SpringsHomes 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

I just finished my first instructional video for this website. I must say I was very nervous but am really happy with the results. In the video I give a general overview of how FHA loans work and why they might be a good choice. Please take a look.

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

I keep telling my buyers the market has changed.  Multiple offers on houses is the new norm, and the highest bidder gets the house.  Here is an example of what I mean:

The last two contracts I have written for buyers have both had competing offers coming in at the same time.  The first one went smashingly well.  I warned my clients "you have competition."  They offered $5,000 OVER asking price, and they got the house. The next one didn't go so well.

It was last Wednesday.  We knew we had competition going in. Another offer on the house had been submitted earlier that day.  But, according to the listing agent "the offer was low."  Based on that information, my buyers offered full price but asked for closing costs to be paid by the seller (a typical and reasonable request).

What I learned later was the listing agent called the other party, told them we were bringing in a competing offer, and they upped their price.  We got outbid.  And I had the sad task of calling my sweet, first time buyers and telling them that they didn't get the house, the one they were so excited about.

To make matters worse, I just learned that I know the competing agent quite well. Rats!  Couldn't it have been some random agent that I've never heard of?  That would make this pill so much easier to swallow.

My buyers are bummed, needless to say. And we are back on the road looking at many houses in hopes to find another one that is perfect for them!

Inventory is off by 27% this year as compared to last year at this time.  Translated: there are fewer homes today for buyers to choose from.  I remember back in the early 2000's when inventory was so slim that buyers were in bidding wars. At that time multiple offers were the norm, and the house went to the highest bidder.

I have to wonder if we are returning to that type of market.  I do know that right now under $200,000 is the hot price range locally, and buyers are already starting to outbid each other.  According to another agent I know, her buyers just lost out on their third property because they keep getting outbid.

Today, in the Pikes Peak region there are 3,128 single family homes for sale.  AND

There are 383 condominiums/townhomes for sale.

I wonder how many of these for-sale properties will receive multiple offers.

Tax time is just around the corner.  Did you know that as a homeowner you will have some valuable income tax deductions?

Example:  Your mortgage interest is a deduction.  Let's say your house payment is $1,200 per month.  Of that amount, you might pay $900 towards interest. Multiply 900 x 12 (for 12 months in the year).  The answer is your annual tax deduction.  In this case, $10,800 would be your tax deduction.  Pretty cool, huh?

But wait, there's more!  Your property taxes for the year are another deduction.  Let's say you paid $1,300 in property taxes last year.  You get to deduct that on your tax return as well.

But wait, there's still more!  If you own a rental property, you can deduct the cost of home repairs and maintenance on it.

Buyers ask me all the time if purchasing a home is a good investment, especially during uncertain economic times.  My answer is YES!  Even if the home does not appreciate as quickly as you'd like, you are still saving money with all these deductions on your income tax returns.

Picture this:  You just bought a brand new home from a builder.  One month after closing you learn that the   subcontractors who did work on your home are now filing mechanic's liens against your property.  What do you do?

1. You can do nothing and know that those liens are only valid for 12 months.  After that, they either drop off or have to be refiled by said contractors.

2. You can sell or refinance the house, in which case those liens would have to be paid at time of closing.  But this is where title insurance would step in and help you.

If you go to sell or refinance the house, and you incur a financial loss as a result of such a lien, then your title insurance policy would pay for that loss.  It works much like other insurance, where once you incur a loss you file a claim and your insurance company pays on that claim.

Of course, this is the abbreviated version and there is a little more detail to it.  But at least it's good to know that your title insurance policy is there to protect you!

At the end of last month we had 3,959 active listings (houses for sale) in our area.  What I find interesting is of those 3,959, a lot of it is junk!  Today I was showing houses to a couple of buyers, and it was surprising how much of the homes were less than wonderful. We saw homes backing to busy streets, homes with old floors, old cabinetry, old fixtures, old appliances, strange odors.  The really nice stuff, the ones where you walk in the door and say "Wow," are few and far between.  Those are the houses which sell in record time.  Those are the ones with multiple offers, which often bring in top dollar prices. 

