Denver’s Seller’s Market Gains Strength

Welcome to the Real Estate Market Midyear Report! Here’s What We’re Seeing:

Average Home Price: The average price of a home in metro Denver leapt another 12 percent in the past 12 months. I believe 2015 will continue to play out very strong and here’s why: The number one driver of home price change is the amount of inventory on the market. Our market inventory continues to drop, down another 17 percent from this time last year for single-family homes (down 19 percent for condos and townhomes!). Until inventory comes back on the market there will continue to be tremendous upward pressure on prices as demand outstrips supply. Where will the new supply of home inventory come from? It won’t be bank-owned properties and shortsales. The metro Denver economy is strong and unemployment is low so there will be very few distressed properties on the market for the foreseeable future. The additional supply will eventually come from home owners who finally realize what a great market it is to sell and decide to put their home up for sale. When this will happen is anyone’s guess. We’ve seen very little evidence of home owners making this realization so far, as evidenced by the continued lack of inventory on the market. Sooner or later though inventory will begin to appear. That’s your sign of a changing market. But this might take several more years which is why prices will continue to rise strongly.

Number of Homes Sold: Because there of homes sold is actually going DOWN year over year, not up. There were 9 percent fewer homes sold in June, ’15 than June ’14 simply because there is no inventory to sell. It’s the very definition of a seller’s market.

The Condo/Townhome Market: Incredibly enough the condo market is doing even better than single-family homes! Prices are up 16 percent in the past year and inventory is down 19 percent creating a blistering hot market for attached homes. Just like for the single-family home market I don’t see any evidence this will change any time soon. Until more condo inventory comes on the market prices will continue to rise. Expect strong price increases for the next several years.

Denver Mid-Year Real Estate Snap Shot

Denver is still a great place to invest in real estate. The fix and flip market is strong for those who can find underpriced homes to buy and repair. They’re out there but it takes tools, patience, and work to find them. Once you get one fixed up, selling is the easy part because of the lack of competing inventory. The buy and hold market will continue to be extremely profitable for long-term investors. Interest rates and vacancy rates are still near record lows and rents continue to rise – a record 10.8 percent per year the past three years. It’s not difficult to buy a rental property in today’s environment and put it on the path to be paid off in 12-15 years. Just think how your life would change if you owned a couple of rental properties free and clear! For building long-term wealth it’s tough to compete with rental property ownership. That’s the one thing that will never change.

To learn more about what your home is worth, please contact me for a complementary confidential consultation! 303-807-3289

5 Short Sale Myths

Most people would rather share the intimate details of their sex life than reveal the embarrassing fact that they are facing foreclosure! Then they hope and pray and make themselves physically sick over their secret. When a miracle doesn’t arrive to save their home, they face foreclosure alone and ashamed. Sadly, this is all too common.

Never fear, there is hope. Below are a few of the common short sale myths:

Myth #1 – I Am All Alone. If you are in this situation right now, let me assure you that you are not alone. Our country has just gone through one of the worst housing crisis in history. And while the housing market has recently improved, there are many homes so significantly underwater that it will take decades to recover.

Myth #2 – I Don’t Know How to Handle My Finances. Poor lending practices and the recent housing bubble forced many homes “under water.” For example, if you purchased in 2005 (during the height of the bubble) it’s unlikely you can recover in the next ten years. The same if true if you refinanced at 125%. If you are in either of these situations, crunch the numbers. It is better to short sale now and start again with a fresh clean slate. You are NOT a bad provider. You are NOT a poor financial manager.

Myth #3 – I Will Be Forced to File Bankruptcy If I do a short sale. Not true. In MOST cases the banks are willing to forgive the deficiency (the difference between the net sold price and the amount owed) when you short sale your home. However, if you let your house go to foreclosure, you may very well be liable for the deficiency once your home is auctioned off.

Myth #4 – Everyone Will Know! “Short Sale!” will not be posted on the sign in your yard and I will handle the sale very discreetly. It will be listed in the Denver Metrolist as a short sale, but only for the purposes of finding buyers. Most of your friends and neighbors will only know if you tell them.

Myth #5 – I’ll Never Be Able to Buy Again! After a short sale, with recovered credit, most are able to buy in 2-3 years. Even more good news is that the Federal Housing Administration is working on reducing the amount of time a buyer must wait past foreclosure and/or bankruptcy. In some cases, with recovered credit, buyers are able to secure a loan 12 months past a financial event.

There is more to a short sale than signing a stack of papers and negotiating with the bank.  I will help guide you through the process as you emotionally distance yourself from your home. I will treat you with respect as you discuss the financial aspects of your sale and will be discreet in dealing with buyers and other Realtors ®. I can’t make it painless, but I promise help you make the transition as smoothly as possible.

Call me today for a confidential consultation.

Jan Parrish 303-807-3289