Real Estate Information

                                                

June 2, 2015

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.

 

A” SHOUT-OUT” TO STEVE BACH AND JOHN SUTHERS…

I want to take a moment to thank Colorado Springs Mayor Steve Bach for his leadership as the first “strong” mayor in the City’s history and to wish incoming Mayor John Suthers much success in leading his “hometown”. 

Having worked with both of these men over the years, I have the utmost respect and admiration for the time and dedication they have given, and continue to give, to our City. 

So…Thank You, Steve for your service…and Best Wishes, John in making the transition to Mayor of Colorado Springs, effective today.

 

MAY LOCAL STATISTICS CONTINUE THE POSITIVE GROWTH TREND

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

PPAR released May statistics late yesterday afternoon and I waited to share what I anticipated to be more good news, thus the eNewsletter coming to you a day later than usual.

Once again, I am thrilled to report that things are looking very good for the Pikes Peak Region in the Residential real estate market. 

May was the tenth straight monthly increase in sales.  In comparing month over month, May 2015 to April 2015, the number of sales in Single-family/Patio Homes is up 24.3%, with the Average Sales Price up 4.2% and the Median Sales Price up 3.4%. New listings were up just slightly (0.4%) over April.  In the Condo/Townhomes category, everything but new listings is up from April. 

Also taking into consideration the very positive year-over-year statistics shown below, you can see that these numbers reflect strong consumer confidence along with low, but slowly rising, interest rates that many buyers feel will soon go higher.  “Act now” continues to be the current norm.

Listing numbers continue to drop, both locally and on the national level.  With rental rates rising and first-time buyers becoming more active, we are most definitely facing a Seller’s Market.  That doesn’t mean you won’t be able to find the home you might be looking for, but it does mean that you might have others who want the same property. 

I still find that most of my buyers are able to sell and trade up as long as they are realistic about the current market conditions and are able to make a quick decision once they find the property they want to buy. 

Here are some highlights from the May 2015 PPAR report.  Please click here to view the detailed 13-pages. The included charts will show you just how positive these statistics are. If you have any questions, as always, just give me a call at 598.3200.

In comparing May 2015 to May 2014 in PPAR:                      

                        Single Family/Patio Homes:

• New Listings are 1839 Down 2.5%
• Number of Sales are 1,397, Up 24.3%
• Average Sales Price is $276,946, Up 13.9%
• Median Sales Price is $243,000, Up 12.4%
• Total Active Listings are 2,889, Down 27.9%

                        Condo/Townhomes:

• New Listings are 218, Up 3.8%
• Number of Sales are 207 Up 43.8%
• Average Sales Price is $172,126, Down 1.2%
• Median Sales Price is $156,000, Up 4.0%
• Total Active Listings are 286, Down 32.7%

 

COLORADO SPRINGS AREA MONTHLY SINGLE FAMILY/PATIO HOME SALES ANALYSIS*

                                                Median Sales Price             Average Sales Price

Black Forest                            $435,000                              $455,698

Briargate                                  $310,000                             $322,419        

Central                                      $201,500                              $228,074

East                                           $210,950                              $219,858

Fountain Valley:                       $208,000                              $207,255

Manitou Springs:                      $242,100                              $252,025

Marksheffel:                              $259,450                              $274,845

Northeast:                                 $231,750                              $258,919

Northgate:                                 $387,000                              $449,891          

Northwest:                                $339,375                              $368,894

Old Colorado City:                   $200,000                              $229,287

Powers:                                     $229,700                              $238,794

Southwest:                                $358,000                              $431,348

Tri-Lakes:                                  $417,000                              $440,483

West:                                         $224,500                              $252,084

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

 

SOUTHERN COLORADO ECONOMIC FORUM’S QUARTERLY UPDATES & ESTIMATES

College of Business and Administration, UCCS, Southern Colorado Economic Forum, May 2015

The First Quarter 2015 Update on the El Paso County Economy, including housing trends, was published last week and you can click here to read the 9-page report in full.  Here are some of the highlights I thought you would find interesting:

• Single-family permit activity has trended upward over the past five years.
• The year-to-date-sales in the Pikes Peak Region are also continuing an upward trend.
• Active listings are lower than a year ago, but the average sales price of a home sold in March 2015 is 9.3% higher than March 2014.  This points to stability in the local real estate market, which is favorable.
• Foreclosures were 46.6% fewer than in the same period last year.

The next several sections of the report include:

• Colorado Springs Airport Trends
• Employment Trends and Wages
• Colorado Springs Sales Taxes
• New Car Registration Trends

It is with pleasure that Salzman real estate Services is able to share these types of statistics and forecasts with you as soon as they become available, each and every quarter.  We have been a supporter of the Southern Colorado Economic Forum since it was created by the UCCS College of Business in 1996.

This year the Forum is going to be held on Friday, October 23 and will be at The Broadmoor for the first time.  The program will feature an exciting keynote speaker and some new features that you won’t want to miss.  I’ll provide more details as they become available but you might want to mark your calendars now to save the date for this sure-to-be-sold-out event.

 

LOCAL COST OF LIVING AT 2-YEAR LOW, JOB MARKET BEST IN 9 YEARS

The Gazette, 5.28-29.15

The cost of living for Colorado Springs was 4.6% below the national average for the first quarter of 2015, according to a quarterly survey by the Council for Community and Economic Research.  Compared with 2.6% below for all of 2014, which was an 11-year high, this is great news.  Much of this is due to low gasoline and natural gas prices. 

Health care and miscellaneous goods and services were also lower, while first-quarter housing costs jumped from slightly below to slightly above the national average.

“This is confirmation that Colorado Springs is a very affordable place to live, work and own and operate a business,” said Dirk Draper, CEO of the Colorado Springs Regional Business Alliance.  “It also reflects a welcome slowdown in the trend of increasing costs.”

“It is a favorable reflection of our place among the other cities along the Front Range, particularly since our housing costs remain more affordable than other cities along the northern Front Range,” he added.

Not surprisingly, along with the lower cost of living comes the fastest job growth rate since 2006.  The latest estimates are from the Colorado Department of Labor and Employment and won’t be confirmed by the U.S. Bureau of Labor Statistics until its annual review process in March 2016, buy Alexandra Hall, the department’s chief economist expects the numbers to hold up.

“Colorado Springs, particularly over the past year or so, has seen a consistently strengthening economy,” Hall said.  “I don’t expect to see as much impact on the Colorado Springs economy from the slowing in the oil and gas industry that we will see in the rest of the state.”

Most of the job gains came from the health care and social assistance sector.  Other big gains came from tourism, construction and professional and technical services industries. 

 

MORTGAGE RATES NOW AT HIGHEST POINT THIS YEAR

Realtormag 5.29.15, The Wall Street Journal, 5.23-24.15

In its weekly mortgage market survey, Freddie Mac reported that fixed-rate mortgages moved to their highest point this year.  While still historically low, this is a fairly good indication of even higher rates to come. 

According to Janet Yellen, Federal Reserve Chairwoman, the central bank is on tract to raise interest rates this year but will likely do so cautiously as the job market hasn’t fully healed from the recession.  She indicated last Friday that it could take as long as several years before the Fed’s benchmark short-term rate is back to what the central bank considers “normal” in the long-run. 

However, the Labor Department reported signs that inflation is stabilizing, which should give the Fed more confidence when considering the rate raise. 

“I think it will be appropriate at some point this year to take the initial step to raise the federal-funds rate target and begin the process of normalizing monetary policy,” Ms. Yellen said last Friday.

What does this mean to you?  Well, rates ARE going up.  Maybe slowly for the time being, but as soon as the Fed feels confident the economy can handle it, they will go up even more.  For those waiting for lower rates, I would doubt that’s going to happen.  And while the rates are still low at present, again, that’s NOT going to last forever.  If you want to take advantage of what has been once-in-a-lifetime low mortgage interest rates, don’t delay. Enough said.

 

WHERE ARE PRICES HEADED IN THE NEXT 5 YEARS?

Keeping Current Matters, 5.26.15, pulseconomics, 5.15

Every quarter, Pulseonomics surveys a nationwide panel of more than one hundred economists, real estate experts and investment and market strategists about where prices are headed over the next five years.  Those are then averaged into a single number to get the results.  The latest survey of Quarter 2, 2015 shows the following:

• Home values will appreciate by 4.3% in 2015
• The cumulative appreciation will be 19.4% by 2019
• That means the average annual appreciation will be 3.6% over the next 5 years
• Even the experts making up the most bearish quartile of the survey are still projecting a cumulative appreciation of 11.8% by 2019

Here are a couple of graphs illustrating the survey results:

 

 

 

 

WAITING TO BUY A HOME COULD COST TENS OF THOUSANDS

Housingwire, 5.28.15

The first Opportunity Cost Report from realtor.com was released several days ago and it indicated that with interest rates and home prices expected to climb in the next year, the financial penalties of delaying or forgoing a home purchase in today’s market have become quite steep.

Examining a wide range of factors, including the long-term impact of owning versus renting a home, the likely monetary gain renters forego in waiting to buy and the financial benefits of homeownership by market, the consensus was the time to buy is NOW.

“Current market conditions give buyers the opportunity to build substantial wealth in the long-term, compared with renters and later buyers, in advance of the projected increase in mortgage rates and continuing price appreciation,” said Jonathan Smoke, chief economist for reator.com.  “The problem is inventory is low, which has many would-be home buyers—especially first-timers—standing on the sidelines and missing out on potentially material financial gains.” 

Nationally, the estimated wealth an average buyer would accumulate over a 30-year period based on today’s dollars totals $217,726.

Bottom Line?  Once more, another good reason not to wait if you’ve been renting or considering a starter home.  If you or any family members are looking to be first-time homeowners, now is the time to make the move.  With new mortgage programs offering lower down payments and allowances for financial help from family members, now is an excellent time to get the process underway.  Give me a call at 598-3200 or email me at Harry@HarrySalzman.com and let’s see what we can do to help make your homeownership dreams a reality.

 

A REMINDER ABOUT SKY SOX TICKETS                                           

                           

Now that the rainy weather is gone, baseball games are back in full swing.  Don’t forget to get your request for tickets in early so you can attend the game of your choice.  We have 4 front row seats located directly behind the Sky Sox dugout that can be yours free for the asking.  They are on a first-come, first-served basis so give me a call today to reserve yours. 

 

HARRY’S JOKE OF THE DAY 

 

AND SOME THOUGHTS ON ATTITUDE I WANTED TO SHARE…

 

“Attitude is a little thing that makes a big difference.”  --Winston Churchill

 

“Ability is what you’re capable of doing. 

Motivation determines what you do.

Attitude determines how well you do it.”  --Lou Holtz

 

“Weakness of attitude becomes weakness of character.”  --Albert Einstein

 

 

 

Housing is on a steady path to recovery as I’ve just mentioned and home prices nationally have risen approximately 20% in the last three years, according to the Federal Housing Finance Agency (FHFA) and Standard & Poor’s (S & P) Case-Shiller house price indices—and both consumer and industry professionals expect this upward trend to continue through 2015.

The anticipated increase is the result of intersecting economic factors that make up the big picture that is today’s housing market.

What’s impacting prices now?

• Wages and inflation.  A recent study by RealtyTrac illustrates a disconnect between home price growth and wage growth, despite the improved economy.   Between 2012 and 2014 home prices increased by 17% while wages increased only 1.3%--a 13 to 1 disparity.  Also, home prices continue to outpace inflation rates according to S & P, growing twice as fast in 2014.