I think today's buyer has an expectation that homes should look really good. They want the granite counters, the high grade carpet, the pretty paint, the expensive landscaping.   They want the cool light fixtures and new appliances.  They want ambiance, style, the WOW factor! It doesn't matter if they are buying an 1,100 square foot bungalow or a 4,000 square foot sprawling rancher.  They want cool, classy, done right!  I know it exists.  I've seen it before.  I've sold it before. 

To sellers I say: Spend a little, make it pretty.  That will make it sell.  To buyers I say: You may have to open more doors these days in order to find your treasure.  But it does exist!

We recently received an update on our son's status with TCA's wait list. The Classical Academy (TCA) is a charter school located in Academy School District 20. ALL students apply to be on the wait list.

This email letter offers from great insight into their process and how they enroll students for the coming school year. They indicate here how many spots normally open up per grades.

Although months away, our TCA Registrar’s office is already planning for our 2012 fall enrollment at The Classical Academy.  We want to personally invite you to a special TCA Prospective Family Informational Meeting on November 29th at 7:00 pm, since your family has been on our waiting list for some time. According to our records, your child, ****** Mitchell, [I blocked this out for our privacy] is number 243 on the Kindergarten waitlist. We annually enroll 272 Kindergarteners, and frequently go through most of the waiting list to fill every Kindergarten seat. Each year, we also have openings for approximately 6 to 8 students in 1st and 2nd grade; 10 to 20 openings in 3rd and 4th grades; and 4 to 6 openings in 5th and 6th grades.  No matter your placement on the list, I encourage you to attend this important meeting to learn more about our extraordinary school.

TCA Prospective Family Informational Meeting

November 29, 2011

7:00 to 8:30 pm

TCA East Elementary Campus Gymnasium

12201 Cross Peak View 80921

(Between Pikes Peak Community College and New Life Church

FYI-address does NOT mapquest)

As a charter school, TCA is a unique learning community.  Our mission is to partner with your family in the education of your children.  Before you make this important decision, we want you to be fully aware of the expectations and commitments that are woven into the fabric of a TCA education. While there are special demands on TCA families and students, there are overwhelming "life" rewards for a TCA education.  Plan now to attend this important time to meet our leaders, have your questions answered, and learn more about the following topics.

• The TCA Approach to Learning--our philosophy and curriculum
• Our Core Values and how they apply to life at TCA—relationships, discipline, behavioral standards, etc.
• Our vision for our learning community--our students, families, and faculty
• The understanding and commitment needed to thrive at TCA

We look forward to welcoming you into the life of this wonderful school!

Sincerely,

Kara McIntyre

TCA Registrar

I'm a bit fired up this week.  I had to work with a mortgage broker who delayed a closing for us.  What the public needs to know is there is a DIFFERENCE between a mortgage banker and a mortgage broker.  A mortgage banker loans their own money.  They can make decisions in-house on your financing. And because they have their own money to lend, they already know what they can and cannot offer you in the way of rates, terms, etc.  And because of this, they are usually able to get loan approval faster and more efficiently, without last-minute surprises.

A mortgage broker does not loan on their own money.  He is the middle man, the guy who goes between you (the buyer) and the investor (who has the money to loan).  The trouble here is this middle man doesn't always know what requirements his investor will have. He can guess about the loan product he is offering you, but until he gets a final okay from his investor, he is just speculating about your loan.

Why am I fired up? Because all too often I see closings delayed due to last-minute surprises from mortgage brokers. This week, on the day of closing I got a 10am phone call from the mortgage broker, saying there were additional loan conditions which the investor was requiring.  Typically, loan conditions take a few days to be satisfied, so needless to say it's not cool to find out about additional loan conditions the day of.  Long story short, we did postpone closing and fortunately, buyers did have somewhere to live in the mean time.

But my advice, save yourself and your Realtor and the seller some aggravation.  When you contact a lender, ask if they are a mortgage banker and have their own money to lend.  If not, ask your Realtor to help you find someone who is.  It'll make the process of buying a home so much easier!

How do you recognize a good Realtor?  How do you decide who to hire when there are so many of us to choose from?  What makes an agent great versus just okay?  Below are some questions you might want to ask. 

