Joe Boylan's Colorado Springs Real Estate Blog

Nick Timiraos at the Wall Street Journal has written a great distillation on a paper recently published by economists from Federal Reserve Banks of Atlanta and Boston. I am excited to finally see in writing what Realtors on the ground have known for a while. There are a lot of myths and misnomers in the media and the general public about the the housing bust and the subsequent mortgage meltdown. If you're interested in a realistic view of what happened to the housing market, please give this a read.

Twelve Facts That May Surprise You About the Housing Bust

This is the National Association of Realtors “Nationwide Open House Weekend”. Boylan and Company is participating with two great properties.

We have just finished our Quarterly Market Report for the Colorado Springs Real Estate Market. The big take away this quarter is the overall lack of inventory. Realtor.com has confirmed that dwindling inventory we have seen on a local level, is actually a nationwide trend. Colorado Springs saw a 26% drop in inventory over the past year but apparently that is not as significant as we thought. Realtor.com tracks market data in 146 metros, their data shows that the nationwide inventory of residential homes for sale has dropped 21% in March as compared to a year ago.

Although 26% initially seemed very high for the Colorado Springs Real Estate market, areas like Oakland, California have seen drops in inventory levels as high as 51.9%. The good news for those that want to sell is that this lack of inventory should start to impact listing prices with upward pressure, especially as we head into our busy selling season.

To download a copy of our Quarterly Market Report Click Here.

Finally we see some good news for the higher end home market. The "Mortgage Bankers Association" reports the average size of a mortgage purchase application increased 9 percent from December to the end of March, from $214,500 to $233,300 in March.

Really good news for the Colorado Springs Real Estate market because these numbers are just above our median home price of $180,000. Our hope is that as homes sell those buyers stay in our market and move up to more expensive home.

Here is a more in-depth look at this report from CNBC

I love good infographics. Mint.com not only creates great infographics, they also do a wonderful job of explaining complex concepts in an objective manner. So, when I came across these infographics, I really wanted to share them on our site, so here is a great explanation of Inflation.

Mint.com created this great infographic on "Deflation". I think it does a great job of explaining deflation, so I wanted to share it with our users! Please take a look:

I just finished compiling the rental rates on our property management site. The numbers weren't particularly impressive, this is Colorado Springs and our rates tend to move more like a tugboat as opposed to a race boat.

The thing that really stood out to me was the trend for larger properties to lease rather quickly. In the past larger lease homes tended to linger on the market for a while. The sweet spot in the Colorado Springs Rental market has always been the 3 bedroom single family home.

Beginning in April of 2011 we started to see larger homes (5 or more bedrooms) lease and at a brisk rate. In talking with the people I show our listings to they are generally people that never thought they'd rent again but due to the economy and the current real estate market they find themselves having to rent and needing a lot of bedrooms.

I think this signals a big opportunity for any homeowner sitting on a vacant home for sale. This also seems like something banks might take a look at as well.

We are addicted to web-analytics, we obsess on them daily. We think this is a healthy obsession for a bunch of reasons. It feels like productive snooping because it allows us to spot trends so we can maximize our web content in order to appeal to our users.

This also helps us spot trends in the Colorado Springs real estate market. The latest trend we are observing is the shift from home buyers to home renters. In the last 60 to 90 days we have seen a drastic uptick in the number of website visitors looking for rentals. This is interesting and a little alarming because we are moving into the residential resale market’s busiest time of the year. This is a time we should be seeing sale home searches skyrocketing but instead, rental interest has surged. The attached graphic shows rentals a #5 on our content popularity list. This would normally appear in the #12 to #18 range.

Coincidentally, I received a call this week from a long time client that lost a home a couple of years ago when the economy first took a downturn. He is in his late 50’s and looking for a rental. I asked if he wanted to try to buy again, his response was that a financial advisor had told him that since he was nearly 60, he should spend the rest of his life renting! I personally think this was questionable advice but clients believe what they choose.

This call illustrates the fact that there is a whole new class of renters out there. These are people that previously owned homes but lost them. They never imagined they would rent again. Combine this group with move-up buyers that aren’t eligible for a VA loan, are outside of the FHA loan limit and don’t have the 20% needed to avoid private mortgage insurance and the military people that know they won’t be here long enough to buy and sell, so they rent  and you have an overcrowded pool of potential renters.

Situations like this are opportunity rich environments and given the inventory of available homes, this is a great opportunity for investors.  If you have cash and are going to stay in the area for a long time, Colorado Springs is a great buy and hold market. Colorado has a cyclical economy, so when the cycle is down (bust) it’s a great time to invest because when the economy is boom, you can liquidate. Most people understand this concept but are either lack the stomach for risk or the resources to take advantage.

If you are interested in capitalizing on the current market, please contact us about where we see the best opportunities in the Colorado Springs Real Estate market.

At 4:00 p.m. today we moved the SpringsHomes.com home search from the old IDX platform to the new RETS standard. Although we are not completely updated, the switch seems to have been successful. We have a small mapping issue to work out in the Chrome browser and some photos need to be downloaded but aside from that everything looks good so far.

If you have any problems using our home search tool, please feel free to give us a heads up and send us feedback on this new system.

SpringsHomes.com will be making a big change to our home search tool. On Monday, April 18th at 4:00 p.m. the SpringsHomes.com home search tool will be offline while we change the backend process we use to serve up real estate listings for our clients. We have used the same system for over 10 years, and although it has been reliable, it has had its limitations.

We are excited to be moving to a new system called RETS (Real Estate Transaction Standard) this system will allow our users to search and receive results much faster and the data will be more current. Our understanding is that as soon as a new listing is entered into the Pikes Peak MLS, the RETS system will make it available to our clients. Additionally, we will be able to offer a wider range of search and data fields as well as higher quality photos.