According to Nobel Laureate Robert Shiller, inflation rates likely affect home prices only indirectly.  Because pay increases often boost perceptions of buying power, inflation may have a greater impact on consumer confidence, which, in turn, could also boost housing activity.

 

• Interest Rates and Inventory.  Interest rates do tend to be influenced by inflation rates.  Mark Palim, Fannie Mae V.P., Economic & Strategic Research Group, says that while it’s reasonable to assume rising mortgage-interest rates equal falling house prices, there’s little evidence of a casual relationship between the two.  In fact, higher mortgage rates have a tendency to predicate a decrease in purchases rather than a dip in prices.

Interest rates DO play a role in overall affordability.  Today’s rates have significantly accelerated demand in many markets.

“The biggest factor in price gains has been the current low interest rates spurring demand,” says Gabe Sanders of BlueWater real estate in Stuart, FL.  “And our low inventory, which makes buyers willing to spend more, since they can’t find enough available in lower-priced properties.” 

In Sanders’ market, prices on the lower end have risen much more than those of mid-range, similar to those price increases in the Pikes Peak area.  This demonstrates what’s being experienced nationwide—escalating prices, due to a shortage of affordable listings—which have adversely tipped the scale, especially for first-time homebuyers.

The solution?  According to Lawrence Yun, new construction gains are essential to counter the lack of inventory and rise in prices.  He says that post-crash, single-family construction has been slow to pick up steam, primarily because of construction costs that fail to meet buyer expectations.

 

• Demographics.  Generational shifts have historically affected demand and caused price increases in the housing market.  Today this is due to baby boomers and millenials, although some of the latter have been priced out of the market due to statistically lower incomes and sluggish wage and job growth.  Too few first-time buyers are also hurting those seeking to sell and trade up or relocate. 

In some areas, such as Beverly Hills, international buyers are driving up prices to an all time high due to the area’s high-end status and temperate climate.  Hint to Pikes Peak area homeowners—let’s not tell them about all the wonderful reasons they might want to relocate here!

 

• Oil Prices.  Home prices in the near future could be affected by another distinct market trend.  With the decline in oil prices, markets with oil economies may see home prices drop at the end of the year into 2016, according to a report by Trulia.  On the other hand, non oil-producing markets, may see a boost in prices.  These findings are similar to oil and home price fluctuations since the 1980’s.

 

While many factors go into the home pricing scenario, these large-scale influencers play a predominant role.  Home prices in the Pikes Peak area are affected by decisions of the Department of Defense (DOD) and other factors that might not affect the country in general. 

As I’ve said time and again, there is a housing solution for most all who are looking.  That’s why it is so important to find a knowledgeable, competent real estate Professional to help you navigate through the home Buying and Selling waters.  

We do the homework, know the area and can help you price your current home right.  Too high won’t get potential buyers, and too low will leave money on the table—neither one a good option.  And most importantly, we work for you.  Your goals become ours and since we are not as emotionally involved, we can help keep you on track when you possibly find yourself in a bidding war when buying a home.  “Winning the battle but losing the war” is NOT the outcome a good real estate Professional advocates for you. 

 

FIVE MISTAKES PEOPLE MAKE WHEN SELLING A HOME

Cheatsheet.com 4.13.15, Realtor mag, 4.13.15

A survey by the NAR found that 83% of people view their home as a good financial investment.  Not only is it a good investment, but it’s also filled with tons of personal memories since the average homeowner has lived in his or her home for a decade or more.  Therefore, when it’s time to sell, no matter the reason, it’s easy to become more than a little emotional.  Another reason to consult a knowledgeable, competent real estate Professional.

Letting emotions, rather than knowledge, drive home selling decisions can make it difficult to find a buyer or force you into accepting a lower price than you might like.

The best news is that the market is tight and it’s a Seller’s Market at the moment.  That’s pushing up prices and the NAR says that “the typical seller receives 97% of his final asking price and the home was on the market for about a month.”

That doesn’t mean every home sells quickly or every seller gets the price they wanted, but the chances are much better if you avoid these five mistakes when listing your home.

1. Not being realistic about your home’s value.  What you think your home is worth and what you can actually sell it for are often two very different numbers.  Unfortunately nobody cares what you paid for it nor what you put into it.  All that matters is what you can realistically sell it for today. 

Even in a Seller’s Market you need to be careful to price your home realistically.  Properties that are overpriced at the outset tend to eventually sell at a lower price than they would if they had been appropriately priced in the first place.

Choose a price based on factors like comparables and appraised value.  If you’re not getting any interest, adjust your strategy.  According to an article by a Realtor in The Washington Post, “no offers within a 30-day period means the price is too high”.

 

2. Not making your home looks its best.  Simply from watching HGTV and the like, we now know that good staging and curb appeal help to sell homes.  “At a minimum, homeowners should conduct a thorough cleaning, haul out clutter, make sure the home is well-lit and fix any major aesthetic issues,” said Chris Polychron, President of NAR, in a statement about the value of home staging.  Simply repainting with neutral colors, sprucing up landscaping or purchasing new furniture can help.  According to the real estate Staging Association, “Overall, professionally staged homes can sell five to seven times faster than non-staged homes”.

 

3. Refusing to negotiate.  When setting a fair and reasonable price for your home you should build in some “wiggle room”, especially if you need to sell quickly.  Many buyers want to feel they are getting the best deal on what is probably the biggest purchase of their lives.  Therefore, most will make an offer considerably below your asking price, particularly if they think it’s a buyer’s market. 

You can make your buyers happy while also getting the price you need by being willing to accept slightly less than asking price for your home.  Alternately, you might agree to concessions like paying the closing costs, throwing in extra appliances or making certain repairs to the property in order to sweeten the deal.  An experienced Broker like me can help you negotiate the tricky dance of getting the price you want without scaring off a potential buyer. 

 

4. Hiding the truth about your home.  Trying to cover up or hide problems with the home from potential buyers is not a good idea.  Serious flaws, like foundation problems, leaky roofs, or mold, could come to haunt you later.  If you aren’t upfront about the problems at the start, the buyer will likely find them out during the home inspection.  This could result in the buyer withdrawing his offer or asking you to fix the problem.  If the issue is serious enough and isn’t discovered until after the sale, this could result in costly litigation.

Zillow, the real estate website, recommends being upfront with both your listing Broker and your buyer about any potential issues with your home.  You can then price the home accordingly and document the problems you’re aware of and have the buyer sign off on them to avoid legal issues later. 

 

5. Not having a backup plan.  In a perfect world, you sell your current home and buy a new one without any difficulty.  In reality, that’s not always the case, especially in a Seller’s Market.  Smart sellers have contingency plans in place to avoid either getting stuck with two mortgages at once or not having a place to live, or to protect them if a deal falls through.

You may want to be prepared to find temporary housing, like a rental or staying with family if your home sells too quickly.  If you must move before selling your current home, make sure you’ve budgeted enough to afford carrying the cost of the old home.  And lastly, if there are multiple people interested in your home, you may be able to accept backup offers, which involve agreeing to sell to a second buyer if the first one backs out.

 

Planning ahead can most certainly help when it comes to selling your home.  Today’s market, with faster turnaround times, makes it even more crucial that you have a good idea of your next move and be ready to carry though on it.  A little forethought can save you a lot of potential headaches down the stretch. 

 

SKY SOX TICKETS ARE YOURS FOR THE ASKING

Just a reminder that baseball season is in full swing and Salzman real estate Services has four first row seats, right behind the Sky Sox dugout.  These are available for free on a first-come, first served basis.  They go quickly, so please call 598.3200 and let me know what game you’d like tickets for and I will put them aside for you to pickup prior to the game.

 

HARRY’S JOKES OF THE DAY

A real-estate agent, had difficulty getting a listing from a customer whose theory was that "there is no substitute for experience." After he asked her a third time how many years she had been in the business, she told him: "Sir, there is a little-known historical fact that Moses brought three tablets down from the mountain-two were the Ten Commandments and the other was my real-estate license!" She got the listing.

------------------------------------

A broker was dismayed when a brand new real estate office much like his own opened up next door and erected a huge sign which read 'BEST AGENTS.'

He was horrified when another competitor opened up on his right, and announced its arrival with an even larger sign, reading 'LOWEST COMMISSIONS.'

The broker panicked, until he got an idea. He put the biggest sign of all over his own real estate office. It read: 'MAIN ENTRANCE'.

           

 

                                                

May 4, 2015

 

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.

 

APRIL LOCAL STATISTICS CONTINUE THE POSITIVE GROWTH TREND

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

PPAR released April statistics on Friday and I am thrilled to report that things are continuing to look very good for the Pikes Peak Region in the Residential real estate market. 

April was the ninth straight monthly increase in sales. Sales in Single-family/Patio Homes were up 11.4% over March, with the Average Sales Price up 2.5% and the Median Sales Price up 4.4%. New listings were up 12.8% over March.  In the Condo/Townhomes category, everything but sales were up from March; however, year-over-year sales were up 37.2% as you will see. 

These numbers continue to reflect stronger consumer confidence along with continued historically low interest rates that many Buyers feel will soon go up.  “Act now” appears to be the current norm.

Here are some highlights from the monthly PPAR report.  Please click here to view the detailed 13-page report. The included charts will show you just how positive these statistics are. If you have any questions, please give me a call.

In comparing April 2015 to April 2014 in PPAR:                       

                        Single Family/Patio Homes:

• New Listings are 1831 Up 6.5%
• Number of Sales are 1,124, Up 21.9%
• Average Sales Price is $265,800, Up 10.3%
• Median Sales Price is $235,000, Up 10.1%
• Total Active Listings are 2,694, Down 27.0%

                        Condo/Townhomes:

• New Listings are 246, Up 24.9%
• Number of Sales are 129, Up 37.2%
• Average Sales Price is $166,814, Up 8.6%
• Median Sales Price is $145,000, Up 6.2%
• Total Active Listings are 281, Down 27.0%

 

COLORADO SPRINGS AREA MONTHLY SINGLE FAMILY/PATIO HOME SALES ANALYSIS*

                                                Median Sales Price             Average Sales Price

Black Forest                            $390,000                              $442,863

Briargate                                  $297,750                              $325,855        

Central                                      $180,000                              $222,440

East                                           $198,750                              $221,314

Fountain Valley:                       $206,000                              $209,831

Manitou Springs:                     $376,500                              $313,214

Marksheffel:                             $248,000                              $262,784

Northeast:                                $218,500                              $240,295

Northgate:                                $411,000                              $432,810           

Northwest:                                $317,000                              $336,953

Old Colorado City:                   $265,000                              $251,367

Powers:                                     $224,950                              $232,483

Southwest:                                $288,000                              $360,391

Tri-Lakes:                                  $368,000                              $404,367

West:                                         $252,000                              $270,181

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

 

THREE QUESTIONS TO ASK YOURSELF BEFORE BUYING A HOME

Keeping current matters, 4.21.15

If you are thinking about purchasing a home right now, there’s a lot of advice out there.  Friends and family as well as internet sites may have a lot of information, but it’s important to be fully aware of your actual needs and local real estate trends in order to make an informed decision.

There are three questions you should ask yourself before purchasing a home in today’s market:

1. Why am I buying a home in the first place? 

This is by far the most important question to answer.  A study by the Joint Center for Housing Studies at Harvard University reveals that the four major reasons people buy a home have nothing to do with money:

• A good place to raise children and for them to get a good education
• A place where you and your family feel safe
• More space for you and your family
• Control of the space

What non-financial benefits will you and your family derive from owning a home?  The answer to that question should be the biggest reason you decide to purchase or not.

