August 8, 2011

HARRY'S WEEKLY UPDATE

A CURRENT LOOK AT THE COLORADO SPRINGS RESIDENTIAL real estate MARKET

 

THINKING OF BUYING A HOME ?  HERE'S SOME REASONS FOR DOING IT RIGHT NOW

 If you have been delaying buying that new home, either as a residence or as an investment, here are a couple of reasons for getting off the dime and making your move right now:

 

  • Mortgage rates and fees are on the verge of going up. Although you can now get a loan for as low as 4% - 4.25%, that's going to change soon. S&P warned that they may downgrade Fannie Mae and Freddie Mac and that will push rates up. Also, loan fees are going up and credit requirements are tightening. The bottom line is that, if you qualify for a loan today, you had better strike, while the iron is still hot, or, you might have to pay a higher rate tomorrow.  
  • If you have been delaying your decision to buy and home prices take another downward slide, you might not end up with as much equity in your present home, thus making it more difficult to qualify for a loan
  • Inflation is an inevitable consequence of printing more money ..(and we have done a lot of that lately). The coming Inflation will raise all prices, including home prices.

 And, as far as buying a home as investment property is concerned, remember that, "Everybody has to live somewhere". With homeownership falling (65.9% in 2011 vs. 69.2%in 2004), because of foreclosures and tightening credit requirements, more people are now being forced to rent. This creates an opportunity that has persuaded many smart investors to buy rental property.

 As we emphasized in our last issue, a lot of "Big Money" is getting into the investment property game. Buying foreclosed properties has long been an activity for mom-and-pop investors, but now hedge funds, private equity firms, pension funds and university endowments are dipping into that market. They see that, within the last couple of years, rentals have gone from 20% to 30% of the housing market and they see that the double-digit returns shown by investment property are much better than the low yields which other income investments are showing.

 Keep in mind, also, that Colorado Springs has historically out-performed the rest of the country in real estate appreciation.

 Perhaps you should discuss this option with us. It could improve your entire investment portfolio.

 Call us at (719) 598-3200 or 1-800-877-MOVE (6683)

 

WAITING FOR 'JUST THE RIGHT MOMENT' TO SELL YOUR HOUSE? READ ON

If you have delayed putting your house on the market until there isn't as much competition (i.e until the inventory of available homes gets smaller), it looks like you might have a long wait. Many experts are predicting that 2011 will see a jump in inventory, as banks dump more foreclosures on the market.

To quote from the KCM blog, here are some of the industry publications that are predicting an increase in inventory and a decline in prices:

 

  • BLOOMBERG BUSINESSWEEK - "Housing prices will decline 6% - 8% nationally, with 6 - 7 million more foreclosures yet to come".
  • YAHOO FINANCE - "Housing prices will fall another 20% and underwater mortgages will balloon from 23% to 40%"
  • HOUSING WIRE - "JP Morgan analysts estimate a further drop of 4% in home prices from the first quarter of 2011 to a new bottom next year."
  • DS NEWS - "Most analysts expect further declines to characterize the later parts of the year and possibly extend into next year, largely because of the huge supply of foreclosures on the market"

The bottom line for prospective Sellers is that waiting might be a bad strategy. By waiting, if prices dip, your equity could go down and the number of competitors for prospective Buyers could go up.

Bottom line: If you are thinking of selling your home in the next 12 months, you would probably do much better if you sold sooner, rather than later.

Call us at (719) 598-3200 or 1-800-877-MOVE (6683)

 

LATEST SALES AND LISTING STATISTICS

The latest report from the Pikes Peak Association of Realtors shows that, :

  • Number of Sales in July 2011 was up 11.9% over July of 2010 (798 vs 713)
  • Prices in July 2011 were down 5.2% from July 2010
  • Median prices in July, 2011 were up 7.5% from June, 2011 ($198,950 vs $185,000)
  • 80% of all local sales were for homes under $299,999
  • There are now 20.8% fewer homes on the market than there were last year.

If you would like to examine all of the local housing statistics for July, 2011, please click here and. if you would like to discuss any aspect of the PPAR report, please give us a call at (719) 598-3200 or 1-800-877-MOVE (6683).

 

THE PARADE OF HOMES IS NOW OPEN

This year's Parade of Homes opened on August 5th and features 33 homes and 25 home builders. The main sites are located at Gold Hill Mesa, Cordera and Flying Horse.

We're excited to see that Homebuilders are confident that the market is coming back and we're looking forward to seeing you and the beautiful new homes at the Parade.

If you would like any information about the Parade of Homes, just give us a call at 719-598-3200 or 800 677-MOVE (6683)

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 39 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.

Finally, just click on the icon at the top of this email to listen to my podcast for this month.

 

JOKE OF THE WEEK

After sitting through the recent interminable Football Hall of Fame ceremonies, we were reminded of an old joke:

Three sons left home, went out on their own and prospered. Getting back together, they discussed the gifts they were able to give their elderly mother.

The first son said, "I built a big house for our mother."

The second son said, "I sent her a Mercedes with a driver."

The third son smiled and said, "I've got you both beat. You remember how mom enjoyed reading the Bible? And you know she can't see very well. So I sent her a remarkable parrot that recites the entire Bible and speaks three languages. It took elders in the church 12 years to teach him. He's one of a kind. Mama just has to name the chapter and verse, and the parrot recites it."

Soon thereafter, mom sent out her letters of thanks:

"Milton," she wrote son #1, "The house you built is so huge. I live in only one room, but I have to clean the whole house."

"Gerald," she wrote son #2, "I am too old to travel. I stay most of the time at home, so I rarely use the Mercedes. And the driver is so rude!"

"Dearest Donald," she wrote to her third son, "You have the good sense to know what your mother really likes. The chicken was delicious."

Donald immediately called his mom:

"Good Grief, Mom. That wasn't a chicken. It was a very valuable parrot. He could recite the whole bible and speak three languages".

Mom responded, "My Goodness !!! ..So why didn't he say something??