Despite inventory shortages, homebuyers looking for bargains this winter

inman news... Prospective homebuyers hoping to buy a home in the next four months say the lack of inventory is their biggest challenge, but many believe winter is a good time to buy because sellers are motivated to sell and more willing to negotiate. That’s according to a survey of more than 1,300 visitors to realtor.com conducted from Nov. 7-16, which found 45 percent of buyers in the market said there’s not enough inventory in their price range. The survey also found that a surprising number of prospective homebuyers — 19 percent — are planning to do all-cash deals. Of those planning to buy without taking out a mortgage: 29 percent said they are downsizing to a smaller or less expensive home. 26 percent are relocation buyers. 11 percent are moving up to a bigger or more expensive home. 11 percent are buying a vacation home. But most of those surveyed said they’ll need a mortgage to finance their home purchase. Among that group, most did not have the 20 percent down payment that would allow them to qualify them for a conventional loan backed by Fannie Mae or Freddie Mac without having to also purchase mortgage insurance. More than 1 in 10 of those surveyed (13 percent) said they were planning to put just 3.5 percent down (the minimum down payment on FHA-guaranteed loans). Only 22 percent said they’d be able to make a down payment of more than 20 percent, which would allow them to avoid purchasing mortgage insurance. The reasons most often cited for buying a home in winter were: 26 percent said they believe that sellers are more motivated to sell and willing to negotiate. 24 percent indicated that they think home prices will be better. 24 percent revealed that they were unable to buy a house during spring or summer. 20 percent shared that they think there will be less competition between buyers. “This summer and spring homebuying season was particularly challenging for buyers, especially first-time homebuyers trying to compete with all-cash offers and bidding wars because of reduced inventory,” said Alison Schwartz, vice president of corporate communications at realtor.com, in a statement. “In fact, a quarter of the winter homebuyers revealed they are in the market now because they were unable to find a home during this last homebuying season.” While 28 percent said they were planning to buy because they are relocating, 19 percent were existing homewoners downsizing to a smaller or less expensive home, and 15 percent were move-up buyers. Nearly 1 in 5 of those surveyed (19 percent) said they were first-time homebuyers. Tight inventories and rising home prices continued to hamper home purchases, with sales falling for the second month in a row in October, the National Association of Realtors reported today. There were 2.13 million existing homes for sale at the end of October, NAR said, down 1.8 percent from September. But at October’s slower pace of sales, it would take five months for all those homes to sell, up from 4.9 months in September. Housing analysts generally consider a six-month supply of existing homes for sale as an even matchup of supply and demand — anything less can indicate that demand has outstripped supply. Although there continue to be “significant supply shortages,” inventories are “stabilizing” compared to the dramatic year-over-year declines seen earlier this year, realtor.com said Tuesday in releasing another report analyzing October listings data. NAR Chief Economist Lawrence Yun recently forecast that 2014 sales of existing homes will be flat due to factors including declining affordability, limited inventory and tight mortgage lending standards. Yun expects inventory shortages will continue into the spring buying season, which could keep a lid on sales. NAR is forecasting that when all the numbers are in, 2013 sales of existing homes will finish up 10 percent from last year, at 5.13 million. But similar gains aren’t expected next year — NAR predicts existing-home sales will hold steady at 5.12 million in 2014. -