IMPORTANT QUESTIONS TO ASK WHEN INTERVIEWING A REALTOR:

1. How long have you been in the business?

2. How many transactions did you close last year?

3. How many transactions have you closed this year so far?

4. Has all of your real estate business been local?

5. If not, where else have you practiced?

6. What percentage of your sales is listings? Buyer purchases?

7. Where does most of your business come from?

8. Besides the paycheck, what motivates you to do this work?

9. How are you different from every other Realtor on the street?

10. Would you consider doing something else for a living?

11. If you won the lottery, would you stay in the business?

12. What is your greatest strength?

13. What is your greatest weakness?

Hiring an agent is an important decision, folks.  I have developed these questions as a way to help you know who's right for the job.  I hope you'll find them useful.

You may or may not already know, there is a fly-in community just east of Colorado Springs adjoining the runways at Meadowlake Airport. Just 10-15 minutes from Colorado Springs, you can take either Woodmen east to Hwy 24 or Hwy 24 northeast from central Colorado Springs to Judge Orr Rd. Just a couple blocks east of that intersection is this great little airport. Adjoining it on the east and west sides are some homes that have personal runways and hangars for small, private aircraft.

In this link are the two homes I found, one gorgeous home available for $549,900 and one sold recently for $295,000. You can see a significant difference in their size, upgrades and age...

RES - Customer Full/All Photos  (click the link, to get from house to house, click the blue arrows by the property address near the top)

If you want help searching in a specific neighborhood such as this, I'm happy to help tailor a search to meet your needs. Whether you'd like to be alerted the moment a house comes up in a community such as a fly-in, or would just like to know what types of homes are available in the area and price range that meets your families' needs, let me know!

I have had a wonderfully busy week so far, is it really only Tuesday night?!?! I've logged over 250 miles already in the past two days with a great, fun couple from New Jersey (I'm convinced their not all corrupt up there ;-) ) Showing from Monument, Black Forest, Falcon, central Colorado Springs to Woodland Park. Along the way we stopped to enjoy some great scenery during my favorite season in Colorado!! Check these out... and it's upper 60s to upper 70s. GORGEOUS!!!

(ABOVE) Fall foliage from a gorgeous log deck outside Woodland Park, CO - Pike's Peak in the background - WOW!!

Back-lit cloud & pine trees in Black Forest, northeast Colorado Springs

One more high-mileage day to go this week with some families from Scotland!! Touring some potential home based business properties east and west of Colorado Springs.

Happy fall !!!

If you're a first-time home buyer in El Paso County, it's your lucky day!  El Paso County Bond money is now available for you.  What does this mean? 

There is free money available for first-time home buyers.  It's cash for down payment assistance, usually 3%.  Through this program you can buy a home and only put $1,000 out of pocket into the purchase.  The rest of your down payment is covered by the El Paso County Bond program. And the beauty is you do not have to repay it. It's a grant, not a loan.  Typically, it's used for an FHA loan which normally requires 3.5% as down payment.

The catch is you have to act fast.  This money is in high demand, and there is a limited amount of it.  It's offered by some (not all) lenders, and is available on a first-come, first serve basis.  I have worked with several first-time buyers who have utilized this program.  It's a great jump start for the buyer who wants to buy now but doesn't have a huge down payment saved up. 

People buying a home have a lot of questions. Since buyers, especially first-time buyers have to consider the expenses that come along with their loan. Some think they may also have to consider in their expenses, paying their real estate agent. Different states and areas have different customs. In MOST cases in our area, the seller agrees with their listing broker to pay a commission that includes a split for the Buyer's Agent or Transaction Broker working with the buyer. There are cases where the seller is a For Sale By Owner or few other instances where the seller will not pay. As a responsible agent, I notify any clients if I foresee a problem with the commission and if they will be expected to pay. This commission disclosure is included in the MLS, so agents know before showing a property. This information is not available on the public site, but can be easily discovered by members of the real estate board in the MLS.

