Denver Colorado Real Estate

* Just Reduced Another $10,000 - Now $204,900 * Great Starter in Highlands Ranch *

New Price - Reduced $29,000!!! - Now $204,900. New roof  September 2011.  Brand new gutted kitchen with new stainless appliances including a built-in microwave.  Also, a new solid surface countertop and new maple cabinets w/ pull-out drawers.  New 3/4" brazilian oak hardwood floors thru-out main floor.  3 bedroom, 3 bathroom home. Kitchen is open to family room.  Nice, relaxing yard.  Quiet street with minimal traffic.  Access to all 4 Highlands Ranch recreation centers.  New carpet and much more.

 

www.549Arden.com

 

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Sean Patrick Reilly

Cherry Creek Properties

303.520.8700

The New Real Estate Boom?

From an Opinion piece at Inman News:

Home prices and sales may be flat, but the rental industry is booming. The percentage of renters is on the rise, the number of households is increasing, and more Americans are downsizing, all of which point in a single direction: rents are on the rise.

At the peak of the housing boom, homeownership in America reached an all-time high at 69.2 percent. Today that number has plummeted to fewer than 67 percent, which may not sound like a huge drop, but that represents roughly 3 million households that were owner-occupied and are now tenant-occupied.

The high foreclosure rate has accelerated the transition toward leasing, but there are a myriad of other trends coalescing to boost demand for rental housing.

Read the entire article here.

This trend is true in the Metro Denver Real Estate Market as well.  There seems to be a plethora of investors out there with cash to spend on low to moderately priced homes in just about all pockets of the metro area.  With banks pricing many of their homes so well, it creates a bidding war on homes that you wouldn't expect in this depressed market.  But, it is happening and on a regular basis.  Some of these homes are turnkey and others need in the ballpark of $10-$20,000 to fix up and make rentable.  The upside of all this for investors is that they are seeing $300-$500 month profits on homes with 80% LTV.  The unfortuate side effect here is that potential first time home buyers looking for a bargain are now competing w/ cash investors, or extremely well qualified investors.  I don't see this ending anytime soon and with market being beaten up as they have been and interest rates at/near historic lows, payments on these homes haven't been lower in years.  Start your search for an investment property here and then give me a call at 303.520.8700 with any questions.

August Existing-Home Sales Leap Despite Headwinds

From Realtor Magazine:

Existing-home sales increased in August, even with ongoing tight credit and appraisal problems, along with regional disruptions created by Hurricane Irene, according to the NATIONAL ASSOCIATION OF REALTORS®. Monthly gains were seen in all regions.

Total existing-home sales, which are completed transactions that include single-family, townhomes, condominiums and co-ops, rose 7.7 percent to a seasonally adjusted annual rate of 5.03 million in August from an upwardly revised 4.67 million in July, and are 18.6 percent higher than the 4.24 million unit level in August 2010.

Lawrence Yun, NAR chief economist, said there are some positive market fundamentals. “Some of the improvement in August may result from sales that were delayed in preceding months, but favorable affordability conditions and rising rents are underlying motivations,” he said. “Investors were more active in absorbing foreclosed properties. In additional to bargain hunting, some investors are in the market to hedge against higher inflation.”

Investors accounted for 22 percent of purchase activity in August, up from 18 percent in July and 21 percent in August 2010. First-time buyers purchased 32 percent of homes in August, unchanged from July; they were 31 percent in August 2010.

Read the entire article here.

So, with all the bad news out there, we finally get a nationwide flurry of activity in the residential real estate market.  I do like that, but I need to see some follow through.  And now that we are heading into the fall months, I am not certain that we will see that - I do hope I'm wrong.  Properties do sell and sometimes there is a flurry at the end of the year, but nothing has really changed in the economy.  Mortgages are still tough to get regardless of how low the rates are and that just makes buying / selling of homes that much tougher.  Investors still remain out there in full force and are scooping up properties at bargain basement prices.  It's good to see a decent amount of first time buyers hit the market as real estate has historically been a great investment - it just may take a little longer to start realizing decent appreciation, but you need a place to live, right?  So, like I said, I like this, but really need to see some follow through before I start to jump on any bandwagons.  There are great deals out there still and I don't see that going away anytime soon.  Thinking about buying - start here.

Interest Rates Reach New Record-Lows Again

From Realtor Magazine:

For the second straight week, mortgage rates reached another milestone, with 30-year and 15-year fixed-rate mortgages hitting record lows again, Freddie Mac reports in its weekly mortgage market survey.

