February 6, 2019



                             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.


Whoever said that “the more things change, the more they stay the same” must have certainly had Residential real estate in mind.  Some things in my industry never change—such as folks looking for a starter home, wanting to sell and trade up and of course, some looking for investment properties.  And then there are those that constantly change—such as home values, prices and mortgage interest rates.  It’s all a piece of the bigger picture of home ownership.

These last few months have seen some interesting changes.  

To begin with, interest rates are still historically low despite predictions from economists, and they look likely to remain this way for at least another few months or more.  This is providing an unforeseen opportunity for those who thought we’d seen the last of the “low” rates.  Yes, while a number of us have seen rates as high as 18% in the past, there are more and more young buyers who have only seen the historically low rates and think that 5% is outrageous!  Many of them are now realizing that their window of opportunity for a “low” rate may be closing soon.

Median home prices are starting to “normalize” and while increasing, they are doing so at a slower pace than in recent times.  That’s actually good news for both buyers and sellers.  It’s affording those who have waited to finally begin their search for a new home.  The only problem I’ve been seeing is that with inventory down, particularly at the lower end of the price spectrum, there are not a lot of homes from which to choose. This is affecting everyone, particularly those looking for starter homes.

My thoughts on all this? 

If you’re even considering a move and wondering how to make it happen, NOW is the time.  

As I’ve just told you, there are some obstacles, but fortunately for you—you’ve got ME.  My 46 plus years in local residential real estate is on your side.  I’ve seen all types of “cycles” and can help you in making your real estate dreams a reality.  We’ve caught a break with the interest rates and slower rising home prices, but…the times they keep a changing.  

Give me a call 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, your family members or co-workers who might also be looking.



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

Here are some highlights from the January 2019 PPAR report.  A look at the Median Sales Prices will show that prices are continuing to rise, although not as much as in recent months, while sales are also continuing to slow down.  

You will also see that the PPAR report is in a new format and no longer provides a look at the monthly stats for each neighborhood.  This just changed and I do not yet know if the report I share in the second eNewsletter of the month will provide this information or not.  However, if you are interested in what’s happening in your individual neighborhood, give me a call and I can provide it to you through other means.

Please click here to view the detailed 9-page report, including charts. If you have any questions about the report or to find out how it relates to your individual situation, just give me a call. 

In comparing January 2019 to January 2018 for All Homes in PPAR:


                        Single Family/Patio Homes:

·       New Listings are 1,250, Up 7.5%

·       Number of Sales are 902, Down 11.8%

·       Average Sales Price is $343,989, Up 3.4%

·       Median Sales Price is $303,450, Up 2.9%

·       Total Active Listings are 1,616, Down 30.7%

·       Months Supply is 1.8



·       New Listings are 171, Up 0.6%

·       Number of Sales are 142, No Change

·       Average Sales Price is $223,990, Up 2.4%

·       Median Sales Price is $204,500, Up 3.9%

·       Total Active Listings are 143, Up 70.2%

·       Months Supply is 1.0



The Wall Street Journal, 1.31.19

The Federal Reserve indicated that it was done raising interest rates for now at their meeting the last week in December—good news for the home mortgage market.  

In an about face from their policy stance just six weeks earlier, they voted to hold their benchmark rate steady.  While Fed Chairman Jerome Powell said at a news conference after the meeting that “the case for raising rates has weakened somewhat”, he declined to say whether the Fed’s next move was more likely to be an increase or a cut.

This is especially good news for those who were waiting due to the higher monthly payments resulting from mortgage loan rate increases.  For the present at least, rates should stay somewhat stable—a blessing for both buyers and sellers.

My advice would be not to wait too long if a move is in your future.  As I mentioned in the last eNewsletter, what goes down quickly can just as easily go up.  A word to the wise.



Keeping Current Matters, 1.22.19


One of the best measures of whether an item is more expensive than it was before is what percentage of our income it takes to purchase that item today compared to earlier times.  

Consider home purchasing:

The COST of a home is determined by three major components:  price, mortgage interest rates and wages.  In case you are wondering if we are now paying a greater percentage of our income toward monthly mortgage payments today than in previous generations—the surprising answer is NO.

Historically, Americans have paid just over 21% of their income toward their monthly mortgage payment. And while home prices are higher than in the past, the most important component in the cost equation—the mortgage interest rate—is dramatically lower than it was in the 1970’s, 1990’s and 2000’s.

According to the latest NAR Home Affordability Index, today Americans are paying 17.4% of their income toward their mortgage payment, considerably lower than the 21% average paid by previous generations.

Bottom Line? When you consider the still historically low interest rates, the cost of purchasing a home today is a bargain compared to previous generations on a percentage of income basis.  