2. Where are home values headed? 

Home Price Expectation Survey, published every quarter, can provide a fair assessment.  Pulsenomics surveys a nationwide panel of over 100 economists, real estate experts and investment and market strategists about where prices are headed over the next five years.  They then average the projections of all 100+ experts into a single number.  Here’s what the most recent survey revealed:

• Home values will appreciate by 4.4% in 2015.
• The cumulative appreciation will be 19.3% by 2019
• Even the experts making up the most bearish quartile of the survey are still projecting a cumulative appreciation of over 11.7% by 2019

3. Where are mortgage interest rates headed?

A buyer must be concerned about more than prices.  The “long term cost” of a home can be dramatically impacted by an increase in mortgage rates.  The Mortgage Bankers Association (MBA), the NAR and Freddie Mac have all projected that mortgage interest rates will increase by approximately one full percentage point over the next twelve months.

I would stress one more important factor when making a decision about whether it’s the right time for you to buy a home.  Make certain you contact a competent, professional real estate Professional.  When presented with all your wants, needs, and budget constraints a competent broker can give you the best advice concerning today’s market and can address all your concerns prior to beginning the search.  And, if it appears that now is NOT the right time for your individual situation, he or she will be able to tell you that also. 

There have been more than several times in the last year that I have advised clients that it just didn’t make sense for them to purchase a home based on the information they provided me. 

I do the homework, know the market, and can help you make your home buying decision based on actual facts.  If you or any family member or co-worker is thinking of buying a home, please call me at 598.3200 or email me at Harry@HarrySalzman.com and let me help determine if it’s the best decision at the present time. 

 

NATIONAL HOME SALES AT 18-MONTH HIGH

RealtorMag 4.23.15, RisMedia, 4.30.15

Spring residential home sales are strong all over the country, with existing-home sales surging to the highest rate since September 2013.  More homes also went on the market, thus relieving some inventory constraints we’ve had, according to the latest NAR report.

Some highlights from the report:

• Properties typically stayed on the market for a shorter time in March than in February.  Short sales were on the market the longest, with foreclosures and non-distressed homes selling in one-third the time of short sales.  Forty percent of homes sold in March were on the market for less than a month.
• All-cash sales represented 24 percent of transactions in March, down from 33 percent a year ago.  Individual investors, who account for many cash sales, purchased 14 percent of the homes in March, vs. 17 percent a year ago.
• Distressed sales accounted for 10 percent of sales in March, down from 14 percent a year ago.

According to Lawrence Yun, chief economist for NAR, contract signings picked up in March as more buyers than usual entered this year’s competitive spring market.  “Demand appears to be stronger in several parts of the country, especially in metro areas that have seen solid job gains and firmer economic growth over the past year,” he says.  “While contract activity being up convincingly compared to a year ago is certainly good news, the increased number of traditional buyers who appear to be replacing inventors paying in cash is even better news.  It indicates this year’s activity is being driven by more long-term homeowners.”

Yun expects a gradual improvement in home sales in the months ahead but says insufficient supply and accelerating prices could be a drawback to sales reaching their full potential.

He added, ”The modest rise in housing supply at the end of the month despite the strong growth in sales is a welcome sign.  For sales to build upon the current pace, homeowners will increasingly need to be confident in their ability to sell their home while having enough time and choices to upgrade or downsize.  More listings and new-home construction are still needed to tame price growth and provide more opportunity for first-time buyers to enter the market.”

Bottom Line?  With prices increasing, housing supply better but still low, and the inevitability of mortgage interest rate increase—if you’ve been waiting—Wait No More.  Enough said.

 

SEVEN EFFICIENT TIPS FOR DOWNSIZERS

RisMedia, 4.25.15

Retirement goals have changed for many since the recession, with one major asset hanging in the balance—housing.

Though many Baby Boomers intend to “age in place” in their current homes, more than half will downsize either by buying a smaller home or one of equal size but with reduced expenses, according to the Demand Institute’s recent Housing & Community Survey.

There is growing debt in households where the head of the family is over 55 according to the Employee Benefit Research Institute.  Much of that debt is tied to mortgages, so downsizing may not only be preferable but could possibly be a necessity for some.

If you or a parent are looking to downsize in the foreseeable future, here are seven ways to pare down possessions.  Cutting down clutter not only helps in the downsizing, but helps make the current home more presentable to potential buyers.

1. Plan backwards from moving day.  Start downsizing three months prior to a planned move.  It is much easier to tackle one room at a time, especially for homeowners who have stayed put for many years. 

 

2. Stick to the OHIO rule.  “Only handle it once”.  It is best to avoid “maybe” plies, particularly when helping a parent who may have a hard time letting go.  Ask yourself or your parent if they would replace the item if it disappeared—this will help make the process feel less like a trashing of beloved possessions.

 

3. Remember more isn’t always better.  We all have duplicate items around “just in case” the original breaks but is it really necessary to have multiple sets of mixing bowls?  Don’t be afraid of purging duplicates.  The same holds true for clothes—don’t hold on to ones that don’t fit, but “may” fit one day. 

 

4. Scale back collections.  Cutting back on a collection can be upsetting for anyone, downsizing or not.  Because it took years to grow it, approach the process as gently, and practically, as possible.  Decide which items are favored more than others or limit the amount based on available space.  A bookshelf can only hold so many books, for example.

 

5. Get cash for your castoffs.  Following the previous three-month rule, if you’re planning to sell an item, start early.  Some things may not sell as quickly as you’d like and you don’t want to be burdened with things you no longer want come moving day.  Sites like eBay charge a selling fee, and some items sell better than others on Craigslist.  Doing a little research will result in the best place for you to sell.

 

6. Contact an auction house.  If you or your parent have an assortment of valuable items, like antique furniture or artwork, you might consider enlisting an auction house rather than an antique dealer.  Dealers want the most bang for their buck—not yours.  It is best to compile a list so that the items can be appraised in one visit.  An Estate Sales Group can help facilitate the sale or auction of high-end belongings, too.

 

7. Donate as much as you can.  When donating items to charitable organizations, parting with possessions is much more manageable.  Parents especially may feel less overwhelmed if they understand that their items are going to those in need.  In many areas, the Salvation Army or Goodwill can transport large items such as furniture or appliances.  Other household items or clothing can be donated to either of them or to a local charity of your or your parent’s choice.

 

HARRY’S JOKE OF THE DAY 

 

 

                                                            

April 20, 2015

 

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.

                                         

THE AMERICAN DREAM CAN BECOME A REALITY, EVEN WITH FINANCIAL SETBACKS OR LIMITED INCOME

The Wall Street Journal, 4.15

While Colorado Springs fared better than a lot of the country, a number of folks still found themselves forced into foreclosure or a short sale during the recession because of negative home equity or loss of income.  With the economy still in recovery, many people are finding that they can again qualify for a mortgage loan. 

Foreclosures and most negative credit events can stay on your credit report for as long as seven years.  Since the majority of the homes were lost to foreclosure between October 2007 and October 2008, many of those events will not show up on current credit reports.  As long as those affected have worked to keep their credit in good standing, borrowing for a home should become easier from here on. 

According to Mark Zandi, chief economist at Moody’s Analytics, “The dark shadow of the foreclosure crisis is finally beginning to fade.  That should be a positive for single-family housing and, by extension, for the broader economy.”

Some previously foreclosed homeowners have also been able to obtain new mortgages without waiting seven years.  The FHA allows borrowers who went through a full foreclosure and have repaired their credit to become eligible for an FHA-insured home loan just three years after a foreclosure is completed and even in as little as one year in rare circumstances.

Fannie Mae and Freddie Mac—which typically guarantee loans that have higher credit quality and lower costs for borrowers than those backed by the FHA—will back loans as little as two years after a short sale under certain circumstances such as a job loss.

The Wall Street Journal recently featured a column about a 30-year-old who is working to become a first-time homeowner.  Even thought he had a full-time position running the technology department of a Catholic high school and teaching classes there, he decided to get a second job at Starbucks in order to save faster for his family’s dream of homeownership.  While this is not an easy situation at present, he’s focused on knowing that eventually owning a home will be a vehicle to provide long-term equity.  It will also likely provide him with deductions that rent paying does not. 

I’ve told you about the new regulations now in effect for first-time homebuyers that require as little as 3% down and the allowance of down payments to come from family members.  These are other vehicles available to those who are finding the ability to move out of their parents’ homes for the first time.  With rents continuing an upward climb and vacancies down, it’s probably a good time to consider all the options available.

It appears that the Federal Reserve is not sold on raising rates in June, which is a plus for those who have not yet taken advantage of the historically low mortgage interest rates.  The raise WILL happen, but probably not quite as soon as we expected, more than likely in September according to predictions from Fannie Mae’s chief economist, Doug Duncan.     

Now is the time to act.  If you or any family member, co-worker or friend has shied away from homeownership due to a previous short sale or foreclosure, looking for a first-time buy, or simply looking for the “right” home to trade up or invest in, please call me at 598.3200 or email me at Harry@HarrySalzman.com and let’s get together to see what we can do to help you realize your residential real estate dreams. 

 

NEW REGULATIONS FOR WATER HEATERS 

American Home Shield 4.15.15

New federal energy efficiency standards went into effect on 4.16.15 for the replacement and manufacturing of water heaters.  I attended a session explaining these regulations and feel it important to share them with you.

Key points of the new standards are:

• Gas, oil fired, electric, tabletop (low boy) and instant (tank-less) water heaters are included
• Existing functioning units do not require replacement
• Existing inventory can be sold and installed
• 55-gallon and larger gas units will implement condensing technology—impacting cost of unit, installation & new venting requirements.  This may require added electrical supply.  There is a required efficiency gain of about 30 percent.
• 55-gallon and larger electric units will implement heat pump technology—which will also impact costs.  Efficiency gains of 40 percent plus are required.
• “Standard” 40-50 gallon units will see moderate price increases.  Technology will remain the same in many instances.  Energy efficiency will largely be achieved through increased insulation.
• All water heaters are expected to be larger (1” x 3” for most, more for some).
• Structural modifications may be required for units located in small, tight spaces—crawl spaces, closets, under stairs, etc.

What does this mean to you? 

To begin, with, water heaters are one of the “big 3” when it comes to replacement so this could eventually result in higher costs for homeowners who have not “upgraded” any existing home warranties to provide for this possibility. Today’s 40-gallon water heater costs approximately $1500-$1600.  We have been told that to replace it, a new 40-gallon water heater could cost upwards of $4000.

It will also mean that when selling your home, or buying a new one, home inspectors will be looking at the water heater to specifically determine if it’s up to standards.

For those with a current home warranty, I would recommend you check with your warranty company to see if and how these new regulations affect you and your home.  Better to “be safe than sorry”.

If you are planning to Buy or Sell, I would suggest that you offer or ask for the “upgraded” level of Home Warranty coverage to help cover any unexpected events.  The additional cost, probably less than $50 for the higher coverage, will be a PLUS in both Buying and Selling a home.

 

BUYING V. RENTING?  A SMART DECISION IN MOST CASES

Realtor Mag, 4.13.15

Homeownership tends to be a smarter decision than renting for many Americans according to new research by Realty Trac.  This is particularly true when rental costs are skyrocketing and in many cases are higher than what a mortgage payment might be.

While homeownership is not for everyone, it makes good sense for many.

Lawrence Yun, NAR’s chief economist, says that families with homeownership tend to have a much higher net worth overall than renters.  Homeowners have the benefit from equity and long-term price appreciation.

NAR’s Economists’ Outlook Blog used the chart below to respond to Buyers’ concerns over “I can’t afford to Buy”.

