyone’s life in the family,” Brouhard says.

For example, a Fidelity study found a wide gap in expectations about who will care for a parent if they become ill.   Of adult children surveyed, 43% expect they or a sibling will need to handle caregiving duties.  Only 6 % of parents expect this.

It’s important for adult children to remember that these decisions are up to their parents as long as they are capable of making them.

“When it comes to finances, it’s not a democracy,’ Brouhard says.  “While different family members should have a role in the planning process, ultimately, it’s going to be up to the parents to make the important decisions that they have a right to make about their future, as well as how they disperse their assets and who’s in charge of what.”



Just a reminder that I have 4 front row seats to all Sky Sox games available to you on a first-come-first-served basis.  They’ve been going fast lately, so just give me a call and I’ll be happy to put tickets aside for you.







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Photo of Harry A Salzman Real Estate
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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