October Market Stats: '09 Better than '08

October 2009 surprisingly (or not so surprisingly, depending on how much you want to blame the tax credit expiring) outperformed October 2008 in average sold prices being higher ($261,771 in '09 up from $250,172 in '08) AND the better absorption rate (4.9 months in '09 vs. 5.5 months in '08). Although there were a bit more than 300 more closings in October of '08, there were also over 3,500 more listings in '08, making for much more choice and much less competition (it's competitive today, believe it or not!).

Check out the stats:

MLS Totals

All Areas Individually

Tax Credit is EXTENDED!!

To: All REALTORS® From: Charles McMillan, 2009 NAR President Date: November 5, 2009 Re: Congress Passes Tax Credit Extension/Expansion Dear Fellow REALTOR®, I am VERY excited to report that Congress has answered our call to extend and expand the homebuyer tax credit! Both the House and the Senate have passed an unemployment insurance bill, which includes an amendment that expands and extends the tax credit. That bill will be sent to President Obama for his signature in the next day or so. I have recorded a special edition of my President’s Podcast, with details on the new tax credit and when it takes effect. Please take just a couple of minutes to listen. http://www.realtor.org/about_nar/presidents_report/_podcast_archive/mcmillan_taxcreditextended_20091105 We also have posted a comparison chart on Realtor.org. This can be a helpful resource as you work with buyers to take advantage of the credit in the months ahead. http://www.realtor.org/fedistrk.nsf/files/government_affairs_tax_credit_ext_chart_110409.pdf/$FILE/government_affairs_tax_credit_ext_chart_110409.pdf On behalf of NAR, I thank you all for your participation in our advocacy efforts on this issue. Not only did we set a new record on responses to Calls for Action, but we helped move another step closer to a brighter future for America’s families and our economy. Sincerely, Charles McMillan, CIPS, GRI 2009 NAR President

The news is misleading! Tax Credit Extension – the real status

My friend just posted this:

Friends,
I found the news reports to be a little confusing regarding the agreed continuation and modification of the first-time homebuyer tax credit, so I contacted NAR (National Association of Realtors) to get clarification.

Here are the results of my conversation with Linda Goold. Linda Goold serves as the Director of Federal Tax Programs for the National Association of REALTORS® and works for the NAR in Washington, DC. She is an advocate for NAR tax policies that protect and enhance ownership and investment in both residential and commercial real estate.

I’m paraphrasing her comments:

The current news reports are misleading. Senate has agreed to the content of the home buyer tax credit extension with some modifications, BUT senate has not taken vote on final passage. It will be GOING UP FOR VOTE MONDAY EVENING at 5:30pm. Then it will have to go back to the house, but expectation is that the House will take it up the next day and approve it without amendment, and then it will go to the President.

When I asked how long it might take to go before the President, Linda said that sometimes it takes a while, and sometimes it will occur the next day – it has to be printed on parchment and go through an administrative process. This bill extension of home buyer tax credit is included in an extension of unemployment insurance benefits, which Linda says she has “to think the president will want to sign it as soon as possible. Hopefully it’ll be accomplished a week from now, but no guarantees.”

Aaron Lebovic
http://aaronlebovic.wordpress.com/2009/10/30/the-news-is-misleading-home-buyer-tax-credit-extension-the-real-status/

$8000 Tax Credit EXPIRES November 30th

3rd Quarter Neighborhood Price Change Map!

View the Map!

Denver Foreclosures are Plummeting

The number of distress sales, however, continues to plummet. Since were selling, relatively, more Cadillacs and fewer Chevys, it’s driving up our average price. The number of distress sales in August matched the 2007 sales level.

Average Home Prices going....up!

Continuing the great trend from July, the average home price in August was a little higher in 2009 than it was in 2008.

Home Prices Going Up - Video!

