June 20, 2016

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.

“SPRING BUYING SEASON” HAS BEEN HOTTER THAN EVER….AND I’M NOT EVEN TALKING ABOUT THE RECORD SETTING TEMPERATURES

Today is the first day of Summer and I’ve been busier these last few months than any Spring Buying Season I can ever recall. It seems like everyone either wants to sell and trade up, buy for the first time or buy for investment purposes.  I’m getting calls from folks I haven’t heard from in a number of years as well as those who have seen my “SOLD” sign on homes in their neighborhood. 

It makes perfect sense to me.  Interest rates are still historically low, and while there is still talk of the Federal Reserve raising rates in the future, it doesn’t seem to be affecting the mortgage interest rates at this point.   As a matter of fact, mortgage loan rates moved lower this week for the second straight week and are currently the lowest since May 2013.

And as I mentioned in the last edition, banks and other mortgage lenders are easing up in terms of down payment and credit requirements.  This is especially good for first time buyers, as they often do not have the cash for a large down payment and more than likely have little or no credit experience. 

Rental rates are increasing each month and Colorado Springs is leading the nation in that category.  This is creating opportunities for not only first-time buyers but also for first-time investors or for those who have been thinking about adding to their investment property portfolio.  Unfortunately these starter homes go quickly and it takes a seasoned real estate Professional such as myself to figure out a way to have a first offer get noticed and ultimately accepted.

Listings are still way down, but I’m finding that there is something for everyone as long as they know what they want, need and can afford prior to the home search.  Getting pre-approved from a lender is a must and it’s very important to be able to make a decision quickly once you find the home you want.  The days of mulling it over for a few days are a thing of the past. 

If you, a family member, co-worker or friend are ready to start the ball rolling on residential real estate—either for the first time, as a seasoned buyer or for investment purposes, please give me a call at 598.3200 or email me at Harry@HarrySalzman.com and let me put my 44+ years experience to work in helping achieve whatever goals you or they have. 

 

MORTGAGE INTEREST RATES ARE STILL HISTORICALLY LOW

The Wall Street Journal, 6.18-19.16, RealtorMag, 6.19.16

Last Wednesday, the Federal Reserve held short-term interest rates steady, and officials lowered projections of how much they will raise them in coming years.  This is excellent news for consumers who have not yet taken advantage of historically low rates, or who were held back due to lack of equity in their present home. 

Rates for a 30-year-fixed mortgage fell to 3.52% and Jumbo mortgage rates fell to 2.77%, according to Bankrate.com, which based rates on a survey of over 4,800 online banks. 

Banks and other mortgage lenders are welcoming the increased mortgage loan business because it helps offset pressure from falling bond yields.  Most are passing these savings on to their customers, and Wells Fargo recently said that it expects origination volume industry-wide to be 20% to 25% higher for the year than it had initially anticipated. 

With an easing of qualifications and lower rates, hopefully this will translate into more first-timers being able to enter the market and will help those who were unable to participate in the first wave of low rates to be able to reconsider and find their way back into the market. 

If you are wondering how these low rates and easier qualifications can work for you, simply give me a call and let’s see how we can make your residential real estate dreams come true.

 

STUDENT DEBT IS PREVENTING BOTH BUYERS AND SELLERS FROM ENTERING THE real estate MARKET

RisMedia, 6.16.16

According to a new joint survey on student loan debt and housing released by the NAR and SALT®, a consumer literacy program provided by nonprofit American Student Assistance, “71% of non-homeowners repaying their student loans on time believe their debt is stymieing their ability to purchase a home, and slightly over half of all borrowers say they expect to be delayed from buying by more than five years”.

The results also revealed that student debt postponed 4 in 10 borrowers from moving out of a family member’s household after graduating college.

Nearly three-quarters of non-homeowners polled in the survey believe their student loan debt is delaying them from buying a home.  The highest share is among older millennials approximately aged 26 to 35 and those with $70,000 to $100,000 in total debt.  Regardless of the outright amount of student debt, more than half of non-homeowners in each generation report that it’s postponing their ability to buy.