                          

Over 30 years, a homeowner with a 30-year mortgage payment has a paid-off home while a renter has a stack of 360 rental receipts, analysts noted on the Blog.  The Blog also notes that the lifestyle and social benefits to homeownership show better education achievement by children and an increase in community involvement by homeowners. 

Think you or someone you know can’t afford to own a home?  Maybe you should think again, or at least check it out.  Give me a call and let me run the numbers to see if there is a way to turn a renter into a homeowner and help increase their net worth at the same time.

 

5 HOUSING TRENDS TO WATCH NOW

Ris Media, 4.18.15

While Spring tends to be the “perfect time” for Buying and Selling, don’t expect this year to be perfect--especially if you are a Buyer. 

Limited inventory of homes for sale is starting to increase competition among Buyers—with multiple offers on homes—even those in the high sales brackets. 

On the bright side, though, credit standards are looser than a year ago so you might find it a bit easier to obtain a mortgage.

Trending now:

1. Still Not Enough Homes.   Get ready to compete with other Buyers due to low inventories, which will likely continue.  The situation might worsen when interest rates finally go up, as homeowners may want to hold on to their lower interest rate mortgages. 

 

2. Possible Uptick in Mortgage Rates.  Probably not going to happen just yet, but Buyers and Sellers need to be prepared for this possibility by early Fall.

 

3. A Rise In Home Sales.  Home sales of previously owned homes are expected to rise about 8 percent this year, according to Jonathan Smoke, chief economist at realtor.com.  Home prices should also continue to increase, forecasted to go up 5 percent, Smoke added.  New homes should also rise, with the Mortgage Bankers Association (MBA) expecting a jump of 13 percent in sales in 2015.

 

4. An Increase In Credit Availability.  Credit availability is expected to continue to increase through the Spring, says Mike Fratantoni, chief economist for the MBA.  “I expect that credit availability will continue to slowly improve over the next couple of years….and another beneficial change is that FHA reduced mortgage insurance premiums in time for the Spring season,” he added. 

 

5. A Rise In High End Homes.  If you are looking for a vacation home or looking for a high end home, the market has heated up fast.  Sales of homes in the $750,000 to $1 million range grew 12.6 percent in February, compared with the previous February, according to NAR.  Baby Boomers and international Buyers are driving this surge, but the trend is also attributed to the threat of higher interest rates later this year.  Some lenders are saying that they tend to get a pickup in business when rates go up a bit because folks are worried they are about to lose the opportunity that’s been prevalent for while.

My advice?  There are still homes available in most price ranges and neighborhoods, although less than there were.  If you are in the market, don’t wait too long.  The above trends are proving realistic and things are sure to tighten up once the rates start rising.

 

MORE SPRING BUYING STRATEGIES

Realtor mag. 3.24.15

Just a few suggestions that will help in the Spring Buying Frenzy:

1. Step Away From The Computer.  Approximately 90% of home Buyers start their search on the computer, but Buyers should also consider going outside and canvassing their desired neighborhoods.  In today’s situation of low inventory, if you waste too much time the home you want may no longer be on the market.  You will need to be in a position to make a decision quickly.

 

2. Get To Know The Current housing market.  Every market and neighborhood is different so it’s important to do research on the area where you are thinking of buying.  Knowing market values is important so you will know when the right situation presents itself.  The more educated you are, the better you can make an informed decision.

 

3. Grab Those Low Mortgage Rate—Before It’s Too Late.  Mortgage rates are still hovering below 4% but it’s not realistic to assume they will stay that way as I mentioned several times earlier.  These low rates can make a difference in the home price-range you desire, so do not delay as time may not be on your side.

 

4. Create A Dynamic Team.  I cannot over-emphasize making certain you have a competent, knowledgeable real estate Professional by your side.  Before considering any move, it’s important to ensure you have someone working for you who can help you 1) do the necessary research, 2) get you pre-approved for the mortgage lending best for you and 3) who works with a competent home inspector.  With all of this in place, you are ready to make a move the minute you’ve found the “right” property. 

 

5. Be Prepared For Bidding Wars.  As mentioned earlier, this is a distinct possibility.  With a good team on your side, you will be more aware of the pros and cons of getting into a bidding war.  It’s often possible to “win the battle, but lose the war”, so to speak.  Having a competent real estate Professional on your team can make a big difference in these circumstances, especially when common sense oftentimes give way to desire for what you want.  It’s important to consider all options and your Real Estate Professional can be more objective than you might be in this situation.

What can I add?  Again, while it’s not the “Perfect Spring” for Buyers, having someone like me there for you will make all the difference and help alleviate a lot of the stress. 

 

HARRY’S JOKE OF THE DAY  

 

April 6, 2015

 

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.

 

THANK YOU.  I’M HUMBLED BY THE MANY RESPONSES I RECEIVED

I’ve been writing this eNewsletter for around 12 years and often get responses for each issue and I try to respond to each.  That being said, the number of responses and emails I received this past week just blew me away.  I heard from clients and friends, some of whom I haven’t heard from since I sold them a home more than 20 years ago.  It was heartwarming to know that not only did you take the time to write me, but that you also take the time to read the eNewsletter. 

With the move and all that it entailed, I was not able to respond to the hundreds of emails I received so I want to take a minute now to thank you for all your good wishes.  As you might imagine, this was not an easy decision, and knowing that my clients and friends “have my back” and took the time to let me know, made it so much easier. 

I look forward to welcoming you all to my new office and to working with you again in all your Residential real estate needs.  For those of you who missed the article concerning my move last week in The Gazette, you can click here to read it. 

Again, thank you.  And now enough of me, let’s get on with the “news”:

                                                      

SPRING IS HERE…AND THE BALL IS IN YOUR COURT…LITERALLY

Baseball season begins this Thursday and as most of you are aware, Salzman real estate Services has four front row season tickets for all Colorado Springs Sky Sox home games.  These are available on a first-come, first-served basis so simply give me a call at 598.3200 or email me at Harry@HarrySalzman.com and get your requests in early.  Most Friday night games are followed by a fireworks display, so it’s a great family evening, compliments of me.

Big changes came with this season.  After 20 plus years of affiliation with the Colorado Rockies, the Sky Sox are now the AAA team affiliated with the Milwaukee Brewers.  This appears to be a great association and we look forward to another record setting season, especially in terms of game attendance.

Spring is also a time of “Residential real estate Frenzy” and this year seems to be starting early as those who have been waiting for either higher prices for their current homes or lower interest rates are finally waking up from hibernation and realizing that this could be the last chance for a great deal. 

I’ve been telling you about the predictions of higher interest rates and it appears that the Federal Reserve is finally going to be addressing this at their June meeting.  No one can predict the outcome.  However, I can predict that historically low interest rates won’t be around by this time next year or maybe even by the summer’s end. 

If you’ve been waiting for the “right” time, I’d suggest you wait no longer.  With fewer listings, it’s a great time to put your present home on the market.  While you won’t have as many choices as last year at this time, we can still help you find the home of your dreams that will fit your needs, wants and budget. 

An added advantage for first time homebuyers with good credit is the 3% down mortgage loans available through Fannie Mae and Freddie Mac.  Parents can also help out with down payments on most of these special loans so potential borrowers don’t have to show large savings deposits. 

I’ve given you my “pitch” and the “ball is in your court”.  Give me a call and let’s see what we can do to make your dreams a reality.  Time is no longer on your side and I’d like to see you take advantage of interest rates that we are not likely to see again for a long time, if ever. 

 

MARCH LOCAL STATISTICS CONTINUE TO SHOW POSITIVE RESULTS IN HOUSING

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

According to these statistics it does appear that the Spring Buying season began early again this year. The number of sales are up, the prices are up and homes are being listed, but not in the numbers of several years ago.  Some of that is due to foreclosures going steadily down and the recovery of equity that has helped some people keep their homes or borrow against it for home improvements.

March was the eighth straight monthly increase in sales.  With sales from January through March totaling 2,362, this was the best quarter for any year since 2006.  These numbers reflect stronger consumer confidence along with continued historically low interest rates that many Buyers feel will soon go up and don’t want to miss out on.

Here are some highlights from the monthly PPAR report.  Please click here to view the detailed 13-page report.  If you have any questions, please give me a call.

In comparing March 2015 to March 2014 in PPAR:                      

                        Single Family/Patio Homes:

• New Listings are 1623, Up 1.8%
• Number of Sales are 1,009, Up 21.3%
• Average Sales Price is $259,352, Up 9.3%
• Median Sales Price is $225,000, Up 7.1%
• Total Active Listings are 2,538**

                        Condo/Townhomes:

• New Listings are 176, Down 4.3%
• Number of Sales are 151, Up 64.1%
• Average Sales Price is $153,200 , Up 2.4%
• Median Sales Price is $143,000, Up 10.5%
• Total Active Listings are 262**

**The Active numbers are real time only.  Due to the Matrixc conversion it is not possible to determine those figures for March 2014.

 

COLORADO SPRINGS AREA MONTHLY SINGLE FAMILY/PATIO HOME SALES ANALYSIS*

                                                Median Sales Price             Average Sales Price

Black Forest                            $389,950                              $472,645

Briargate                                  $317,500                             $329,913        

Central                                     $163,000                              $184,024

East                                          $180,000                              $194,499

Fountain Valley:                      $189,900                              $200,860

Manitou Springs:                    $277,000                              $291,666

Marksheffel:                             $268,000                              $271,489

Northeast:                                $215,500                              $236,495

Northgate:                                $354,790                              $391,934          

Northwest:                               $335,000                              $362,496

Old Colorado City:                  $205,000                              $204,503

Powers:                                    $219,950                              $225,854

Southwest:                              $269,500                              $396,468

Tri-Lakes:                                $420,000                              $453,879

West:                                        $214,650                              $233,914

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

 

U.S. HOME PRICES CONTINUE TO CLIMB, TIGHT SUPPLY HINDERS SALES

Realtor Mag 3.26.15, The Gazette, 4.1.15

Existing-home sales continued to improve slightly in February but remain constrained by low inventories of homes-for-sale that are pushing price growth to the fastest pace in a year, according to the NAR.

The median U.S. existing-home price for all housing types was $202,600 in February—up 7.5% from a year ago.

“Insufficient supply appears to be hampering prospective buyers in several areas of the country and is hiking prices to near unsustainable levels,” says Lawrence Yun, NAR’s chief economist.  “Stronger price growth is a boon for homeowners looking to build additional equity, but it continues to be an obstacle for current buyers looking to close before (mortgage) rates rise.”

While mortgage rates still hover near historical lows, this is not forever.  “With all indications pointing to a rate increase from the Federal Reserve this year—perhaps as early as this summer—affordability concerns could heighten as home prices and rents both continue to exceed wages,” says Yun. 

An NAR study in March found a widening gap between rent and income growth across the country, which is making it more difficult for renters to become homeowners.

According to David Blitzer, chairman of the index committee for Standard and Poor Dow Jones Indices, “Home prices are rising roughly twice as fast as wages, putting pressure on potential homebuyers and heightening the risk that any uptick in interest rates could be a major setback.”

Bottom Line?  Once more I’m going to say it.  If you’ve been waiting...wait no more.  While home prices are higher than they were, interest rates are still low.  You will get more for your present home, probably pay more for your “trade up” home than you might have last year, but hopefully the interest rates will stay low for a bit longer and the increased equity from your present home will help offset the difference.  If you are in the market, give me a call and let’s see how we can turn your dreams into reality when it comes to Residential real estate.

