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Enewsletter - September 21, 2009

by Harry Salzman





First of all, the $8000 tax credit for first-time home buyers expires on November 30, 2009. This means that, if you want to take advantage of this tax credit, your mortgage must close by November 30. As you are probably aware, there are several tasks that must be accomplished before a closing can take place, including the reception of a satisfactory credit report, appraisal, improvement location certificate, insurance commitment, home inspection, verification of personal data, removal and performance of contingent obligations to the seller, fixups from the home inspection, etc.


Now, add to the mix the fact that the participants in the closing process (lender, appraiser, inspector, title company, mortgage company) will probably be overwhelmed by applications from people who wait until the last minute to apply for this tax-credit and its probable that some applications will not be completely ready to close by November 30. Don't get left out !!!


The second reason why you should act now is that FHA credit standards and fees are increasing in response to the growing number of foreclosures. This past year, FHA has increased its minimum down payment to 3.5%. In addition, there is a one-time, upfront fee of 1.75% of the total loan amount payable at closing (but this can be added to the loan) and a .55% Mortgage Insurance Premium, payable monthly for the term of the loan.


In order to eliminate underfunded lenders, upcoming FHA increases will require lenders to show a net worth of at least $1 million (up from $250,000) and even more increases may be required in the future.


FHA appraisals will be valid for no more than 4 months (down from 6-12 months, in the past).


And, there will be additional FHA changes to tighten the mortgage market.


The moral to the story is that "He who hesitates, will probably have to rent"





RISMEDIA, announced that 26% of homes currently on the market in the U.S. as of Sept. 1, 2009 have experienced at least one price cut. Price reduction levels have increased for the fourth straight month and have seen a 10% overall increase compared to June of this year. During the summer months of June and September, the total amount slashed from home prices has increased by more than $1.1 billion from $27.4 billion to $28.5 billion. The average discount for price-reduced homes remains at 10% off of the original price.


Luxury homes have been hit the hardest during this period, with an average 14% discounted from the original asking price.


During this time of declining home prices, it's interesting to see how homeowners see the value of their homes. Four times a year, conducts a survey with Harris Interactive to get a pulse on how homeowners perceive the value of their own homes and how optimistic (or not) they are about the coming six months. This quarter's results show that homeowners, for the most part, "get it" about the bad news, but just want things to get better.


Some of the survey results are:


            22% think their home's value has increased

            19% think their home's value has stayed the same

            60% think their home's value has decreased


In reality, 83% of U.S. homes declined in value over the past year, up from 80% in the first quarter.


However, homeowners are an optimistic lot. For three quarters, respondents have predicted their homes' value would not decline any further. This quarter, the number of "optimists" was the largest yet:


            34% of homeowners think their home's value will increase

            47% of homeowners think their home's value will stay the same

            19% of homeowners think their home's value will decrease.


The most optimistic bunch are homeowners in the South and Northeast, where fewer markets experienced a "bubble" and where home value declines haven't been as precipitous as many major cities in the West.





The College of Business and Administration and Graduate School of Business of the University of Colorado at Colorado Springs sponsors the annual SCEF to bring together local experts from the public, private and economic sectors to report on our local economy. This year, the meeting will take place at the Antlers Hotel on October 30, 2009, from 8am to 12 noon. We can recommend this meeting as a great opportunity to learn about our local economy and about how things are changing in our community.



And, please remember, I would be honored to serve as your Broker for all of your residential real estate needs.


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 37 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.


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, or, about our CyberHomes Complete Market Analysis of a property, please contact us. 





A mid-level executive was so frustrated at being passed over for promotion year after year, that, in frustration, he went to a brain-transplant center in the hope of raising his I.Q. 20 points.

After a battery of physical and psychological tests, the center's director told him that he was an acceptable candidate.


"That's great!" the executive said. "But I understand that this procedure can be really expensive."

"Yes, sir, it can," the director replied. "An ounce of accountant's brain for example, costs one thousand dollars; an ounce of an economist's brain costs two thousand; an ounce of a corporate president's is forty-five thousand. An ounce of a politicians brain is seventy-five thousand dollars."