"Continued investor concerns over the state of the European debt markets kept U.S. Treasury bond yields low and allowed mortgage rates to ease once more this week,” says Frank Nothaft, Freddie Mac’s chief economist.

For example, home owners who refinanced at today’s 30-year fixed-mortgage rate could trim nearly $1,715 a year in interest payments on a $200,000 loan, Nothaft says.

Here’s a closer look at rates for the week ending Sept. 15.

30-year fixed-rate mortgages: averaged 4.09 percent this week, down from last week’s previous record of 4.12 percent. Last year at this time, 30-year rates averaged 4.37 percent.

15-year fixed-rate mortgages: averaged 3.30 percent, dropping from last week’s record low of 3.33 percent. Last year at this time, 15-year rates averaged 3.82 percent.

5-year adjustable-rate mortgages: averaged 2.99 percent this week, up slightly from last week’s 2.96 percent average. A year ago at this time, the 5-year ARM averaged 3.55 percent.

1-year ARMs: averaged 2.81 percent, down from last week’s 2.84 percent average. A year ago, the 1-year ARM averaged 3.40 percent.

By REALTOR® Magazine Daily News

One would expect that the refinancing world would be on fire at these rates, but even though business is up, we are not seeing record setting refinances.  Mortgage standards need to be relaxed a bit to allow people who are being left out to refinance.  It's just my two cents, but if people were able to save money on their mortgage and others were able to buy homes, this economy would be in a lot better position than it is right now.

The Week in Review (Ending September 16, 2011)

From Fidelity National Title:

The Week in Review

MONDAY, September 12th
The focus this week will be on inflation figures for August. Higher inflation of course erodes the return on Treasuries usually resulting in lower prices and higher yields. It will also be worth noting if the Fed has to contend with rising inflation at next week's policy setting session; if so, it would likely forestall another round of quantitative easing.

TUESDAY, September 13th
The government ran a budget deficit of $134.2 billion in August compared with a budget shortfall of $90.5 billion in August 2010. Calendar effects increased outlays by 19.2% last month. Receipts were up by 3.2% from their year ago level. Fiscal year to date the cumulative budget deficit totaled $1.234 trillion vs. a budget deficit of $1.260 trillion for the same period last year. With one month to go in this fiscal year, it looks like the deficit will total about $1.3 trillion roughly in line with FY2010.

WEDNESDAY, September 14th
The MBA mortgage applications index rose 6.3% to 638.7% for the week ending September 9. The purchase index increased 7.0% last week but remains down 7.0% on the year. The refinance index was up 6.0% on the week but is 23.5% lower than its year ago level. The gain in the index last week was probably related to another drop in rates. Contract mortgage rates fell with the 30-year fixed down 6 bps to 4.17%. Even with the gains last week, mortgage application activity remains relatively subdued.

Retail sales were unchanged in August less than an expected gain of 0.2%. Retail sales are now 7.2% above their year ago level but have slowed dramatically in recent months as spending appears to have hit a wall. Weakness was broad based across most categories except for an anomalous 2.4% sales gain at sporting goods and hobby stores. Consumer spending hit a soft patch in April and has yet to emerge from it. Although spending is not robust, consumers do continue to spend and provide modest support to the overall economy.

The producer price index was unchanged in August as food prices rose 1.1% and energy prices declined 1.0%. Excluding food and energy prices from the index the core PPI was up 0.1% on the week with a 2.5% gain on the year. Core producer inflation, while still within a moderate range, has been trending higher in the last year or two as higher costs at earlier stages of production are passed through to finished goods.

THURSDAY, September 15th
Jobless claims rose 1k to 428k for the week ending September 10. The data may have been impacted and could be impacted in coming weeks by the effects of Hurricane Irene. Regardless, the level of claims at just over 400k suggests that the pace of layoffs may have slowed since last year but that there is little new hiring going on. Labor market conditions remain stagnant.

The consumer price index jumped 0.4% in August, higher than an expected 0.2% gain. Price gains were seen for food, shelter, gasoline and apparel. Excluding food and energy prices, the core CPI was up 0.2% on the month and gained 2.0% on the year. Price gains have been persistent recently but are expected to ease in coming months as commodity or input prices soften in response to a weakened economy.