Lawrence Yun, NAR chief economist, says the survey findings bring to light the magnitude student debt is having on the housing market and the budget of even those financially able to make on-time payments on their student loans. 

While obtaining a college degree increases the likelihood of stable employment and earning enough to purchase a home, many who graduate with this kind of debt are putting homeownership on the backburner in part because of the multiple years it takes to pay off their student loans at an interest rate that’s oftentimes nearly double current mortgage rates.

“A majority of non-homeowners in the survey earning over $50,000 a year--which is above the median U.S. qualifying income needed to buy a single-family home—reported that student debt is hurting their ability to save for a down payment,” Yun says.  “Along with rent, a car payment and other large monthly expenses that can squeeze a household’s budget, paying a few hundred dollars every month on a student loan equates to thousands of dollars over several years that could otherwise go toward saving for a home purchase.”

Among those non-homeowners who believe student debt is delaying their ability to buy, over three-quarters—including over 80% of millennials—said their delay is because they can’t save for a down payment.  Also, 69% don’t feel financially secure enough to buy and 63% can’t qualify for a mortgage because of high debt-to-income ratios.

A majority of those surveyed expect to be delayed by more than five years from purchasing a home due to student debt.  Those with higher amounts of student debt and those with lower income expect to be delayed the longest, as would be expected.

The survey also found that student debt is affecting the overall housing supply by holding back some current homeowners who otherwise would like to sell and trade up.  Nearly 1/3 of current homeowners surveyed said their student debt is postponing them from selling their home and purchasing a new one. 

“It is imperative to the nation’s economy that we find immediate and practical solutions to financially empower the 43 million Americans with student debt,” says SALT® President John Zurick.  “SALT® is committed to demystifying the college financing process by giving consumers information, instruction and individualized advice.  No one should not realize the full potential of their formal education simply because of finances.  We invite the higher education community, the U.S. government, the private sector and others to join with us in this movement.”

As a REALTOR® I didn’t need to read about this survey to know the problems concerning student debt and the ability to purchase a home.  I come across this stumbling block regularly.  It IS “imperative” that we find a solution and I am working diligently behind the scenes at present to see what can be done to help alleviate some of these problems.  Stay tuned for more information as it becomes available.

 

SELLERS:  WHAT EVERY BUYER WANTS TO KNOW ABOUT YOUR HOME

RisMedia, 6.8.16

With high demand and sales at their strongest in close to a decade, home sellers are in an advantageous position this summer.  Here are a few specific items that every buyer wants to know prior to purchasing a home they are considering.  Some of this is information that may seem premature to advertise initially, but could ultimately be determining factors in a buyers decision to make an offer.

  • How old is the home?  When was it last renovated?  How old is the roof?

 

  • What structures or fixtures are included in the list price?  (Appliances, ceiling fans, lighting, shed, swing set, window treatments, etc.)

 

  • What are the home’s annual costs? (Electric, municipal water, gas, oil, lawn care, pool maintenance, etc.)

 

  • Has the home required asbestos, lead or mold removal?  Has the home been tested for radon?

 

  • How is the home heated and/or cooled?  How old is the heating and/or cooling system?  How old is the hot water heater?

 

  • How is the wiring?  Is it up to code?

 

  • Has the well water been tested?

 

  • Is/was an oil tank buried on the property?  Is there a septic system, cesspoll or drywell?

 

  • Are there any outstanding permits or liens on the property?

 

  • What are the homeowners association fees?  What is the move-in fee?  What amenities or services are provided by the HOA?

By providing these answers upfront you meet prospective buyers on their terms which could lead to an offer that much sooner or one that won’t fall apart due to answers they get at a later date. 

 

SKY SOX TICKETS ARE YOURS FOR THE ASKING

Another reminder--I have four first row seats right behind the home team dugout.  These are yours for the asking, but on a first-requested, first-served basis.  Just give me a call and I will be happy to reserve tickets for you for any home game of the season.