"Seventy-five thousand dollars for an ounce of a politicians brain? Why on earth is that?"

"Do you have any idea," the director asked, "how many politicians we would have to kill?"

Enewsletter - September 9, 2009

by Harry Salzman



For the sixth consecutive month, pending home sales increased in the Western U.S., according to NAR Chief Economist Lawrence Yun. This increase is in sharp contrast to the decline in pending home sales in the Northeast and in the Midwest.

NAR's pending home sales index increased 3.2% from June to July and was up 12% from a year ago, according to Yun. The index, based upon contracts signed but not closed, is at its highest level since June 2007.

One of the factors that drove this increase was the first-time home buyers tax credit of $8,000. If this tax credit is extended into 2010, it should continue to encourage home purchases. Bills pending in both houses would extend the credit for another year and Senate Banking Committee Chairman Sen. Chris Dodd, D-Conn is co-sponsoring a bill by Sen. Johnny Isacson, R-Ga., that would increase the maximum amount of the credit to $15,000.


 In his column in the Wall Street Journal, Sept 2, 2009, James B. Stewart, a columnist for SmartMoney magazine, states: 

 "The data suggest that real estate prices hit bottom some time during the second quarter, and have now begun to rise ..Clearly, prices are no longer in free-fall. That means if you've been sitting on the fence, it's time to act. .I can't imagine a better time to buy than now"

I couldn't have said it better, myself.


Last week we attended a day-long presentation sponsored by the Department of Housing and Urban Development, US Government, explaining the new federal regulations regarding Good Faith Estimates and HUD-1. The good news is that, starting on January 1, 2010, Buyers will be better protected against last-minute surprises at closings. The bad news is that:

1.     Because of the additional paperwork involved, lenders will probably increase their fees, and,

2.     Because of the strictness of the new regulation, the possibility exists that Buyers and/or Sellers might have to re-close on what should have been a "done-deal". (Imagine a Seller, waiting in his new city for the moving van containing all of his  furniture, being notified that funds to pay the movers would not be available until a new closing is scheduled).

It's true that, in the past, too many closings have been marred with last-minute charges and/or fees that resulted in bad feelings, postponement or even cancellation of the closing. The new regulations will hold all parties (Buyers, Sellers, Lenders and Title Companies) accountable for meeting deadlines and providing firm Good Faith Estimates in a timely manner, so that Buyers and Sellers will know exactly what to expect at the closing.

 The bottom line for Buyers and Sellers is that utilizing the services of a professional, experienced Realtor who has good working relationships with dependable, local lenders and title companies will still be the key to successful closings.

 I would be honored to serve as your broker for all of your residential real estate needs.

And, if you know of anyone who is moving in or out of the Pikes Peak region, remember that, with over 35 years of providing relocation 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. 


 Although local sales in August were up, both the average and the median prices of homes sold during the month of August declined slightly. We attribute this decline to two factors. First, local Sellers are finally facing the current market realities and are pricing their listings accordingly. Secondly, the typical first-time Buyer, i.e. the Buyer who is using the First-Time Buyer Tax Credit, is usually in the market for a lower-priced home. Click here to see the complete August statistics for our area.   


A short history of health care:

1 A.D.      - I don't feel so good !!  Oh, that's too bad ! Here, eat this root.

1000 A.D. - That root is heathen, say this prayer.

1700 A.D. - That prayer is superstition, drink this potion.

1800 A.D. - That potion is just snake oil, swallow this pill.

1950 A.D. - That pill is old fashioned and ineffective, take this antibiotic.

2000 A.D. - That antibiotic is artificially produced and not organic. Here, eat this root.

2009 A.D. - That root has been banned by the FDA. Fill out this form in triplicate, get in line and, in about three months, the government will let you know if you qualify for treatment.


2010 A.D.  -  I don't feel so good !! Oh, that's too bad ! Here's the phone. Call your congressman. 

Displaying blog entries 1-2 of 2




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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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