FRIDAY, September 16th
After tumbling 8 points in August in the aftermath of the debt ceiling debate in Washington, consumer sentiment rose 2.1points in early September to a reading of 57.8%. The gain came entirely from better current conditions assessments. Expectations slipped by less than a point. It was a small bounce however it does imply that consumers are resilient and feeling a bit better about the economy.

I keep looking for a glimmer of hope in this economy, but I just don't see it.  Something has to be done that will get people to hire again.  More people working equals more people spending, but this is just not happening.  Also, something needs to be done to help people refinance.  With rates as low as they are (literally, we've had historic lows a couple times recently), the mortgage applications should be way up.  If hundreds of thousands of people can save $200+ per month, how much extra money would they have to spend?  Right now, lending standards are so stringent that people who are easily worthy of refinancing are being denied.  Also, people who would like to buy homes can't due to not being able to get a loan.  I am not saying that we need to go back to the "if you had a pulse, you could get a loan" days, but standards need to be eased if we are going to get this economy rolling again.  The bottom line is that we are trudging at the bottom and I really hope that bottom does not fall out from underneath us.

The Week in Review (Ending September 09, 2011)

From Fidelity National Title:

The Week in Review

MONDAY, September 5th
LABOR DAY
All Markets Closed

TUESDAY, September 6th
The ISM non-manufacturing index increased to 53.3% in August from a reading of 52.7% in July. The gain was led by a modest uptick in new orders and suggests continued, moderate expansion in the service sectors of the economy. Details in the data showed a decline in employment which is consistent with weakness in the broader economy. Business activity in the service industries remains soft but does not raise any warning flags of recession at this time.

WEDNESDAY, September 7th
The MBA mortgage applications index fell 4.9% to 601.0% for the week ending September 2. The index has declined by 16.1% over the past three weeks and is now 31.7% below its year ago level. The purchase index edged 0.2% higher on the week but remains 13.5% lower than its year ago level. The refinance index dropped 6.3% last week and remains 35.7% below its year ago level despite lower rates. Contract mortgage rates fell again in the past week with the 30-year fixed down 9 bps to 4.23%. Application activity remains range-bound and weak amid slow economic conditions, stagnant labor market activity and lack of confidence anything is going to change for the better anytime soon.

The Fed's round up of economic activity in the 12 Federal Reserve Banking Districts, known as the beige book showed modest economic activity in most districts with some noting mixed or weakened activity from mid-July through August. Economic conditions were disrupted in part by Hurricane Irene in late August and characterized as mostly stable but weak. Recent economic data such as last week's disappointing employment report were not taken into account when this survey was compiled suggesting perhaps a more positive tone than would have been otherwise. The September 20-21 FOMC meeting takes on added importance at this juncture to more fully understand the Fed's outlook, given more recent information and what actions if any the FOMC decides to take.

THURSDAY, September 8th
Jobless claims rose 2k to 414k for the week ending September 3. After averaging 459k per week in 2010, initial claims have averaged 415k a week this year, a clear indication that the pace of layoffs has slowed over the last year. Weakness in the labor market is due to lack of hiring as opposed to high job losses. The aftermath of the recent hurricane on the East Coast will likely drive unemployment claims higher over the next several weeks or more, pushing labor market improvement even farther down the road.

The international trade deficit on goods and services narrowed in July to $44.8 billion from a trade gap of $51.6 billion in June. The improvement in the trade picture was a result of a 3.6% gain in exports. Imports slipped 0.2% on the month. If net exports maintain gains through the end of this quarter, they will contribute positively to third quarter economic growth.

Consumer credit outstanding rose by $12.0 billion in July led by a surge in non-revolving credit balances. Non-revolving credit including car loans increased by $15.4 billion as revolving credit balances mainly in the form of credit cards fell $3.4 billion. Household deleveraging continues as consumer move toward improving their debt to income ratio during tough economic times.

FRIDAY, September 9th
No news.

Not terrible this week, but the jobless claims still seems to be hanging on above 400,000.  This is a number that I belive needs to drop and then stay down.  This economy will get better, but only when there are jobs out there for people.  It is just my opinion, but if people have jobs and feel like those jobs are not going to go away, then they will spend and spending will get the economy going again.  Spending from people, not band-aid spending from the government.  At least we seem to be somewhat stable down here, but who knows if the other shoe is going to drop, or if we are going to start clawing out of the basement.  I'd love to see this country start clawing out of the basement sooner rather than later, but I just don't see any indication of that at this point.