This leads to another topic... can we help you buy a NEW construction home, the answer is YES!! Some people think it's easiest to just go into a new build site and buy a home yourself. Sometimes it is, but a local professional with experience can assist you in reviewing the builders' mondels and other homes under construction. I have been to a model home with a client, which they almost wrote a contract. We proceeded to ask to look at a couple of their other homes under construction. We looked at two other homes, one had a very crooked door jam and one had some flooring popping up. The bottom line is, if a real estate agent has worked here a while, they have experience with most builders and know if they have a fair, good or stellar reputation. We can help you do your research. As nice as the sales people are, they are representatives of the builder! Buyers have the right to a home inspection even in new construction. Although builders have regional building requirments to abide by, no home is perfect, even a new home... exxtra inspections can be very helpful!!  If we help you with a NEW home, the builder agrees to pay us as well... as long as we accompany on your visit, or you tell them you are represented by a real estate agent. 

Please let us know if you have questions or desire or representation for a new construction or existing home!!

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Colorado Springs and the Pike's Peak region is full of and surrounded by amazing scenery. There are MANY reasons to move here and thousands of people decide to buy homes in the area every year. Many come here with expectations of great schools, given to them by friends, co-workers or family. Others ask us, "what are the best schools in the area?" I struggle to answer this question, primarily because we are Realtors are not allowed to steer buyers in any direction. The second reason I struggle is because there is no BEST school. Each student is different, and their family needs and expectations vary... they might even vary between children within the family.

I often tell clients this brief story of my families' middle and high school experience. My older sister and I went through the Douglas County School system from late elementary through high school graduation. Both of us played sports and excelled in almost all of our classes. Our younger sister was (for lack of a better excuse) "hanging out with the wrong crowd" and not failing, but certainly not succeeding in the same schools where we excelled. My younger sister is VERY bright, talented and driven, but was not succeeding. Other life circumstances led my mom to move with my little sister in the midst of her high school years into, not an inner-city school, but definitely much more diverse and less monetary-supported school with lower average test scores. My sister blazed through the rest of high school with much success.

The reason I tell this story is because it is important to know your child and educate yourself and what school might be best. For example, locals often tout District 20 as one of the best, but I know there are families on the west side of town that have "choiced" out of D-20 into District 11 for certain special needs programs or accelerated learning programs. There are schools in almost every local district that have achieved the IB (International Baccalaureate) designation. There are small districts and large ones. There are areas with lots of money for schools and small ones with very little... or even privately funded charter schools and Christian or Catholic schools.There are schools that offer cooperative programs with home-school families. There are schools with an emphasis on the arts, math & science, reading/writing skills, and so much more. Colorado Springs is great in the ability to "choice" in and out of districts or schools based on your families' needs and it is amazing what you can do to maximize your student's learning potential. We went to at least 3 choice meetings and choiced into two different schools. We were on the waiting list for a charter school for about 2 1/2 years and ended up turning down our invitation there for our kindergartner because we didn't feel it was the best fit for him.

I guess what I'd like to ask you to do is educate yourself on what is best for your student(s) and make the best decision for your family. If you cannot visit in person or go to meetings because you are relocating from out of state, look up the local schools and get educated. If you don't know what they are, I'll happily provide a list of all the local school web sites. Your child's education is the foundation for their life, consider taking the time to help make the right decision for your child as they enter into this huge portion of their life!

I am working with some buyers who are considering a short sale for their purchase.  A short sale is a pre-foreclosure, where the seller cannot make his house payments and is headed toward foreclosure.  He advertises the home for sale hoping that a buyer will come along and purchase it before it actually goes to foreclosure.  Once an offer is made, he will take that offer to his lender and ask if the lender will accept a pay-off SHORT of what he actually owes.  Hence the term "short" sale. 

The challenge with these is lenders don't always accept that short payoff.  And they may not settle on the price he has advertised it for.   I've seen instances where the list price is $150,000 but the bank insists on a price of $160,000.  Sad for the buyers who only qualify for the lower amount and then have their hearts broken upon learning that they cannot have it at the asking price.

Another challenge with these is the time it takes to close.  It is not uncommon for a short sale to take 6-12 months to acutally close.  Why, because so much time is needed for negotiations with the lender, oftentimes who is out of state.

It's not that these can't work, but you really put yourself and your Realtor through some brain damage trying to make them work. Buyers beware!