Sex, drugs and alligators: Agents share bizarre open house encounters

an interesting article from inman news...ah the stories that real estate produces, not much ends up being surprising after awhile... Open houses and showings can hold unexpected surprises for real estate agents and their clients, as agents who shared their memorable open house stories with Inman News can attest. Alligator bonus room Jake Theoret, an agent with Re/Max of Grand Rapids (Mich.), helped buyers navigate a basement full of reptiles. Last winter I showed a beautifully restored farmhouse. It was staged to the nines! Think Ralph Lauren. Everything was prefect till we went into the utility room in the basement. The following animals were in various cages and crates: two alligators, two huge tortoises, two pythons, and numerous smaller reptiles. Thankfully, my client did not get injured in exiting the home. As soon as I got back to the office and researched the owner, I found out he was a reptile zoologist of some sort. Drugs, lice, hanky-panky Hugo Torres, general manager of Monrovia, Calif.-based Century 21 Adams & Barnes, says that in various showings over the years, he’s encountered illegal drug use, hungry lice, and a couple getting busy. Years ago while showing a property, I opened the door to a room and saw a younger man snorting drugs. Needless to say, the police were called. Years ago while showing property on a home, my client noticed these little moving dots on my tan jacket. Needless to say, delousing was involved. Some time ago I walked by a couple involved in some fun on their couch as we passed the window to their living room. No one was called … we simply returned 10 minutes later. (Hey that’s the average right?) Ask Realtor for key to restroom Nicki Moss, an agent with Keller Williams in St. Louis, found out why the young parents slipped in the open house. It wasn’t because they were interested in buying the home! I was a new agent and was holding open a $1.5 million home, which made me nervous to begin with. Just as I was closing up a young couple came in with their daughter. The guy went in one direction and the woman and child in another (again making me a little nervous); then I heard someone upstairs and before I could ask if everything was OK, I heard the toilet flush. He came back downstairs and they left. I guess he really needed to go the bathroom!!! Picture it without the squatters Sam DeBord, managing broker of Seattle-based Coldwell Banker Danforth, recalls an encounter with open house vagrants. I took clients to a “vacant” home near Seattle. After seeing the furnace was on, I asked the clients to stay in the car. Upon discovering two young male squatters sleeping in different rooms, I was surprised at their suggestion that my buyers and I come through and tour, and they would just stay under the covers. We didn’t.

Denver officials look at new rules to limit residential parking permits in densely populated areas

parking is getting tougher in Denver, no news to Denver folks I'm sure... from Denver Post- Denver apartment dwellers applying for new residential parking permits may find them more difficult to obtain under new rules proposed by the Public Works Department. The city has long struggled with the reality of too many cars and too few parking spaces, especially in densely populated areas of the city such as Capitol Hill. Limiting the number of permits given to people moving into apartments with nine or more units has caused a stir, forcing the city to cancel a rule-making hearing last week and participate in a public meeting 6 p.m. Thursday at the Botanic Gardens to discuss the issue. "I just don't think they like renters," said Nancy Burke, vice president of government affairs for the Apartment Association of Metro Denver, who last week wrote a letter to Public Works manager Jose Cornejo. "Approximately 15,000 Denver citizens living in over 8,500 units will be impacted," she wrote. City officials say they are working on creative ways to address an increasingly difficult problem — an exploding city population and a limited number of parking spaces. They emphasize that no existing permits will be revoked, only people living in buildings with nine or more units applying for new permits will face increased scrutiny that will look at the parking in their area. Public Works officials say the changes have already been put in place and the new rule simply puts the practice into writing. Now, more than 20,000 residential parking permits are issued throughout the city; permits that are specific to the block where the resident lives and that allow people to park past the two-hour limit. "They do not guarantee a parking spot," said Matt Wager, director of traffic operations. On blocks filled with apartments, on-street parking is at a premium. And newer technology allows parking enforcers to quickly discern when someone is not parked in their assigned block. "It is a big headache," said Barry Zimmer, who lives in Capitol Hill and struggles to find a place to park every night. "I am looking to move and 90 percent of that is because of parking. If I get a spot on the street, then I don't want to move my car. I want to stay there a few days. I go out less, take cabs. It's all just because of parking." In December, the City Council passed a bill changing the parking system — allowing the city to come up with new parking permits for special circumstances or zones. The city also changed the permit duration, requiring renewal every year rather than every three years. And now officials are considering a future fee that would charge up to $40 a year for residential permits and up to $200 for new permits.

Public gets peek at study of Front Range high-speed rail line Tuesday

interesting idea.... from Denver Post-Recommendations for putting in a high speed rail line from Pueblo to Fort Collins will be revealed to the public next week in Golden. The Interregional Connectivity Study, in which Colorado Department of Transportation planners looked at linking Front Range communities via rail, began earlier this year. The study pinpointed several station locations. It also looked at: • Multiple high speed rail technologies currently used in the U.S., Europe and Asia. • A variety of alignments from each section of the study area, investigating impacts, design feasibility, benefits and technology. • Funding, including public and private financing options. • Travel demand and ridership, modeling and simulating potential ridership in the future based on current data trends, including future land use, employment, population and development. CDOT points out that the report only includes preliminary recommendations. The study will be unveiled at an open house at CDOT's Golden office, 425 Corporate Circle, on Tuesday, Nov. 19, from 5 p.m. to 7 p.m. A presentation and discussion begins at 5:30 p.m.