Home Sweet Home VIDEO: Your Castle's own Charles Roberts

Top 20 Cities for Young Professionals: Denver in Top 5

Denver ranked high in "Next Cities" rankings - the best places to live and work for young professionals. The study, conducted by Next Generation Consulting (NGC), tabulated the rankings after collecting and analyzing 45 measures for all U.S. cities with over 100,000 people.
"Simply being the cheapest place to live, or the city with the most jobs is not a long-term workforce strategy," says NGCs founder, Rebecca Ryan. Although jobs are important, Ryan says, "The next generation is very savvy about choosing where they'll live. They look carefully at quality of life factors like how much time they're going to spend in traffic commuting, if they can live near a park or hike-and-bike trail, and whether a city's downtown stays awake after five." The Next Cities list ranks cities that are - or have the capacity to be - great places to live and work for the next generation, because they have the best overall score in the seven indexes the next gen values.

Super Cities for Young Professionals with Population over 500,000

1. San Francisco, California
2. Seattle, Washington
3. Boston, Massachusetts
4. Washington, District of Columbia
5. Denver, Colorado
6. Austin, Texas
7. Baltimore, Maryland
8. Portland, Oregon
9. New York City, New York
10. Columbus, Ohio
11. Milwaukee, Wisconsin
12. Charlotte, North Carolina
13. Chicago, Illinois
14. Nashville, Tennessee
15. Jacksonville, Florida
16. Tucson, Arizona
17. San Antonio, Texas
18. Los Angeles, California
19. San Diego, California
20. Houston, Texas

Trends

We noticed that the average sales price iS region AUN (Aurora North) and DSW (Southwest Denver) increased in June. After significant declines in 2006 and 2007, prices were generally stable in 2008. Prices are now edging upwards in these distressed areas!

The Home Inspection Explained

$8,000 Tax Credit Q & A

Fix & Flip Class

Denver Trends from the 1800's

Denver Home Prices Up a 3rd Month

Denver Business Journal - by Mark Harden

Home prices in Denver rose in May for the third consecutive month, and the city scored the second-lowest year-over-year price decline of the 20 cities included in Standard & Poor's closely watched S&P/Case-Shiller Home Prices Index.

Released Tuesday, the index reveals how 20 cities are faring as the economy continues to batter the residential market.

Home prices in Denver rose 1.3 percent in May from the previous month, according to the index report. That follows a 1.5 percent rise in April and a 0.1 percent gain in March.

Denver prices fell by 1.7 percent in February and 2.7 percent in January.

Among the 20 cities in the S&P/Case-Shiller index, Cleveland saw by far the greatest month-to-month home price rise in May, 4.1 percent, followed by Dallas (1.9 percent) and Boston (1.6 percent). Denver was tied for the fifth-highest month-to-month price increase in May.

The greatest month-to-month price decline among the 20 cities was in Las Vegas (down 2.6 percent).

Denver home prices fell 4.6 percent in May from the same month in 2008, the index shows.

That's the second-smallest drop of the 20 cities in the index, bested only by Dallas' 4.1 percent year-over-year decline. Boston was No. 3 with a decline of 7.2 percent.

At the other extreme, home prices plummeted 34.2 percent in Phoenix between May 2008 and May 2009, the index showed. Other big year-over-year losers were Las Vegas (32 percent), San Francisco (26.1 percent) and Miami (25.2 percent).

The 20-city composite index shows home prices were up an average 0.5 percent in May from the previous month, and down 17.1 percent since May 2008.

Nationwide, "the pace of descent in home price values appears to be slowing, ... [but] we likely do have a way to go before we see sustained home price appreciation," David Blitzer, chairman of the Index Committee at Standard & Poor’s, said in a statement.

The index is compiled by comparing matched-price pairs for thousands of single-family homes in each market. It is published by Standard & Poor’s and Fiserv Inc.

Click here to download the index in PDF format.

FirstAmerica CoreLogic home-price report, released July 22, also showed Denver outperforming the nation on home prices.

In case you haven't heard...