 

FOR HOMEOWNERS, SEVEN TIPS FOR TAX TIME

USA Today, 3.19.15

Homeownership is still one of the best tax “deductions” available to most Americans and with a little knowledge and the right documents to back you up, tax time can quickly move from being a “chore” to being a satisfying benefit thanks to deductions on your annual return.

Here are seven important items for homeowners to note so they can take advantage of the biggest possible return on their home ownership.  As always, I encourage each of you to consult with a tax professional to make certain you get the best advice for your individual situation.

1. PMI Deduction Survives:  In 2014, it was an open question on whether Congress would extend tax provisions including a deduction for personal mortgage insurance, or PMI.  Thankfully for homeowners, legislators passed a package in December to extend a number of tax breaks—including one for PMI.
2. Mortgage Interest:  A report from Congress’ Joint Committee on Taxation estimates about $70 billion in mortgage interest deductions annually among American taxpayers.  Make certain your get your fair share—not just because mortgage interest can be substantial, but this tax break alone opens the door for many taxpayers to itemize other smaller breaks instead of settling for the standard deduction.  Simply use Form 1098 if you have paid more then $600 in mortgage interest in the tax year.
3. Local real estate Taxes:  Many taxpayers overlook the fact that homeowners can deduct local, state and even foreign real estate taxes on their federal returns.  There also may be special property tax benefits for lower-income homeowners based on your state or municipality of residence, so be sure to check into that.
4. Losses By Weather, Fire or Theft:  Form 4684 is designed to specifically help you in the event of casualties and thefts.  While no one is looking for damage or theft, the IRS grants a break to any property or casualty loss that is more than 10% of your gross income and is not reimbursed by insurance.  Documentation is key to prove both value and the circumstances of what was lost.
5. Renovations Cut Taxes at Sale Time:  While most renovations you make on your home are not tax-deductible, you might still want to hold on to receipts and documents—most particularly if you are in a hot real estate market or have an expensive property.  That’s because the IRS allows sellers “only” a tax-free profit of $250,000 on a primary residence—but—if you’re above the threshold, you can reduce the tax burden on those real estate gains by proving your investment in the property via renovations and other work.  In simple terms, if you spent $30,000 fixing up a kitchen, then you can make $280,00 from your primary residence and not pay any taxes on that profit.
6. Selling Costs Count, too:  The commission paid to a real estate Agent, as well as any legal fess and closing costs, is tax deductible.
7. Don’t Forget Moving Expenses:  If you moved more than 50 miles for a new job and started that job less than one year prior to purchasing a home, you might be able to deduct moving expenses.  Refer to IRS publication 521 for more specifics.

 

NEW ROADBLOCKS TO HOMEBUYING DUE IN AUGUST

Inman.com, 4.4.15

On Aug. 1, 2015, a shift is coming to wreak havoc at the closing table for both real estate Agents and clients alike.

On that date, the new TRID (TILA-RESPA Integrated Disclosure) forms replace the HUD-1 Settlement and Good Faith Estimate. The Consumer Financial Protection Bureau’s mission is to rebuild the mortgage banking landscape so that the industry will avoid the type of conditions that led to the Great Recession. The CFPB replaces the Department of Housing and Urban Development for oversight because HUD did not provide specific consumer protection.

While increasing consumer protection is a desirable goal, the unforeseen ripple effects of these changes could seriously disrupt how the closing process is conducted.

The new rules will require a new three-day waiting period when there are any changes in the TRID forms.  It is recommended that an extra 15 days are allowed to close transactions.  In other words, 30-day contracts will now require 45 days and 60-day contracts will require 75 days.

While in most cases these issues are resolved and the transaction closes the next day, there could be instances where multiple properties are involved and the delay on one’s home closing could delay others from closing, too.

Many other things can be affected, such as a moving van ready to move things in or an interest rate lock that could possible expire.  These are just some of the possibilities and just another good reason why I always suggest you hire an experienced, knowledgeable real estate Professional to help you with your sale. 

We do the homework and can help you avoid the aforementioned situations before they can arise.  As regulations get tougher and tougher, this becomes more and more important.  I keep abreast of all new regulations and do my best to make your home Buying and Selling experience as stress-free as possible.

 

HARRY’S JOKE OF THE DAY  (In the spirit of Easter and Passover)

 

 

 

                                                            

March 23, 2015 

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.

                     

A NEW CHAPTER BEGINS FOR SALZMAN real estate SERVICES

As you know, I’ve always tried to share any and all information with you on a timely basis.  Well, today’s top story is about ME.  Local readers may have seen this in The Gazette, but for many I’m sure this will be first-time news.

Salzman real estate Services has been in its present location on Garden of the Gods Road ever since I had the building constructed 37 years ago.  It has NEVER been for sale.  That being said, last September I received an offer for my property that was “too good to refuse” and that began “the beginning of the end” of Salzman real estate Services in it’s current location.  On April 1, demolition will begin and soon we will see a Taco Bueno thriving there.  The chain is opening its first three locations in Colorado and my property is one of the three they chose.  I somehow figured 37 years ago that due to its proximity to I-25, one day someone might want to build a restaurant there, but I didn’t know it would be NOW. 

Let me emphasize that I am NOT leaving the real estate arena.  I will simply be working with all of you from a different location and in a new collaboration that I will tell you about next week.  I’ve had a number of offers and am close to announcing a decision.  You, my friends, will be among the first to know the news.  The exceptional customer service for which I am known will NOT change.  Nor will my dedication to making sure that your personal goals become mine when I’m working with you.  In fact, without having to deal with the day-to-day concerns of owning a building, I’ll have even more time to devote to my clients.  So in some ways, this is a bonus for us all.  I will also continue working on my many community service projects.  Nothing will change except for my physical location and collaboration.

As those of you who have moved from long-time residences know, one can accumulate a lot of “stuff” in 37 years.  These past couple of months I’ve discovered just how much “stuff” that is!  Looking back through old files has been heartwarming as it’s made me realize just how many lives I’ve helped influence when it comes to individual family real estate decisions.  And through those files I’ve revisited the many relationships I’ve been very fortunate to develop along the way.

Change of any kind is a bit difficult but going through that “stuff” helped make me even more aware that it’s not the Salzman real estate “building” that made a difference—it’s the people I’ve met and continued to work with during the last 42 plus years in the local Real Estate business that matter the most.  I look forward to a continuation of those relationships and to developing new ones in the coming years.

You, your family members and friends you’ve referred are what makes it all worth it.  As I say goodbye to 538 Garden of the Gods Road later this week I take with me 37 years of memories in this building and relationships made here that I’m simply moving “with” me. 

If you’re in the neighborhood this week, stop in and say goodbye to 538.  I look forward to you joining me in the next chapter of Salzman real estate Services and to sharing my new location and collaboration with you in the next week. 

 

A RECENT RECOGNITION BY COLORADO SPRINGS MAYOR STEVE BACH

Last week, Mayor Steve Bach recognized me for my “leadership and for improving the economic vitality of Colorado Springs.”

Me and my six partners in this venture, gifted property appraised at $422,000 to The Foundation for Colorado Springs’ Future, Inc. which is owned by the Economic Development Committee, and is now part of the Regional Business Alliance of Colorado Springs.

“Our city is fostering an environment for quality jobs growth and we thank Harry Salzman and his partners for their generous gift that will continue to support the attraction of new development and young professionals to our city,” said Mayor Bach.

I am pleased to do anything that I can to help our wonderful city retain and attract more jobs.  This is just our way of giving back to a community that has given so much to us.  I am hopeful that this gift will encourage others to do the same.  Together—we CAN make a difference.

 

CITY OF COLORADO SPRINGS RANKS HIGH IN AFFORDABILITY

The Gazette, 3.14.15

In the Forbes 2015 survey of the most affordable cities, Colorado Springs came in at 11^th.  It was the ONLY metro area in the West to make the list. 

We were chosen when Forbes looked at the 100 biggest metro areas with populations of at least 600,000.  Then they looked at housing affordability, using an index assembled by the National Association of Home Builders and Wells Fargo & Company. 

Then they added cost-of-living components like food, utilities, gasoline, transportation and medical expenses and weighted its various factors using a methodology similar to what the U.S. Bureau of Labor Statistics employs for the Consumer Price Index.

The result was a list of 21 cities (1 was a tie) and most of the cities were in the Midwest and South. 

This survey only re-enforces what those of us who live here already know—we’ve got a good thing going.  Hopefully surveys like these will help bring Colorado Springs to the attention of more employers and companies looking to relocate.  It’s certainly a good factor for young professionals who are looking to start families and want a healthy, affordable community in which to reside.

 

LOCAL JOB STATISICS IMPROVE

The Gazette, 3.18.15

Nearly 4,900 jobs were added in the Colorado Springs area in 2014, according to data released by the U.S. Bureau of Labor Statistics last week.  This is a 1.9% increase from 2013.

According to my friend Tom Binnings, senior partner in Summit Economics LLC, a local economic research and consulting firm, “This is good news because it shows that the local economy has generated about 5,000 new payroll jobs in each of the past two years.” 

There is some local concern that budget cuts are reducing local military employment but fortunately the private sector job growth is improving to make up the difference.  

 

FREDDIE MAC BEGINS 3% DOWN PAYMENTS THIS WEEK

RelatorMag, 3.18.15, Freddiemac.com, 3.18.15

We’ve been reporting about the new down payment requirements from Fannie Mae and Freddie Mac and Freddie Mac has announced that they will be launching the new program this week—at the start of the Spring buying season.  Fannie Mae began insuring 3 % down payment mortgages in December.

According to Dave Lowman, executive vice president for Freddie Mac, “Lenders will be ready to serve qualified working families who are ready to buy and keep the recovery going”. 

The Federal Housing Finance Agency, conservator of Fannie Mae and Freddie Mac, said recently that it wanted to make it a priority to “work to increase access to mortgage credit for credit-worthy borrowers.”  This is in response to tight credit conditions and high down payment requirements in recent years that have been blamed for sidelining potential homebuyers and slowing down the housing recovery.

In addition to the lower down payment requirements, “Freddie Mac’s Home Possible Advantage Program”, which is aimed at supporting first-time buyers as well as low and moderate-income borrowers, is allowing no minimum from borrowers in contributions.  This means parents or relatives can now cover 100% of the down payment through gifts.  The same is true for all Freddie Mac Home Possible mortgages, whether the down payment is three percent, five percent or something else.  This makes Home Possible a powerful option for families who want to help their children settle into a home of their own.

In order to limit default risk, Home Possible Advantage is available as a fixed-rate mortgage for primary residences only; this insures that principal and interest payments stay the same and borrowers won’t worry about the future mortgage payment shock. 

If you have any questions about these programs, or wish to help family members purchase first-time homes, please give me a call at 598.3200 or email me at Harry@HarrySalzman.com and let’s see if we can make that happen.

 

THE IMPORTANCE OF GETTING THE ‘RIGHT’ MORTGAGE

The Wall Street Journal, 3.14.15

With Spring Buying season already underway, many Buyers are rushing to get pre-approved for mortgages prior to the Federal Reserve raising rates, which could happen in the next few months. 

Lenders are doing their part by accepting smaller down payments and offering lower interest rates on certain loans.  However, mortgage loans aren’t “one-size-fits-all” and the best deals and strategies often vary significantly depending on whether you are taking out a “jumbo” mortgage or looking for a modest first home.

Borrowers with less than stellar credit or who are trading up to a larger home can also have different options or challenges.  It is very important to make certain that you find a mortgage tailored to your individual situation and budget requirements. 