Slowdown in Home Prices No Reason to Panic?

from realtor.com.... Though home prices have risen nearly 12 percent from a year ago, a slowdown is expected soon. But many analysts say it’s no cause for concern. “Prices are still going to rise — just not as at brisk a pace as we’ve seen over the past year,” The Wall Street Journal reports. “This should calm down those pundits who have fretted over a new crop of housing bubbles.” According to a report by Goldman Sachs economists, home prices will likely moderate because they have returned to “fair value” and are no longer being viewed as “undervalued,” as they were for the past two years. Also, a rise in mortgage rates may cause some buyers to re-evaluate their options. For the first time this year, buyer traffic dropped below agents’ expectations, and “the next few months will be crucial to determining whether this is just a pause or something more,” the Goldman Sachs report notes. The report also notes that investors will likely slow their purchases as the number of foreclosures start to dry up. What’s more, the inventory of homes for sale is starting to loosen as more sellers look to put their homes on the market. Those sellers, in turn, will then be looking to purchase another home, so prices will still likely continue to rise until new-home construction catches up. “With the improving underlying housing demand driven by household formation and economic recovery, we think housing activity will remain on an upward trajectory, despite occasional ups and downs along the way,” says the Goldman report.

November Real Estate Trivia-What are the only 2 major cities that have surpassed their pre-recession high price levels for real estate values?

Nationwide, home prices rose 12.8 percent in August from the previous year in the 20 large metro areas followed by the Case-Shiller report.

Denver and Dallas are the only cities among the 20 that have surpassed their pre-recession high price levels for real estate values.

8 Questions to Help Resolve Your Rent or Buy Dilemma

good buying article from Realtor.com

The decision to buy a home, one of the biggest financial investments you’ll ever make, can be empowering and exciting.

While the 2013 National Housing Pulse Survey by the National Association of Realtors showed that 80 percent of consumers believe buying a home is a good financial decision, it’s not always easy to know when the time is right to take the leap.

Choosing to become a homeowner takes not only a financial commitment but also the emotional maturity to create a plan and a timeline that suits your lifestyle and your budget.

Here are some of the factors that should be part of your decision to rent or buy a home:

1. How Do Home Prices and Rents Compare in Your Community?

While it’s easy to compare rental prices, when you look at the cost of buying a home you need to include not only your mortgage principal and interest payments, but also homeowners insurance, property taxes and possibly a condominium or homeowner association fee. Sometimes it’s more costly to rent than to buy, particularly when mortgage rates are low. A rent-or-buy calculator can help with your evaluation. You should also look at the long-term wealth-building benefit of homeownership that comes with rising values and increasing your equity as you pay off your home loan. A 2010 Survey of Consumer Finances by the Federal Reserve showed that the median net worth for homeowners was 30 times higher than the median net worth of non-homeowners.

2. Are You Emotionally Ready To Buy A Home?

One of the benefits of renting an apartment is that you typically only commit to a lease for one year. If you’re buying a home, you’ll need to choose a neighborhood and a home where you want to live for the next several years while you recoup the cost of buying and build equity.

3. Do You Have a Five-Year Plan?

While no one knows with absolute certainty what will happen over the next five or 10 years, if your plans include switching careers or moving out of state, you’re probably better off renting. If you plan to start a family in the next few years, you should take that into consideration when developing a budget and choosing a home.

4. Are You Ready to Take Care of a Home?

Along with the joy of decorating your home and changing it to meet your needs, you need to budget at least 1 to 3 percent of the home price each year for repairs. Whether you can handle work yourself or need to hire contractors, you should be prepared for the time and expense of maintaining your property so that it can keep its value and avoid more costly repairs in the future.

5. Do You Have Any Savings?

While there are loan programs available to some borrowers with a down payment of 3.5 percent and sometimes less, you’ll need some cash for a deposit, a down payment, closing costs and an emergency fund when you buy a home.

6. What Does Your Credit Profile Look Like?

Request your free credit report at AnnualCreditReport.com to check for errors and any negative information on your report. For a small fee you can get your credit score. Lenders typically require a minimum credit score of 620 or 640 and higher for government-insured loan programs, but for the lowest mortgage rates you need a credit score of 740 or above.

7. What Can You Comfortably Afford to Spend on a Home?

You can have a free consultation with a mortgage lender to find out how much you can borrow to buy a home, but you should develop your own budget to determine how much you can spend on your housing payment while still being able to pay your other bills and save for the future.