The Week in Review (Ending September 02, 2011)

From Fidelity National Title:

The Week in Review

MONDAY, August 29th
The pending home sales index fell 1.3% in July to 89.7%. This follows a cumulative 10.7% increase in May and June. Additionally, pending sales are 14.4% above their year ago level but remain 29.4% below their peak in April 2005. Pending home sales are counted when the sales contract is signed; thus, this report suggests home resales are likely to be somewhat weaker in August and September.

Personal income rose 0.3% in July and is up 5.3% over the past year. Consumer spending rose 0.8% on the month which was better than an expected 0.4% gain, and is now 5.1% higher than its year ago level. Income growth combined with pent-up demand supported spending last month however, stronger job creation will be needed to support income growth going forward.

TUESDAY, August 30th
The S&P/Case-Shiller 20-city home price index fell 0.1% in June from May and is now 4.5% below its year ago level. In all 20 cities, home prices declined on a year-over-year basis however, the rate of decline was slower in 14 of the 20 areas tracked. Minneapolis had the largest annual decline at 10.9% while Washington D.C. had the smallest annual decrease at 1.2%. Nationwide, home prices are down 31.8% from their April 2006 peak, similar to what they were in June 2003.

Consumers are really feeling it; the Conference Board's survey of consumer confidence plunged 14.7 points in August to a level of 44.5%. This was the largest monthly decline since October 2008 during the financial crisis and confidence is now well below its average recessionary level. The decline was led by a huge drop of 23 points in the expectations index. Clearly, consumers are worried about the direction of the economy and jobs.

WEDNESDAY, August 31st
The MBA mortgage applications index fell 9.6% to 631.7% for the week ending August 26. The purchase index climbed 0.9% higher on the week while the refinance index tumbled 12.2%. Slower refinancing activity is surprising given another drop in contract mortgage rate. The 30-year fixed rate fell another 7 bps in the past week to 4.32%. Mortgage activity remains stuck within the same range it has been in for the past 2 years which suggests that the housing market recovery has yet to begin in earnest.

THURSDAY, September 1st
Jobless claims fell 12k to 409k for the week ending August 27. Claims have been hovering at or just above the 400k level for the last 21 weeks. While it is an improvement over the average weekly claims level in 2010, the lack of movement and protracted elevated level suggests stagnant labor market conditions.

The ISM manufacturing index fell to 50.6% in August from a level of 50.9% in July. At just over the 50% level, the index reading suggests slow, but still expanding activity in the manufacturing sector. Manufacturing activity has decelerated sharply over the past six months under weak final demand mostly, though supply chain disruptions also detracted during that time. The outlook is for weakness in the sector to continue until economic growth can be revived which would then stimulate new orders, production and employment.

FRIDAY, September 2nd
There were no new net job gains in August as a 17k payroll increase in the private sector was offset by a 17k decline in government positions. The goose egg was much weaker than even recently lowered estimates for August job gains of 50k to 75k. Moreover, revisions in the prior two months resulted in 58k fewer jobs created during that timeframe. Separately, the unemployment rate was unchanged at 9.1%. Improvement in the job market ground to a halt last month as continued uncertainty regarding the economy weighed heavily on businesses, large and small. Private sector employment growth is anemic and not sufficient at this time to lower the unemployment rate or drive economic growth. Consequently, economists have downgraded the jobs outlook with only modest payroll gains expected for a year or more.

The same story week after week.  Jobs are the key and by the looks of the data above, there are no new jobs and people are still losing their jobs at a rapid pace.  Something needs to be done to get this train rolling in the  right direction.  I know we are going to hear another speech this coming Thursday about how we can create more jobs, but we need to give a reason to business owners to hire and keep people, not just throwing money at a problem for short term bump.  I'm hopeful that there is going to be more to the speech, but I'm not holding my breath.

Interesting Slide Show - Homes of the Future

From CNBC:

Click this link to see some of the more intriguing homes of the future.

* Just Reduced Another $10,000 - Now $319,900 * Spacious, Open, Custom Home *

 
Reduced $20,000!!!!  Spacious home in quiet neighborhood.  3,660 total finished square feet. 4 bed, 4 bath.  Soaring vaults.  New carpet and tile thru-out.  Clean, move-in ready.  Walk out onto deck on 4 different levels.   Loads of natural light.

www.2557jellison.com

 

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Sean Patrick Reilly

Cherry Creek Properties

303.520.8700