As I’ve said before, making certain that you work with a qualified, knowledgeable real estate professional is probably the most important home decision you can make.  We have the experience to make certain that you are steered in the right direction when it comes to mortgage lending. 

With my Investment Banking background, I’m acutely aware of what’s available in the mortgage lending arena, have reputable mortgage lending sources, and will help you avoid a mistake that could cost you not only a lot of money, but also a lot of stress and aggravation. 

No one knows when the rates will be going up, but according to recent articles concerning the Fed, changes WILL be coming.  If you have been waiting, wait no longer.  These historical interest rates will soon be a thing of the past. Spring buying” frenzy” will probably be a bit crazier than usual with folks who see this as a “last chance” for great rates.  So if you’re in the market, give me a call sooner than later to make certain that you can not only find the home you want, but also get the rate you want, too.

 

HARRY’S JOKE OF THE DAY  (found when I was going through files in the office!)

 

 

 

 

 

                                                            

March 9, 2015

 

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.

                                        

2015 CONTINUES TO DELIVER GOOD NEWS TO HOMEOWNERS

And so it goes…the good news in the real estate market just keeps coming.  Despite the worst weather in the Pikes Peak region since 1987, the housing market shows no sign of slowing down.  This is great for both Buyers and Sellers and it will likely continue this trend, at least until the Fed finally readjusts its plans and interest rates start inching up.  And then, my friends, all that I’ve been warning you about will come to pass. 

We’ve enjoyed historically low interest rates for several years now and that’s going to end before 2015 comes to a close.  No one knows exactly when the rates will go up, but all the economists have agreed that it’s going to happen based on the improved economy and job market.

What can I add?  Once more, if you’ve been on the fence, it’s starting to look like “do or die” time.  Housing prices are going up, inventories are getting lower and interest rates will be on their way up soon.  If you’ve waited for the “right” time—well, I wouldn’t wait much longer. 

Those looking to Sell and Trade Up, Buy for Investment Purposes, or first-time Buyers might want to give me a call in the near future to see how we can make those wishes come true.  There’s a “right” situation out there for everyone, but first you need to sit down and assess what’s “right” for your individual needs, wants and budget. 

Give me a call at 598.3200 or email me at Harry@HarrySalzman.com and let’s work together to see what we can do for you.

 

FEBRUARY LOCAL STATISTICS CONTINUE TO SHINE

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

As elsewhere around the country, these local numbers indicate that the combination of homes priced to sell and historically low mortgage rates are continuing to help fuel the housing market.  The number of home listings in both categories remain low as many renters are finding a way to become homeowners, some for the first time.

Here are some highlights from the monthly PPAR report.  Please click here to view the detailed 10-page report.  If you have any questions, please give me a call.

In comparing February 2015 to February 2014 in PPAR:

            Be Sure To Take A Second Look—These Number Are A Real “WOW”                       

                        Single Family/Patio Homes:

• New Listings are 1,127, Up 5.8%
• Number of Sales are 717, Up 25.1%
• Average Sales Price is $248,279, Up 8.2%
• Median Sales Price is $225,000, Up 14.8%
• Total Active Listings are 2,429

                        Condo/Townhomes:

• New Listings are 143, Up 13.5%
• Number of Sales are 100, Up 51.5%
• Average Sales Price is $144,165, Down 14.3%
• Median Sales Price is $138,000, Even
• Total Active Listings are 272

 

COLORADO SPRINGS AREA MONTHLY SINGLE FAMILY/PATIO HOME SALES ANALYSIS*

                                                Median Sales Price             Average Sales Price

Black Forest                            $377,838                              $430,153

Briargate                                  $279,000                              $293,508        

Central                                      $154,500                              $166,361

East                                          $172,500                              $182,699

Fountain Valley:                      $197,950                              $198,226

Manitou Springs:                    $290,000                              $290,000

Marksheffel:                             $236,000                              $250,303

Northeast:                                $211,500                              $226,488

Northgate:                                $365,000                              $361,681

Northwest:                               $310,500                              $317,777

Old Colorado City:                  $205,000                              $221,336

Powers:                                    $220,000                              $233,151

Southwest:                              $250,225                              $305,272

Tri-Lakes:                                $427,000                              $429,850

West:                                        $201,500                              $260,403

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

 

REALTORS CONFIDENCE INDEX INDICATES SPRING MARKET OPTIMISM

Realtor.org 3.2.15

I thought you might be interested to see the January results of Realtors Confidence Index, a monthly survey that is sent to more than 50,000 real estate professionals.  The survey asks about their expectations for home sales, prices and market conditions and is a key indicator of housing market strength.

Highlights from the January Survey:

• Realtors reported more Buyer activity in their markets on the heels of lower mortgage rates but not enough inventory to match demand.
• Local markets broadly picked up across all property types in January 2015 compared to December 2014, although activity was more modest compared to a year ago.
• Problems facing potential home Buyers included modest income growth, weak credit and income profiles, and in the case of condominium Buyers, projects not meeting eligibility guidelines for borrowers to obtain FHA/VA or conventional financing.
• Realtors in states adversely affected by the harsh winter (e.g. MA, PA, and IL) reported market slowdowns.   (an aside here—Colorado Springs, which certainly was affected by the weather, did NOT have those slowdowns!)
• Looking ahead at the Spring market and the increased buying interest, Realtors were broadly more optimistic about the outlook for the next six months.

 

2015: A YEAR OF HOUSING OPPORTUNITY FOR MANY

keeping current matters, 2.24.15

                            

When the housing market crashed, many believed that so too would the desire of American’s to again own a home.  Contrary to that, many recent reports are showing that, especially among younger generations, the American Dream of homeownership is still very much alive.

In a recent speech at the National Press Club, Julián Castro, Secretary for HUD, summed up what it means to own a home:

“Homeownership is still the cornerstone of the American Dream—a fact you can see in the lives of everyday folks.

It’s a source of pride.  It’s a source of wealth, both providing a nest and a nest egg.  And it strengthens communities and fuels growth in the overall economy.”

Castro appropriately entitled his speech, 2015: A Year of Housing Opportunity”, a theme that rang true throughout:

“Opportunity is not an abstract concept—it’s a path to a more prosperous life, and housing often serves as its foundation.  T. S. Elliot once said that ‘Home is where one starts from.’

A home is often a primary source of wealth in a family…Having a home is a generational way to pass that wealth on.  We want people responsible enough to own a home to have that opportunity.”

Bottom line of his speech:

“Over the years-through decades of economic downturns and wars—the American people have always held on to this Dream, and always will.”

With the improving economy, more and more Americans will qualify for homeownership, thus allowing more families to obtain the American Dream.

 

TOP 10 real estate TIPS FOR 2015

Bankrate.com,, The Gazette 1.25.15

With the single-family home sector predicted to outperform the strong one in 2014, it’s important to let proven facts lead the way.  Here are a few tips that can help in the real estate process.

1. SELLERS--DO SWEAT THE SMALL (CHEAP) STUFF

Little touches go a long way in the Buyer’s eye.  Make sure your entry way has trimmed bushes, clean walkways, and new welcome mats.  Inside, de-cluttering makes a big difference for first impressions.  Focus on uncluttered closets, rooms and most especially kitchen counters.  Remove family mementos, prescriptions from the medicine cabinets and hide piles of toys.  The idea is to allow the Buyer to picture the home as “his”, not yours.

2. BUYERS—TAKE NOTE(S)

When looking at a number of properties, it’s often possible to forget the pros and cons of each.  Keeping a list of those for each home visited and later creating a rating scale of 1-10 to help you determine what you liked about these homes will come in handy.   It also helps to carry of checklist of the specific home features you want to compare with each home visited.

3. SELL BY SEASON

Winter:  Spotlight functional fireplaces.  Near the holidays, add touches like wreaths or pine cone centerpieces.  Also, displaying pictures of the home in other seasons allows the potential Buyer to picture the house with greenery, rather than snow!

Spring:  Fresh-cut flowers bring the weather indoors.  Do extra Spring-cleaning and use pops of color in the entryway and landscape.

Summer:  Highlight patios and outdoor areas.  Swap out dark curtains and towels for lighter colors.  Keep the house cool, but not cold.

Fall:  Display vases of fall foliage or tri-colored corn.  Put pumpkins in the entry. And most importantly, keep leaves at bay.

4. DRILL DEEPLY

It’s a good idea to look at the entire neighborhood at various times of the day.  Here are some signs to determine if the potential new neighborhood is fading or flourishing:

Bad Signs:  A major local employer is moving away or struggling, adjacent neighborhoods are progressively turning into rentals, nearby commercial spaces remain persistently vacant and a few too many for-sale homes are lingering on the market.

Good Signs:  Schools are well-rated and in high demand.  Young and artsy types are moving in.  Older couples are “aging in place” and nearby commercial properties are getting redeveloped and quickly leased.  For-sale homes are quickly generating multiple offers.

5. ‘BIG DATA’ IS EVERYWHERE, SO TAP IN

Banks use “Big Data” to gauge the worth of foreclosures and short sales, and mobile apps now offer it for consumers and real estate agent use.  “Livability” ratings, which rank and contrast neighborhoods by air quality, traffic choke points and specific data on a home’s energy efficiency are oftentimes available if you ask.

6. TRANSPARENCY EQUALS TRUST

Since Buyers will certainly enlist inspectors to check over your home, why not go transparent with your own presale inspection?  That way you will know in advance what issues (plumbing, roof, HVAC, etc) might come up and lead to disappointment and delay the sale of your home.  You can provide the Buyer with a copy of the inspection, along with receipts for any repairs that you have already done and explain how or if you’ve adjusted your asking price accordingly.

7. MATH VS. EGO

Buyers need to be careful not to get into a win-at-all-costs type of negotiation and will stubbornly let a few thousand dollars keep them from getting the “right” house.  At an interest rate of 4.5 percent, the difference of paying $200,000 and $195,000—assuming 1.25 percent property tax and 15 percent down—is only about $25 per month on a 30-year mortgage.

8. RETAIN MINERAL RIGHTS

With so many giant natural-gas fields (shales) in play across the U.S. and new ones pending, homeowners should exercise “Seller’s market” clout to retain mineral rights.  While this intent need not be mentioned in the sales contract in many states, it’s always safest to note it, provided the Buyer doesn’t protest.  You can avoid that scenario by conveying those rights to a trustworthy relative or to an energy company buying them BEFORE listing the house.

9. BUYING?  THEN COOL IT FOR AWHILE

Lenders consider your debt-to-income ratio when determining the mortgage amount you can afford.  It’s best to avoid making new purchases like a car or opening new credit cards and the like prior to purchasing a new home.  Acquiring new debt, moving large sums of money around, changing banks or becoming self-employed immediately before buying a new home can adversely affect the financing outcome.

10. THE PRICE IS RIGHT

It is of utmost importance to price your home realistically from the beginning.  Accurate pricing sells homes. Don’t play pricing games.  Activity in the first month of a listing is always the best, so don’t risk wasting it.  Pricing too high will scare off brokers and Buyers and pricing too low will risk leaving dollars on the table.  Hiring a knowledgeable broker with a good track record will provide you with the data support that will yield the pricing that is “right on” for your home.

 

HARRY’S JOKE OF THE DAY

(Not as funny as you might think—good examples of why you need a competent, experienced real estate Professional)

  

 

 

 

 

 

 

 

 

 

 

                                                            

February 23, 2015

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.

                              

LOTS OF POSITIVE NEWS ON THE HOME FRONT ONCE AGAIN

It’s always a pleasure to share good news and as a local Realtor, it’s even more pleasurable to be able to provide positive statistics concerning real estate in the Pikes Peak area. 