Good news...Active duty military/first time home buyers may still be eligible for the $6,500 tax credit.  If you are buying your first home and were active duty military who served outside the U.S. between December 31, 2008 and May 01, 2010 this credit may apply to you.  Originally, first time home buyers had to be under contract before April 30, 2010 in order to obtain the credit.  But there is a one year extension being offered.

The FTHTC is extended an additional year to purchases before May 1, 2011 (for an individual entering into a written binding contract before May 1, 2011, and closing before October 1, 2011) for a taxpayer on qualified official extended duty as a member of the uniformed services, the Foreign Service of the U.S., or an employee of the intelligence community [IRC Sec. 36(f)(4)(E)]. The extension is available for individuals serving outside the U.S. for at least 90 days during the period beginning December 31, 2008, and ending before May 1, 2010.

In general. The term “qualified official extended duty” means any extended duty while serving at a duty station which is at least 50 miles from such property or while residing under Government orders in Government quarters.

This credit will expire in 18 days.  It's not too late!

Recently MSNBC posted an article about Colorado Springs and how our assessed values have changed with our slight market downturn. This is a very confusing subject, so I hope to clear the air. Unfortunately the link to the MSNBC article is "broken" or I would post it here to help clear some the confusion.

As we all know the home values in our area (some neighborhoods more than others!) have decreased in value since 2005/2006. I think most of us feel very fortunate that "the bottom hasn't fallen out" in the Pike's Peak region as it has in some cities/states where values decreased 50%. Basically the above referenced article spoke to the amount of taxes being collected by our county will decrease because as values have decreased slightly, homeowners have petitioned to have their tax value decreased to match their market value. Based on the assessed value x their mill levy (% of value paid for taxes), the amount of taxes paid decreases. In our area, normally the assessed value is lower than the market value... usually a considerable amount. Of course homeowners don't complain about that, petitioning to increase their assessed values to match their increased market value, ha! Anyway, this article caused some confusion. A client asked me if we expected to see a blanket price decrease across El Paso county... and she expected to see a 10-15% decrease across the board. I was shocked. I read the article, then read it again, realizing that the taxes had gone down as a result of the market decrease over the past 3-5 years, NOT the reverse. Our market values, listed home prices and sales are not all going to drop their prices because of the tax assessed value decreases. Expectations are for values to continue to increase, as we have already experienced over the past few months.

So all that to say, that in the opinion of real estate professionals... in this group I include Realtors, appraisers, and lenders, the assessed value has no determination of market value. When the market is "normal" assessed values only get reviewed every 3 years. So needless to say the assessed value is not updated enough to be an accurate review of market value. Realtors, appraisers, lenders and buyer's should use recent homes sales to determine market value. The truth is market value is what a buyer is willing to pay for a property. Real estate professional have adopted a method used by appraisers to find market value of existing homes. We look at comparable homes (similar size, age, style area, beds, baths, etc). We certainly look at available homes, aka "the competition", but the best comparables are those sold in the past 6 months or less. These comparables are easiest to find in most of our "cookie cutter" neighborhoods, but in more unique areas or styles of homes we have to expand searches by expanding search area, size/age of homes, etc to help. This technique is used both when we list a property, to price it right from the start and not "chase the market down" to the right price... AND when we are assisting a buyer in writing an educated offer on the home they have selected.

If you have a question about the value of your home, or are looking to buy a home and are just a little worried about how this all works, contact us, we'd love to help you!!

This week some clients of mine called and said they are considering backing out of their purchase contract.  They have concerns about future income and how that new house payment will feel down the road.

We Realtors are natural problem solvers.  Give us a challenge or an obstacle, and we are superb at fixing it and overcoming the issue.  And while I believe there is value in our ability to do so, I also believe that if all we do is solve problems and fix things, we are not completely serving our clients.

Listening and empathy are also essential to being a good agent.  While problem solving is always valuable, if we don't listen to the needs of the client, we are not really helping them.  So often I meet folks who tell me that other Realtors didn't listen.  "They didn't care what was important to us.  Their agenda, their paycheck was all that mattered."

Of course I'd like for this transaction to close.  Of course I'd like a successful outcome, and yah it would be great to get paid.  But that's MY agenda, and perhaps that isn't the best thing for these clients right now. I am going to remember that as we approach this dilemma. For my job is to serve, and that is what I do best!