Forbes: Denver is America’s best city to buy a home

Forbes rankings seem geared more toward each market’s current and future potential as a place to buy a home, since some of the cities at or near the top of the list are among those hardest hit by the recession.

The report ranked the 25 largest U.S. metro areas on the basis of change in price per square foot, frequency of real-estate transactions, and how evenly distributed home-sales activity is in a metro area.

“Denver tops the list,” Forbes said. “It had 25 percent of its property sales occur within approximately 25 percent of the city’s ZIP codes. This means sales in various parts of the city were fairly evenly distributed, showing proportionate activity. The further a city deviates from the 25 percent mark, the less evenly distributed the market is in that city, and thus the lower that city ranks.”

Forbes also determined that average price per square foot of housing space increased 5.7 percent in Denver between February and March of this year, and that transactions decreased 8.4 percent between March 2008 and March 2009, less of a drop than many cities.

“Denver scores very well in terms of being able to bring people into a stable housing market,” the magazine quoted Moody’s economist Christopher Cornell as saying. “It has better growth potential than most cities today.”

From The Denver Business Journal http://denver.bizjournals.com/denver/stories/2009/06/22/daily46.html

Real Estate Market Trends

De-Mystifying the Home Buying Process

Buying a house can be an overwhelming, and even exhausting process. I want to make it as easy as possible for you so that you have a headache-free, and even fun experience! These are the 9 steps we'll follow to ensure you have a smooth and enjoyable purchase:

Your Home-Buying Process Step-by-Step!

1) Needs Analysis: You’ll fill out a Home Preference Profile to help me understand both your wants and your needs, and to help you get a clearer picture of the perfect home for you.

2) Pre-Approval: You’ll then get pre-approved by a recommended loan officer who will use your credit and qualification status.

3) Target Neighborhood Information: I'll create a broad neighborhood search profile matching your desired area and price-range using my Your Castle tools.

4) Home Search: I’ll run a search according to your criteria, and you will select the available homes of your interest and we will set up a time to take a tour to see them. Before we go on tour, we’ll have to sign the Buyer-Agency contract to make our agency-relationship explicit.

5) Make an Offer: I’ll run comps on the home(s) that you like and are ready to write an offer on to get an idea of what the neighborhood is selling for. I will write the offer contract for you, and advise you on the terms and numbers for the offer. You’ll sign the offer, and I’ll present it to the listing agent.

6) Negotiation: If they submit a counter-proposal, I’ll present it to you and advise you on what I think, and you can either accept it or make a counter-proposal.

7) Under Contract: I’ll guide you through all the dates & deadlines of the contract (title, inspection, appraisal, survey, loan conditions deadline, etc.) and recommend trusted vendors like an inspector, sewer scoper, etc., and make sure things run as smoothly as possible! If something is seriously wrong with the house that comes out in the inspection for example, you will be able to exit the contract and get your earnest money back. 

8) Pre-Closing: We’ll be in touch with the loan officer and make sure everything is approved for the loan, and all documents are prepared and any monies are ready for closing.

9) Closing: Congrats! Sign the papers and move into your new home!!!

$8,000 Tax Credit

Our own Charles Roberts talking about the $8,000 First-Time Home Buyers Tax Credit on 7News.

Facing Short Sales as a Buyer: Fight or Flight?

I'm currently working with quite a few buyers that are becoming rather frustrated with the amount of deals they like that end up being short sales. In this ever-changing market, adaptability is key for success. And right now, being able to adapt to short sales can provide a good discount and a good buy...IF (and I cannot over-emphasize this!), IF you have the time and patience.

*The only way a Buyer can really understand why a short sale is so long a complicated, you'll first have to understand what the Seller has to go through (see below).

What is a Short Sale?

• Put simply, a short sale happens when the bank approves the sale of a home for less than what is owed to the bank.
• By accepting a short sale, the lender can avoid a lengthy and costly foreclosure, and the owner is able to pay off the loan for less than what he owes. Short sales can be a win-win for everyone.