I recently received the Final Quarter 2014 Statistics from both UCCS College of Business and the National Association of Realtors (NAR) and am delighted to share them here with you. 

Despite the once-in-several-decades blizzard we are experiencing as this is being written, I can’t help but rejoice in knowing that you, my readers and clients, continue to have the possibly once-in-a-lifetime opportunity to participate in today’s housing and interest rate market.

As with all good news, there is a flip side.  In the case of the housing market, coming out of the recession means that the Fed will soon change direction and when that happens, interest rates are going to rise.  I’ve documented that in the last several eNewsletters, so suffice it to say—you’ve been forewarned. 

Anyone sitting on the fence about making a move, either from across town or across the country—NOW is the time.  There are fewer choices available, but I feel confident that I can help you find the right home for almost any of your wants, needs and budget.  Even if it’s just a subtle dream, give me a call at 598.3200 or email me at Harry@HarrySalzman.com and let’s see if we can make that happen for you.  There’s never been a better time and remember—time is beginning to run out!

 

SOUTHERN COLORADO ECONOMIC FORUM’S QUARTERLY UPDATES & ESTIMATES

College of Business and Administration, UCCS, Southern Colorado Economic Forum, February 2015

The latest update on the El Paso County Economy, including housing trends, was published last week and you can click here to read the 10-page report in full.  Here are some of the highlights I thought you would find interesting:

• The trend in home sales continues to improve, with a 3.8% increase year-over-year.

 

• The December 2014 year-to-date number of sales was 11,197.  That’s 411 more than a year ago.

 

• Active listings are 19.4% lower than a year ago, but the average sales price of a home sold is 7.3% higher than last year same period. The report notes that local home Buyers are equally, if not more, interested in buying existing homes than in building new ones.  The recent announcements regarding new company locations here will also likely impact housing.

 

• Foreclosures were approximately the same number as in 2013.

 

• Vacancies for multi-family housing dropped to 5.45% from 5.88% by year end, which is a positive indicator. Rental rates are continuing to rise.  The trend toward apartment and multi-family housing is continuing to rise and the growth of the UCCS student body is a factor in this increase.

 

The next several sections of the report include:

• Colorado Springs Airport Trends
• Employment Trends and Wages
• Colorado Springs Sales Taxes
• New Car Registration Trends

It is with pleasure that Salzman real estate Services, LTD is able to share these types of statistics and forecasts with you as soon as they become available, each and every quarter.  We have been a supporter of the Southern Colorado Economic Forum since it was created by the UCCS College of Business in 1996.  I would be happy to answer any questions you might have concerning the detailed reports and how they might affect you personally or any question you might have concerning Real Estate in general.

 

NAR YEAR-END STATISTICS ARE ALSO POSITIVE

Realor.org 2.12.15

The recently published Quarterly Report by the NAR indicates that the majority of the 174 metropolitan areas surveyed experienced a steady, but slightly stronger price growth in the fourth quarter of 2014. The median existing single-family home price increased in 86% of the measured markets. 

Lawrence Yun, NAR chief economist, says that improved sales activity compared to a year ago, along with tightened supply, contributed to faster price appreciation in the final quarter of 2014.  “Home prices in metro areas throughout the country continue to show solid price growth, up 25% over the past three years on average,” he said.  “This is good news for current homeowners but remains a challenge for buyers who are seeing home prices continue to outpace their wages.  Low interest rates helped preserve affordability last quarter, but it’ll take stronger income gains and more housing supply to help meet the pent-up demand for buying.”

The national median existing single-family home price in the fourth quarter was $208,700, up 6.0% from the fourth quarter of 2013. 

The NAR report uses “median” price and the UCCS report uses “average” price, but both scenarios indicate that Colorado Springs is experiencing good housing appreciation.  While the NAR report shows the national median price to have increased 6.0%, our median price increased 3.4%.  This is NOT a bad thing.  We did not experience the downturn in the housing market as horrifically as many parts of the country so we had less home equity to make up.  The good news is that we are slowly but surely increasing our median price of single-family homes and that is fabulous for those who want to sell and trade up or buy for the first time. 

To look at the 3-page report in it’s entirety and see how we compare to the rest of the 174 metro area surveyed, please click here.

 

MORE GOOD NEWS

Dsnews.com, 2.16.15

Predictions for the labor market have been revised upward according to a survey of economists released last week—which most always means good news for the housing market.

The Philadelphia Federal Reserve surveyed 39 economic forecasters and while their predictions regarding GDP and overall economic growth were changed little from a similar survey three months prior, the forecasts for job gains and labor markets were much improved. 

“It’s got to be positive for housing, because all your consumer numbers are going in the same direction,” said the managing director and chief economist with Wells Fargo, who was one of the panelists to participate in the survey.  “With more jobs, higher wages, and income growth, you always see an increase in consumer confidence.”

Coupled with the recent news of new companies relocating to Colorado Springs, this can only bring greater economic growth, and thus greater home appreciation to our local homeowners. 

 

SPRING housing market SURE TO BE ‘HOT’ THIS YEAR

Realtor.mag, 2.18.15

Historically low interest rates and a healthier economy will likely lure more homebuyers to the marketplace this Spring.

According to NAR’s latest housing report, Tight Supplies Put Home Prices On the Move:

“Interest rates below 4 percent, rising rents, and healthier local job markets are convincing more consumers to consider home ownership,” Chris Polychron, NAR President, said in a recent news release showing fourth-quarter 2014 home prices moving up.

Spring is always the “stellar” season for home buying and selling and this year portends to be bigger than usual.  As I mentioned earlier, interest rates are not going to stay down, nor are home prices.  The frenzy we saw last year was nothing compared to what I expect to see this Spring. 

First-time homebuyers with good credit are being afforded down payments as low as 3% through Fannie Mae and Freddie Mac and with rental rates rising, we also expect to see a number of investors rushing to find properties to provide rental income. 

Those who have seen increased home equity are finding that this is a good time to consider that move to a new home or neighborhood.  All in all, the time is right to consider what’s best for your personal housing situation.  As always, I’d be happy to help you sort out all the possibilities, so give me a call BEFORE the season gets under way.

     

TEMPTED TO PUT HOME EQUITY TO WORK?

Wall Street Journal, 2.6.15

Here are a couple of questions for homeowners who are tempted to borrow on their home equity to invest in the stock market.

1. What is my tolerance for risk? 
2. Do I have enough in reserve holdings to cover sudden swings in home values and the market?

According to a recent article in The Wall Street Journal, over the past five years, the total return for the S&P 500, including dividends, averages out to 15.45% a year.  Meanwhile, the average annual interest rates on a home-equity line dropped from 5.41% in 2010 to 5.05% in 2014, according to HSH.com.  Considering that math, a $100,000 home-equity line held for the past five years would have cost a borrower $25,980, but invested in the S&P 500, that money could have more than doubled to $205,102.

It appears to be a great deal, but one needs to consider that it has also been during an unusual bull market, says David Blitzer of the Index Committee at McGraw Hill Financial’s S&P Down Jones Indices unit. 

“The last five years were not a typical five years; 2009 was pretty much the end of the recession, the bottom of the bottom,” he added.  “A rule of thumb (for annual total return) is 6% to 7%, or a double in 10 years.”

Blitzer says that investors need to accept that they could lose money over any given five years in the market, and that money would be borrowed against the equity in their home.  In other words, if home values plummet, a borrower could be out not only the money invested but owe more than the home is worth, he said. 

Most financial advisors suggest that potential borrowers consider all factors, including tax implications for dividends and capital-gains, as well as interest deduction on the interest of home equity loans.

Other factors include having the flexibility to sell an investment sooner or hold onto it longer, depending on stock market conditions.  Homeowners who know they are likely to move or sell the house within five years might not have that type of flexibility. 

“Typically, the stock market goes up and down faster and is more volatile than the housing market, even including the (recent) boom and bust,” Blitzer says.  “If you wait long enough, you are probably going to come out ahead in the stock market, but there are certainly some cases where five years are not long enough.”

A few more tips for those contemplating a home-equity line or loan:

• Fees differ among lenders.  Potential borrowers who shop around may save.  Some lenders charge no fees for their home-equity products while others may charge closing costs, third-party origination fees, mortgage taxes and annual fees, according to Matt Potere, home-equity product executive for Bank of America.

 

• Relationships may matter.  On the other hand, some banks may offer discounts to customers who already have other accounts.  For example, Bank of America Preferred Rewards members may save up to 0.375% on a home-equity-line interest rate.

 

• Don’t forget AMT.  Taxpayers subject to the alternate minimum tax need to keep in mind that they won’t be able to deduct home-equity interest.

Our suggestion?  Since borrowing on home-equity for investment purposes can be a tricky thing, we believe it is ALWAYS prudent to first check with your financial and tax advisors PRIOR to making any decisions.  You want to make certain that borrowing for ANY type of investment, including stocks, bonds or rental property, is something that makes sense for your overall personal financial strategy.

 

HARRY’S JOKE OF THE DAY

  

 

 

 

 

                                                           

February 9, 2015

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.

                                      

JANUARY LOCAL STATISTICS REMAIN VERY POSITIVE

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

January in the Pikes Peak Area proved that the robust housing market appears to be continuing despite cold weather and post-holiday conditions.  Local residents are responding in a similar manner to folks all around the country as they realize better economic conditions than we’ve seen in several years.

The numbers here indicate that the combination of historically low mortgage rates and homes priced to sell are continuing to fuel this growth.  Listings in both categories continue to dwindle as many renters are finding a way to become homeowners, some for the first time, and many with the help of new low down payment requirements.

Here are some highlights from the monthly PPAR report.  Please click here to view the detailed 10-page report.  If you have any questions, please give me a call.

In comparing January 2015 to January 2014 in PPAR:                      

                        Single Family/Patio Homes:

• New Listings are 1082, Down 10.9%
• Number of Sales are 636, Up 6.7%
• Average Sales Price is $261,310, Up 11.4%
• Median Sales Price is $235,250, Up 11.0%
• Total Active Listings are 2,470, Down 23.5%

                        Condo/Townhomes:

• New Listings are 164, Up 16.3%
• Number of Sales are 99, Up 30.3%
• Average Sales Price is $176,602, Up 2.8%
• Median Sales Price is $142,000, Up 6.8%
• Total Active Listings are 297, Down 15.6%

 

COLORADO SPRINGS AREA MONTHLY SINGLE FAMILY/PATIO HOME SALES ANALYSIS*

                                                Median Sales Price             Average Sales Price

Black Forest                            $399,950                              $381,200

Briargate                                  $320,375                             $332,734        

Central                                     $182,500                              $209,461

East                                          $186,400                              $195,890

Fountain Valley:                      $218,169                              $217,889

Manitou Springs:                    $171,000                              $171,000

Marksheffel:                             $246,000                              $252,813

Northeast:                                $213,000                              $218,546

Northgate:                                $368,000                              $409,786

Northwest:                               $279,700                              $309,155

Old Colorado City:                  $225,000                              $262,746

Powers:                                    $235,250                              $237,317

Southwest:                              $234,000                              $336,791

Tri-Lakes:                                $412,000                              $432,866

West:                                        $201,000                              $330,971

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

 

A LOOK BACK TO AUGUST 1974… MUCH LIKE TODAY IN ALL BUT THE NUMBERS

Business Week, 8.10.74

While going through my archives, I came across an article from August 1974—more than 40 years ago.  It was published in the Personal Business section of the old Business Week magazine and I thought you might find it as interesting as I did, both then and now.