8. Will Your Budget Accommodate the Type of Home You Want in Your Market?

You can do a quick search on realtor.com to see what properties are available in neighborhoods where you want to live, or consult a Realtor for a more in-depth consultation about your priorities and your local market. You may also want to take a homebuyer education class to learn more about the buying process.

Your answers to these questions and consultations with professionals such as a lender and a Realtor can help you make the right choice and determine if you’re ready to buy now or need to wait a little longer to become a homeowner.

How to Market Your Home for Maximum Exposure

good advice setting expectations on selling from Realtor.com

Once you’ve made the commitment to sell your home, chosen a Realtor to represent you, and established a list price, it’s time to work with your Realtor to market your property so it sells as quickly as possible. Your Realtor should share a marketing plan with you, but the more you know about the process of selling your home the easier it is to support your Realtor’s efforts.

 

Pre- Market Tips

The day your home goes on the market it should be in prime condition and priced right to attract the most potential buyers. While your Realtor can help you determine an appropriate price and can offer suggestions to make your home more appealing, your job is to put in the work to get your home pristine clean and to remove clutter and personalization. Buyers want to see a home where they can visualize themselves living. If buyers see an overstuffed closet, they’ll assume the home lacks storage space; and if your kitchen counters are cluttered, they’ll think the space is too small.

Provide your Realtor with tips about what you love best about your home and community that can be incorporated into your marketing materials.

Your Realtor can advise you on what you need to repair before putting your home on the market. You can also visit other homes that are for sale, or even local model homes for ideas on ways to present your home to potential buyers.

 

What to Expect From Your Realtor

Many Realtors have experience staging homes, or they can bring in a stager to rearrange your place. In addition, your Realtor should market your home in multiple ways:

• Research the market to identify potential buyers to target for direct mail,
• Reach out to other real estate brokers and agents who work with buyers in your price range,
• Take excellent photos or hire a professional photographer to showcase your home online with attractive pictures,
• List your home on the local MLS (Multiple Listing Service) and make sure it receives maximum exposure on multiple websites,
• Take a video of your home or produce a virtual tour with numerous photos so your home can be viewed in-depth by buyers looking online.

Once buyers begin visiting your home or contacting your Realtor, your agent should respond as quickly as possible to keep the momentum going. Every visitor to your home or their agent should be contacted by your Realtor to get feedback on your home and to gauge their interest.

 

What Your Realtor Should Expect From You

While your Realtor does the heavy lifting when it comes to marketing, as a seller you need to support your Realtor in several ways:

• Keep your home as clean, neat and odor-free as possible while your home is on the market. This may mean that you have to give up cooking your favorite liver-and-onions dish and that you have to bribe your kids to make their beds and take out the trash every day.
• Make your home as available as possible to buyers, no matter how inconvenient it is for you and your family. Your home won’t sell if no one can see it.
• Leave the house when buyers are there, since studies show that buyers will linger and look more carefully when the homeowners aren’t there.
• Lock up your pets or take them away when buyers are visiting, especially during an open house when multiple visitors are expected.
• Provide information to buyers about community amenities or neighborhood sports leagues so they can appreciate your home’s location.

If you and your Realtor develop a team approach to selling, you’ll benefit from a quicker and more pleasant real estate transaction.

Denver's housing market slows slightly in October

interesting Denver Post article...

 

Home sales in Denver were down in October compared to September but were still 13 percent higher than in October 2012, according to a report released Tuesday by Metrolist.

According to the report, 4,730 homes were sold in September compared to 4,628 in October, a decline of two percent.

However, the 4,730 homes sold in October were 13 percent more than the 4,095 homes sold in October of 2012.

The average sold price of new and existing homes was slightly lower in October - $303,836 - compared to $304,958 in September.

Average days on the market increased to 44 days, compared to September's 39 days.

Kirby Slunaker, CEO and president of Metrolist, said that although the market has slowed somewhat, sales, inventory level and average home prices have changed "very little from prior months, keeping the market nearly as competitive as the hot summer months.

"While the market has slowed down slightly as one would expect, the numbers are incredible," said Slunaker in a statement. "Increasing inventory spurred on by hot early season buying will continue to provide buyers with more and varied opportunities."

The slight changes indicate that home prices and strong sales will occur throughout the fall and winter months, said Metrolist.