What causes a Short Sale?

• 1) The Home's market value has dropped, being less than what is due on the loan
• 2) The mortgage is in or near default or late status
• 3) The Seller has a legitamate hardship: unemployment, divorce, medical emergency, sudden illness, bankruptcy, or death.

3 Stages of the Pre-Foreclosure Process

1. Default (1 to ? Months)

2. Acceleration or Notice of Election or Demand ("The list").

3. Foreclosure (Banks want to avoid this).

3 Keys to a Successful Short Sale (on the Seller side)

1. Knowing the proper step-by-step process, depending on the type of loan that you are shorting. The process for shorting an FHA loan is different than the process of shorting a VA or Conventional loan. So knowing the proper steps, and the order of those steps, is critical.
2. Knowing what components each of the Lenders require for their Short Sale Package, getting a copy of the Lenders Short Sale Package in a timely manner, and then submitting that Package, in its entirety and in a format that will get the banks attention, meet their requirements and ultimately get you an approval.
3. Knowing what the Lenders have to “net” in the Short Sale. All Lenders have a bottom-line amount or percentage that they have to “net” in the transaction. Knowing that net is absolutely imperative for you, the Agent, to know so that you know where to price the property in MLS, so that you generate an offer that will be both quick, but also sufficient to enough to meet the bank’s net requirements, cover all of you clients closing costs, as well as cover all the commissions at closing.

Basic Short Sale Package (for the Seller)

• Authorization to Release Information Form
• Hardship Letter
• Financial Worksheet
• Listing Agreement
• Copies of Tax Returns (last 2 years)
• Copies of All Bank Statements (last 2 months for all borrowers)
• Copies of Pay Stubs (last 2 pay periods for all borrowers)
• Application for Pre-Foreclosure Sale Program (if FHA, HUD Form 90036)
• Homeownership Counseling Form (if FHA, HUD Form 90038)
• Purchase Offer (if there is one yet)

Once all this is filled out, the bank has an offer both seller and Buyer have agreed to, then it's a matter of waiting for the bank's approval. After the bank's approval, everything is smoother.

In short, if you have the time and patience to wait 45-120 days to close on a short sale, knowing that the whole thing could fall apart at any time, then you have the stamina for dealing with short sales (and saving a lot of money in the process). If you need a house soon, and hate waiting for bank responses that take weeks (if not more), stay away from short sales.

If you are thinking about buying a short sale, please let me know, I will guide you through the whole process. Plus you'll get $8000 if you're a first-time home buyer!

2nd Quarter 2009 Your Castle Neighborhood Price Change Map is here!

What's your neighborhood doing?

Every neighborhood in Denver and metro is different. Location really does affect everything.

See what your neighborhood is doing on our updated neighborhood price change map not available anywhere else in real estate.

Explanation: the map is color coded according to what neighborhoods are depreciating (red) and which ones are appreciating (green), from comparing the most recent 12 months with the previous 12 months to get an apple-to-apple comp. Also included is the average sold home price, percentage of foreclosures of all sold homes in the last 12 months, & the average days on market for each neighborhood.

Need a map for a different area? Just let me know.
-Only at Your Castle (= very nerdy)

Denver cities Months of Inventory

So, months of inventory is the time it would take to sell all of the homes on the market if the rate of sales in the last year continued at its current pace. 6 months is considered a "balanced market". More expensive homes have more inventory.

City -Average Sales Price-Months of Inventory

Federal Heights-$110,000 -2

Northglenn-$151,000 - 2.8

Commerce City-$149,000-3.4

Aurora- $180,000-3.4

Thornton- $195,000- 3

Wheat Ridge-$235,000-4

Westminster- $235,000-4.2

Denver- $235,000- 4.6

Lakewood-$251,000-4.8

Arvada-$251,000-5

Englewood-$280,000-4.2

Centennial-$300,000-4.3

Littleton- $320,000-5.2

Highlands Ranch-$345,000-4.6

Broomfield- $340,000 -5.7

Morrison- $320,000 -7.3

Parker- $350,000 -6.9

Golden-$415,000- 8.6

Castle Rock-$425,000-11.3

Evergreen-$475,000-14.3

Denver Ranked #1 for real estate rebound

First, what are the characteristics that make a city rebound and revitalize?