The section titled “It Doesn’t Pay to Wait to Buy a House”, talks about how for those who might have been scared out of the housing market due to tight money and high interest rates, then would be the time to take a look at what a new home would cost “today”.  It states:          

“According to the National Association of Home Builders, the cost of the average single family home is $35,800 this year compared with $25,600 in 1969.  And mortgage rates have risen to 9.5% to 10% today against 8% five years ago.”

What can I say?  I’ve always been an advocate of “the time to buy is NOW”, and this article backs me up perfectly.  You can no longer find a home for those kind of prices, but today’s mortgage interest rates are historically low.  Who could have imagined back in 1974 that in 2015 we would see 30-year fixed rates as low as 3.38%? 

Those interested in a little “blast from the past” can view the Business Week article by clicking here.  I know you’ll find it interesting.  Just as interesting as those folks 40 years from now who will look back and not believe that we could actually finance a home for under 4%.

One thing I can tell you for sure...the interest rates aren’t going to stay this low forever.  With the economy improving along with the job market, the Fed is sure to raise the cost of money to hold back inflation and with that--up goes the mortgage interest rates. 

As you can see from the PPAR statistics, the number of available homes is continuing to decline as folks realize the current low rates aren’t a “sure thing” for the future.  While there are fewer listings, there are always homes available to meet most needs, wants and budgets.  If you are still on the fence, I wouldn’t advise waiting a lot longer.  Why not give me a call today and let me run the numbers and see if we can make it the “right time” for you.  I can be reached at 598.3200 or by email at Harry@HarrySalzman.com .

 

HOMEOWNERSHIP IS AT LOWEST RATE IN TWO DECADES

LA Times, 2.15, The Gazette 2.1.15

According to the U.S. Census Report, the national home ownership rate fell last quarter to the lowest level in two decades. 

Despite the housing recovery of recent times, the ownership rate has been on a steady decline since the housing boom of the last decade. This has been attributed to families struggling to purchase a home because of home prices rising faster than incomes in recent years, along with tighter lending standards.

Analysts are hopeful that the housing market will pick up again this year after a slow 2014.  Job growth in 2014 was the strongest since 1999 and mortgage interest rates are still low.  On top of that, the government is taking steps to ease lending standards, with new programs from both Fannie Mae and Freddie Mac intending to back loans with down payments as low as 3 percent.

So, once again, if you or anyone you know has been left out of home ownership in recent times, now could be the perfect time for getting back in the market or purchasing a home for the first time.  Just give me a call and let’s find out if we’ve got the answer to your home ownership dreams.

 

A FEW HEADLINES FROM REALTORMag THIS WEEK…

• Mortgage Rates Fall Again.  Average rates fell again for the week ending February 5:

--30-year fixed rate mortgages averaged 3.59 percent

--15-year fixed-rate mortgages averaged 2.92 percent

--5-year hybrid adjustable-rate mortgages averaged 2.82 percent

--1-year ARMs averaged 2.39 percent

 

• Why Homebuyers Need to Act Now.  Homebuyers need to move fast if they want to spend less, according to Jonathan Smoke, chief economist at realtor.com.  “Delayed purchases will only result in higher monthly payments as prices and rates rise,” Smoke wrote.  Realtor.com is forecasting that affordability may decline as much as 10 percent over the year.

“Right now, the Fed is using the word ‘patient’ to describe its approach to picking the time to raise the target rate,” Smoke notes.  “However, when the Fed ‘loses patience’, rates will go up at least 20 to 40 basis points in anticipation of the target rate officially going up…so, Buyers beware:  The clock on these low mortgage rates may be ticking.”

 

• Millennials Move Toward Home Ownership.  Young couples and singles in their late 20’s and early 30’s are making a belated entry into the home-buying market according to several recent housing reports.  Rising rates, moderating home prices and new, lower down payment requirements are providing good reasons for these individuals to now enter the market. 

Jonathan Smoke has called 2015 the “year of the millennial” in real estate.  He says that home Sellers should be encouraged by this, particularly those who own affordable home and are looking for a long-over-due upgrade.  With the move by many lenders to permit smaller down payments on home purchases, more millennials will likely make a move and that means home Sellers “who’ve been sitting on equity in entry-level homes can finally upgrade to bigger homes and retirement homes.”

 

HARRY’S JOKE OF THE DAY    (HAPPY VALENTINES DAY)

                 

 

                    

 

 

 

 

 

                                                           

January 26, 2015

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.

                                      

     

THE AMERICAN DREAM OF HOME OWNERSHIP IS ALIVE AND WELL

The housing news, both on a national and local front, has been very positive and from the looks of it, more and more folks will be able to afford the home of their dreams.  Many will see greater appreciation in their current homes and first-time buyers are being afforded a number of options to make it easier to switch from renting.

All sources I’ve seen are predicting a strong housing market for 2015.  From NAR Chief Economist, Lawrence Yun...to Freddie Mac…to our local Southern California Economic Forum’s Director, Tatiana Bailey...the news that’s coming my way has all been positive. 

This is not “wishful thinking” from an eternally positive Broker/Owner—namely me.  This is reality—with all the respected industry economists agreeing.  There’s no better time than now to get off that fence and make your personal dreams a reality. 

With interest rates remaining at historic lows and current home appreciation on the rise, it’s time to put the equity you’ve built to work for you.  There are too many options to go into here, but why not give me a call at 598.3200 or email me at Harry@HarrySalzman.com and let me help you figure out what is the best plan for your particular wants, needs and budget. 

 

A LOOK AT SOME OF THE HOUSING EXPECTATIONS FOR 2015, LOCAL AND NATIONAL

From UCCS, College of Business and the Southern Colorado Economic Forum:

I’d like to share with you a presentation by Tatiana Bailey, Ph.D., Director of the Southern Colorado Economic Forum.  She spoke to the Pikes Peak Area Realtors (PPAR) on January 9, 2015 and I asked her permission to share the slide overview with you.  

The presentation includes information on both the national level, some of which I’ve shared with you previously, and a look at the local Pikes Peak area real estate market. 

Please click here for a look at some exciting statistics and projections.  If you have any questions, please give me a call.

 

From the National Association of Realtors:

The infographic below is from a video of NAR’s Lawrence Yun talking about his 2015 housing market expectations.  He expects existing-home sales to rise about 7 percent in 2015 behind a strengthening economy, solid job gains and a healthy increase in home prices.

 

                       

 

From Freddie Mac’s “2015 U.S. Economic and housing market Outlook for January”:

Realtor Mag, 1.21.15,  DS News, 1.21.15

Freddie Mac economists note that mortgage rates continue to remain below expectations, and they predict that mortgage rates will remain low at the beginning of 2015, staying around 4 percent for at least the first two quarters of the year.  Last week, mortgage rates dipped to a 20-month low, with the 30-year fixed-rate mortgage rate plunging to a 3.66 percent national average and the 15-year fixed-rate mortgage dropping to 2.98 percent.

“We…expect these low mortgage rates to help the growing purchase market continue to expand and reach the highest levels we’ve seen since 2006,” the economists noted.

But, as mentioned earlier, NAR’s Lawrence Yun predicts that mortgage interest rates could average around 5 percent—or higher—by the end of this year.

Buyers who have been sidelined due to high monthly rents preventing them from saving for a down payment on a home should be in a better position with new programs aimed to assist them in becoming homeowners.

Freddie Mac, along with Fannie Mae, believe its new announcement of offering mortgages with down payments as little as 3 percent, along with the FHA’s recent announcement that it will cut its premiums for new and refinancing borrowers by a half percentage point will help increase mortgage availability to first-time home buyers.

Economists also note in this report that home prices will likely rise by 3.5 percent this year.  Increased wages in the labor market will give consumers greater confidence.  The National Federation’s Independent Business Index for December showed that small businesses expect to raise employee compensation to the highest level since 2006.

In concluding, Frank Nothaft, Freddie Mac’s Chief Economist said, “On balance there are a lot of positive opportunities in the U.S. economy at the start of the year, and the real question is whether or not households and businesses will be able to seize these opportunities and make the most of them.  The reprieve in interest rates and drop in gas prices should help to spur economic growth.  Until rates start to rise later in the year, housing markets should respond positively, and we anticipate increases in home sales and continued improvement in construction activity.”

 

Down Payments Get Smaller

The Wall Street Journal, 1.25.15

More lenders are lowering down-payment requirements, allowing borrowers to commit 3 percent—or less—of a home’s purchase price to get a mortgage.  Many had been requiring at least 20 percent since the recession began. 

Some lenders are also waiving mortgage-related fees, and more are allowing down payments to be made by other parties, such as the borrower’s family. 

These deals are aimed at buyers with good credit scores and a steady income who have been unable to save enough for a sizable down payment.   In some cases, to qualify, borrowers will need a higher credit score and less debt relative to their income than is usually required, as well as having savings after the home purchase equal to at least 12 months of mortgage payments. 

Borrowers who want to get a mortgage with a particular lender could ask if they would allow a lower down payment than what is officially offered. 

In looking for loans, borrowers need to compare costs, including the interest rate, whether they have to pay any upfront fees to get that rate and what their total costs to get the loan will be.  A lower interest rate might not be such a good deal if it requires a larger out-of-pocket upfront expense.

So… what does all this mean to you?  To begin with, NOW is a great time to sell and trade up or buy for the first-time or investment purposes.  However, with all the options available in mortgage lending and in deciding what is best for your particular situation—it’s more important than ever to seek the advice of a reputable, knowledgeable real estate Professional. 

That’s where I come in.  As you can see from this eNewsletter, I do the homework so that you don’t have to.  I can help you determine the best housing situation and best lender for YOU.  As stated in the Freddie Mac report, it’s up to you to seize the possibly once-in-a-lifetime opportunities in the housing market.  In order not to miss out, give me a call and let’s see if we can make this positive market work for you.

 

5 FINANCIAL REASONS TO BUY A HOME

keeping current matters, 1.21.15

Eric Belsky, the Managing Director of the Joint Center of Housing Studies at Harvard University presented the top five financial benefits of homeownership in his paper entitled “The Dream Lives On:  the Future of Homeownership in America”.

I’ve mentioned these before, but with the market heading in such a good direction, I felt it important to reemphasize their importance. 

Here are the five reasons, each with an excerpt from the study:

1. Housing is typically the one leveraged investment available.  “Few households are interested in borrowing money to buy stocks and bonds and few lenders are willing to lend them the money.  As a result, homeownership allows households to amplify any appreciation on the value of their homes by a leverage factor.  Even a hefty 20 percent down payment results in a leverage factor of five so that every percentage point rise in the value of the home is a 5 percent return on their equity.  With many buyers putting 10 percent or less down, their leverage factor is 10 or more.”

 

2. You’re paying for housing whether you own or rent.  “Homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord.”

 

3. Owning is usually a form of “forced savings”.  “Since many people have trouble saving and have to make a housing payment one way or the other, owning a home can overcome people’s tendency to defer savings to another day.”

 

4. There are substantial tax benefits to owning.  “Homeowners are able to deduct mortgage interest and property taxes from income.  On top of all this, capital gains up to $250,000 are excluded from income for single filers and up to $500,000 for married couples if they sell their homes for a gain.”

 

5. Owning is a hedge against inflation.  “Housing costs and rents have tended over most time periods to go up at or higher than the rate of inflation, making owning an attractive proposition.”

 

Bottom line?  Homeownership not only makes sense from a social or family reason, it also makes good financial sense.

 

HARRY’S JOKE OF THE DAY  (courtesy of Tatiana Bailey, Ph.D.)