Based on our testing through the development process, we think we are offering our clients a much better product. Look for the new search to come back online Monday evening and as always, please send us your feedback.

Here at “Boylan and Company”, we are fortunate enough to work with a lot of home buyers. There are a lot of hidden benefits to being involved with so many home buyers. The most valuable is the first hand knowledge you gain about what buyers are looking for and why. You also get some great questions, one of my favorites usually comes from people relocating from warmer climates, “Why does every house have a basement?”.

In warmer climates, Texas, Florida, California, etc... Homes are built using a method called “slab on grade”. This method consists of a concrete slab poured into a mold, directly onto the prepared dirt, much like a sidewalk or driveway. This method is very cost effective due to the lack of excavation costs.

Unfortunately, we aren’t able to use this method here in the Pikes Peak Region. The primary reason is Frost and associated Frost heaving. Frost heaving occurs when ice forms in the soil surrounding the foundation walls and expands, actually cracking or heaving foundation footers and walls.

When you build a home in the Pikes Peak Region the preferred choice of foundation is either basement or crawl space. Both of these options allow the builder to get the mostimportant parts of the foundation and home below the frost line, eliminating frost heave at the foundation. This means we have to build using the more expensive “Spread Footing Foundation”. This method consists of pads or footers of concrete, poured well below the frost line, in the Pikes Peak Region this means at least 4 feet below grade. These pads in turn transfer the loads from the foundation walls and house to the soil or bedrock below.

Footer forms set well below frost line

Now we get to the crux of why we have so many basements here in the Pikes Peak Region. Crawl spaces have to be at least 4 feet deep and cannot be counted as square footage in the home. Basements on the other hand, range in depth from 8 to 10 feet and are counted in the total square footage of the home. Both a crawl space and a basement require excavation (digging). This is expensive but a good portion of that cost comes from getting the equipment and operator to the building site. Once the digging starts, the cost of going from 4 feet of unusable crawl space to 8 or 10 feet of usable basement isn’t much in the big picture. On the up side, by paying a little more on the front end, you add a large amount of cost effective square footage to the home.

JPMorgan Chase and Company today acknowledged at a hearing before the Veterans’ Affairs Committee that the mortgage lender had made serious mistakes that affected thousands of troops and has subsequently refunded them for overcharges.

According to the Service members Civil Relief Act, active-duty troops pay no more than 6 percent interest on debts and most importantly aren’t supposed to face foreclosure.

According to a lawyer representing service members, problems emerged during recent mobilizations for fighting in Iraq and Afghanistan: For More Information

The Lewis-Palmer District #38 School District is offering choice enrollment for next fall until February 25th. 2011. This option is available for all grade levels at all schools. Additionally this opportunity is available to students from both inside and outside of the D-38 attendance area boundaries.

The forms and information about the program are available online http://www.lewispalmer.org . Parents or guardians of current Lewis Palmer students can complete an enrollment application using their “parent portal” account. Non-resident students may submit a printed copy of application to the Lewis-Palmer Administration building. The building is located at

146 Jefferson Street
Monument, CO.

Beginning January 1, 2011 Colorado House Bill 10-1278 will take effect. This bill charges the Colorado Real Estate Commission with the creation of an HOA Information Office and Resource Center. This office will provide information on the rights and duties of homeowners and associations under the Colorado Common Interest Ownership Act. This Office will be responsible for tracking inquiries and complaints.

All Colorado Homeowners Associations will be required to register with the Division of Real Estate on an annual basis. The estimated cost of registration looks to be $20.00 for the first year with a reduction to around $15.00 for subsequent years. However, the cost associated with registration is capped at $50.00 per year for an association and the fee cannot exceed the actual amount needed by the Division to fund the operations of the HOA Information and Resource Center. While every association in Colorado will be required to register with the Division, the following associations will not be required to pay the registration fee:

• Associations with annual revenue of $5,000 or less; or
• Associations not authorized to levy assessments and do not have any revenue.

According to the Colorado Springs Economic Development Corporation, here are the top 10 reasons to locate in Colorado Springs:

• Quality of life! - Outdoor, healthy lifestyle. Fittest city in America. Restaurants, nightlife, recreation. Garden of the Gods, Pikes Peak, trails, open space, wildlife.Dry, sunny mountain climate - No extreme temperatures. Average high in January is around 45 degrees. Average high in July is around 75 degrees. Little precipitation. More than 300 days of sunshine per year.

• Low cost of living - It’s affordable to live here. Housing is moderately priced. Cost of living is below the national average.

• Strong corporate environment - 27 Fortune 500 companies have a presence in Colorado Springs.

• Educated workforce - As a metro area we have one of the highest educated workforces in the country.

• Exceptional talent - Thousands of electrical engineers, software engineers, aeronautical engineers, systems administrators, executives, creative artists, business consultants....we have it all.

• Low Taxes - Colorado Springs and El Paso County offer the lowest tax burden in Colorado. Lower taxes than most of the country.

• Excellent Colleges - The University of Colorado at Colorado Springs is one of the best master’s degree institutions in the country. Colorado College is one of the top liberal arts schools in the nation. Pikes Peak Community College has more than 125 programs of study, offering associate’s degrees and various certifications. Colorado Technical University offers technology-driven degrees for every stage of a career. The Air Force Academy is one of the most demanding and rigorous institutions in the country.

• Excellent Schools - Colorado Springs school districts are among the best in Colorado and in the nation.

• Low Utility Rates - Colorado Springs Utilities, a public utility, offers some of the lowest rates West of the Mississippi.

Boylan and Company is excited to announce the addition of our a new property management division. Our goal was to create a service...