However, as I’ve been saying for some time now, this will not always be the case.  Interest rates will NOT stay this low forever and homes are continuing to appreciate.  If you are looking to buy a starter home or trade up to a more expensive home, sooner rather than later makes the most sense.  Give me a call today and let’s see how we can make this work for you.



National Association of Realtors, 1.24.19

The Internal Revenue Service has issued final rules on the 20 percent income deduction (Sec 199A of the Tax Code) that was enacted in late 2017 as part of the Tax Cuts and Jobs Act.

Thanks to advocacy and collaboration between NAR, its members and administration, the final rules reflect many changes that NAR sought to ensure the new 20 percent deduction applies as broadly as possible.

Here are the rules on two provisions that are of importance to you if you:

1. Have real estate income, and 

2) Have exchanged properties under Sec 1031 of the tax code 

And, as always, please check with your accountant and/or investment professionals when considering how this information pertains to your individual tax situation.

Eligibility of Rental Income:

If you generate rental property income, that income can also qualify for the new deduction, as long as you can show that your rental operation is part of a trade or business.  The IRS has released proposed guidelines that include a bright-line test, or safe harbor, for showing that your rental income rises to the level of a trade or business.  Under that safe harbor, you can claim the deduction if your rental activities—which include maintaining and repairing property, collecting rent, paying expenses, and conducting other typical landlord activities—total at least 250 hours a year.  If your activity totals less than that, you can still try to take the deduction, but you’ll have to be prepared to show the IRS that your activity is part of a trade or business.

Eligibility of 1031 like-kind Exchanges:

Under earlier proposed regulations, if your income was above threshold levels set in the tax law--$157,500 for single filers, $315,000 for joint filers—and you had exchanged one property for another to defer taxes under Sec. 1031 of the tax code, the amount of the new deduction might be reduced because of the swap.  NAR and other trade groups reached out to the IRS to change this treatment, and the IRS has made that change.  Under the final rules, you can use the unadjusted basis of the depreciable portion of the property to claim at least a partial deduction.



The Wall Street Journal, 2.2.19 and HousingWire, 1.17.19

At last count, one generation of Americans owed $86 billion in student loan debt.  Its members are all over 60 years old!

The reasons are varied.  Many took out loans to help pay for their children’s tuition and are still paying them off.  Others are paying for their own student loans when they returned to school in wake of the last recession to boost their own employment prospects.

On average, student loan borrowers in their 60’s owed $33,800 in 2017, up 44% from 2010 according to data compiled for The Wall Street Journal by credit reporting agency, TransUnion.

Total student loan debt rose 161% for people aged 60 and older from 2010 to 2017—the biggest increase for any age group.

Student loan debt has impacted the housing market for several reasons.  

The above referenced seniors are either carrying second mortgage or student loan debt that makes it difficult for them to move—either to trade up or downsize—due to credit or financial concerns.

Also, the Federal Reserve recently said that student loan debt is impacting the housing decisions of young Americans too. Homeownership for adults ages 24 to 321 fell 9% from 2005 to 2014, landing at 36%, according to two recently published papers.

The Fed said that while a number of factors are at play, it attributes 2 percentage points of this decline to student debt, meaning that 400,000 borrowers could have purchased a house but didn’t due to their debt.

A chart from HousingWire  pointed out that increased student debt heightens the likelihood of default, therefore impacting an individual’s credit score and, with a weak score it may be more difficult to obtain a mortgage.

Researchers also wrote that “while investing in postsecondary education continues to yield, on average, positive and substantial returns, burdensome student loan debt levels may be lessening these benefits”.

The Fed, however, declined to say that the impact of student debt on homeownership is entirely negative, rather calling it “complex”.

Researchers wrote that “On the one hand, student loan payments may reduce an individual’s ability to save for a down payment or qualify for a mortgage.  On the other hand, investments in higher education also, on average, result in higher earnings and lower rates of unemployment”.

While this most certainly can impact the housing market in general, locally I have seen a number of recent graduates move into their first homes, some with the down payment help from family which is now acceptable by most lenders.  Others have purchased homes with help from parents while still in school and have rented out rooms to other students in order to help make the mortgage payments. 

Both of these situations will most certainly help young homeowners to start building their own financial security rather than feathering the nest of others from whom they might pay rental payments.  



UCCS Economic Forum, College of Business, updated 1.31.19

As always, I like to share with you the data I receive from the UCCS Economic Forum which shows you the “Big Picture” of the national economy as well as all the local metrics.  I’ve been a proud supporter of the Forum since its inception and know you will find the data as interesting as I do.

Please click here for the 4-page graphic depiction of the economy, and, as always, if you have any questions, please give me a holler.