1) Job growth potential -related to real estate value in every way.

2) A growing population

3) Good weather

4) Lots of 1st time home buyers - the most important people in market place

5) No overbuilding of condos or office spaces (not happening in Denver)

6) Vital downtowns

7) Well-educated population

8) Large number of foreclosures early - those cities that went down first usually come out first.

So Denver has all of the above characteristics: Our population grows about 2% per year. We have a huge employment base. Great weather. Very vital downtown (just go there on a Friday night). A well-educated population - due to both being a university/college town. Tons of youth and young adults. One of the biggest park systems in the nation. Endless outdoor activities for all 4 seasons. And it's one of the most affordable desired cities in the west (cheaper than all our cometitors, including Phoenix, L.A., San Diego, Las Vegas, Seatle, and Salt Lake City).

Visit msnbc.com for Breaking News, World News, and News about the Economy

Denver MLS June Stats are out

The June Market Statistics for the Metro Denver are out. As you can see sales are still strong in Denver. There were 3,328 closings in June, and 15,432 closings year-to-date for 2009. The average sold home price in the entire Metro area is $283,312, only $3,575 less than the average sold price this time last year. That is only 1% less...an extremely marginal percentage in light of what other cities are going through. Although there are a bit fewer closings in 2009 than 2008, there are 4,315 fewer listings now than in June 2008. That makes the absorption rate (absorption rate just means the number of months it takes to sell all the homes on the market at the current buying pace) only 4.7 months now, vs. 5.3 months one year ago...houses are selling like hotcakes in Denver, especially under $250K. Check out this PDF for details of whatever area you are interested in: http://www.ltgc.com/files/marketstats/entire.pdf

News about Denver: We're PASSED Bottom

When Will We Hit Bottom? How to Know When the Market Hits Bottom

Not only did the TODAY show rank Denver the #1 city in America for the real estate rebound, but there is much hard evidence that Denver is passed bottom (including the number of bids on every good property under $200K...some up to 37 offers!).

Explaining the Charts Below:

The National Association of Realtors defines a "balanced" market as having 6 months of inventory:

• Less than 6 months is a Seller's Market: homes are selling relatively quickly and there are more buyers chasing homes.
• More than 6 months is a Buyer's Market: homes are selling relatively slowly and there are too many homes on the market.

While Denver has been a Buyer's market the past several months, the inventory of homes on the market in Denver has been declining. This is not true in many regions of the country.

Denver is at about 5 months of inventory...1 month LESS than a balanced market, making it actually a Seller's Market according to NAR. I've actually experienced this writing offers for clients - if the house is well-priced in a good neighborhood, or well under market-value, it's almost guarenteed there will be a bid war between buyers. The home ends up selling for more than the asking price!

It's a mixed issue. Lower cost areas, such as Thornton, are seeing inventory move fast. Sellers (mainly banks) don't have to wait long for offers. Thornton's average price in the last year was around $250,000 and the average MOI (months of inventory) was about 3 months. Greenwood Village, on the other end of the scale, had about 13 MOI and an average price of about $1.4 million. Sellers are suffering there. The city of Denver is about in the middle.

The second CHART below compares REO's (lender owned) homes to regular homes regarding inventory, solds, and months of inventory. It is jam-packed, but very helpful once you look at it. The main principle here is that neighborhoods with homes under $225,000 are selling fast, while upscale neighborhoods like Cherry Creek and Hilltop have significant levels of inventory and it's taking a long time to get homes sold, especially over the $1 million price barrier.