November 15, 2010 

HARRY’S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTAIL real estate MARKET

 

DOES HOME OWNERSHIP STILL MAKE SENSE ?

On November 9, 2010, Realty Times, a respected national source for information about the current real estate market, published an article titled, “Value in Homeownership”, based on  the recently released 2010 National Association of REALTORS® Profile of Home Buyers and Sellers survey. The article made several good points which are pertinent to our local market. Here are some comments that our readers might find interesting.

Is there value in owning a home? The NAR survey shows us that today’s homeowners are living in their homes longer, and after several years of price declines, are now seeing a rise in home equity gains.

Early in this decade many buyers jumped on the investment bandwagon. They bought and sold quickly, walking away with inflated profits. But as the real estate bubble burst, many speculators found they had bought at the top of the market and so, as prices fell, foreclosure rates skyrocketed. Historically, however, homeownership is a good, long-term investment, and one that brings many rewards.

NAR President Vicki Cox Golder explains, "Sellers who purchased at the top of the market and had to sell in a short time frame were hurt by the price correction, but the vast majority who were able to stay for a normal period of home ownership generally built enough equity to make a trade-up purchase. Despite swings in the housing market in recent years, the fact is most long-term owners have seen healthy gains in the value of their property. This underscores two simple facts – home ownership encourages stability, and the longer you own, the better your investment. Many of the house ‘flippings’ and quick gains which occurred during the boom period were abnormal, driven by risky, easy-money financing that should never have been allowed in the market."

"The primary exception to the disappointing ‘house-flipping’ trend was in the case of experienced investors, many of whom paid cash and who are making renovations or improvements after a careful study of properties, neighborhoods and market demand," Golder said. These savvy buyers are still making money.

However, even in its current slow state, the real estate market is far from dead. Surveys show that Americans are still buying homes, primarily because of the desire to own a home, the desire for a larger home, a change in family situation, to take advantage of the home buyer tax credit, to make a job-related move, or to take advantage of the current over-supply of affordable homes.

And today, homeowners are staying put longer. A typical seller has been in their home for 8 years, and the survey shows that first-time buyers are planning to stay for 10 years, and repeat buyers for 15 years.

Even with the recent decline in home prices, the typical homeowner who purchased a home eight years ago has experienced a median equity gain of $33,000, a 24 percent increase, while Homeowners who have been in their homes for 11 to 15 years have seen a median gain of 40 percent. So, considering these facts, it’s easy to see why the decision to buy a home for the long-term is once-again coming into favor with the public.

The bottom line is that the decision to buy or sell a home should be, as always, based upon a knowledgeable study of the local market, specific neighborhoods, current inventory, available mortgage rates, and pertinent market trends. If you are considering buying or selling your home, we stand ready to provide you with this kind of expertise. Call us.

SELLERS ….IT’S TIME TO DECK THE HALLS …BUT NOT TOO MUCH

Traditionally, the last several months of the year are pretty slow for real estate sales. However, there still are prospective Buyers out there so, Sellers, if your house is on the market, you should try to make it as attractive to them as possible. Give yourself a competitive edge. While your competition is busy going over the meadow and through the woods to Grandmother’s house, you can spend your time gift-wrapping your house in a big Christmas bow and getting it ready to sell.

November and December might discourage some prospective Buyers, but don’t give up. Many real estate experts note that if you have buyers dropping by your open house or making an appointment to view your home during the holiday season, there’s a good chance they’re serious buyers.

So, while this time of year often brings out all the holiday decorations, there is such a thing as too much holiday cheer. Remember that not all buyers celebrate the same holidays.

A good rule of thumb is to keep decor simple and subtle. If you celebrate Christmas, go ahead and put up a tree, but don’t put one up in every room. …and maybe leave Santa off the roof, this year. Make it easy for Buyers to imagine their own holiday celebrations and their own lives in your home.

Outside, settle for a nice holiday wreath and some subtle seasonal decor. Keep in mind that curb appeal is what gets buyers in the door.

Stash the gifts and just bring them out on the day you celebrate. Presents under the tree take up precious floor space and they are a distraction. Keep them out of sight, together with the family pictures, to stage your house properly.

Another nice touch is to spruce up the mantle. However, keep family and/or pets’ names off the stockings. Again, you’re trying to encourage the Buyer to imagine what the home will look like when it is “their” home.

So, with these tips in mind, have yourself a merry little Christmas.

 

THINGS ARE LOOKING UP

We just received a nice note from Robert August, President of S. ROBERT AUGUST & COMPANY, INC., in Centennial, Colorado. Bob is a long-time friend and an expert in housing trends. Below, we are including some encouraging information from him about our national and local and national real estate market (together with some of our own comments).

As we know, the housing recovery is dependent upon job creation and while the 317,800 jobs created in the 12 months ending September may not sound exciting, it sounds pretty impressive when you compare it with September of 2009 with 5,604,400 jobs lost over the previous year. 

Nationally, 30 states showed positive growth for over the past year.  Texas added 166,600 jobs, just shy of the next 6 top job growth states combined.  The state of California continues to lead the country in job losses (62,100) but has certainly shown improvement over the past year.

The District of Columbia added 22,500 jobs which would make it the number 10 state in job growth (if it were a state) and when added to Maryland and Virginia the job growth total for the region balloons to a healthy 76,500 jobs in the past year.  Furthermore, the Washington, DC metro area easily leads the nation in job creation with 56,100.

Hmmm …Washington seems to be doing quite well.

Bottom line: The economy, including job growth and housing, continues to improve; the problem is the improvement has been so gradual that it doesn’t feel like it.  We are moving, however, toward equilibrium in the marketplace, and as the foreclosure mess is wound down the housing industry should benefit from years of pent-up demand.

To see the complete charts on permits, click here

To see the complete chart on jobs, click here

And, please remember, I would be honored to serve as your Broker for all of your residential real estate needs. I want to help you, my reader, make the most prudent and accurate Real Estate business decision.

Also if you know of anyone who desires to buy or sell local real estate, or, who is moving in or out of the Pikes Peak region, remember that, with over 37 years of providing relocation and Real Estate services to clients throughout the country, I am uniquely qualified to assist them with the relocation process, including buying and/or selling their homes on both ends of their move. Please allow me to implement my negotiating skills on your behalf.

Just click on the icon at the top of this email to listen to my latest podcast. ….And, if you would like to learn more about our Job Loss Protection Program, or, about our CyberHomes Complete Market Analysis of a property, please contact us. 

 

LATEST STATISTICS

 Click here for the latest Sales and Listing statistics for the Pikes Peak area  

 

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