Parker New Homes vs Foreclosure Properties
So I get to meet a new client that is in a relocation from California today and set up to see about seven properties to get a feel for areas and price ranges. He works in Inverness near DTC so we decided to stay within a 10 minute drive to the office. He wants to stay under the 300K range and isn’t looking for anything too big so I chose a few neighborhoods that would work. We had never met before so we started at a neighborhood closest to his office.
Walnut Hills and Willow Creek in Cherry Creek School District
Our first stop was in Walnut Hills where the homes were built in the 1960′s and 70′s and range from 170K to 280K. There are many bi-level, ranch and tri-level homes in this area. The lot sizes are pretty big Read the rest of this entry »
Great news for Real Estate in Highlands Ranch and Lone Tree so far this year. In 2009 there were 110 closed sales from January to February. So far in January and February we have had 167 closed sales in the same time frame according to information in Metrolist. ( A Multiple Listing Service – MLS in the Denver Metro Area ) There are several factors that have contributed to the rapid increase in closed sales. The historically low interest rates combined with government incentives for first time home buyers and move up buyers has helped people get off the fence and into a home. We have also had a relatively mild winter as far as snow goes which makes it easy for us to get out and look at homes.
The Average Sale Price Increased 8.9% over February 2009
Not only were there more sales in the area, but the average sale price also had an upward trend. In 2010 the average sale price was $334,635 compared to $307,185 in February of 2009. One month does not make up a whole year Read the rest of this entry »
First of all, why would a marijuana grower in a residential neighborhood with tons of covenants go on television and brag about making 400K a year growing pot in his basement? Was he high? Really? Now that I have that off my chest, how will this effect real estate values? The media hype and flash will subside and I doubt there will be any lasting effect on home values except for the homes really close to the property. The house will be labeled ” The Pot House” and it will stigmatize the house and possibly those next door to it. Some people aren’t going to care but believe me there are some who will. If I were the neighbor, I’d be pretty upset at Bartkowicz.
NIMBY is a term that most of us are familiar with. ( Not In My Back Yard )
Highlands Ranch Community Association sent me the following email
Reported Marijuana Growing Operation in Highlands Ranch
9News is reporting that there is a medical marijuana growing operation in Highlands Ranch. Read the rest of this entry »
Nicolo’s Pizza Is The Best in Highlands Ranch
My family and I were in the mood for pizza the other night and decided to check out Nicolo’s Pizza in Highlands Ranch 303-791-9800. We had a great time and so I thought I’d take a break from writing only about Real Estate and tell you about the experience. It was a Friday night and we had our family of five plus our son’s friend Elliott who might as well live with us. The place was busy but there was no waiting so we were seated pretty fast. They asked for our drinks and brought out some rolls.
A Pizza Place that you can sit down and eat at.
Many of the quick pizza chain places are fine for take out, but I like to be able to sit in a restaurant and get served. The atmosphere was good and comfortable for our family, not too loud. Like I said earlier, they brought out drinks and bread within a few minutes of getting there. We ordered a cheese pizza Read the rest of this entry »
Denver Home Sellers Restricted on Buyer Credits
Beginning this summer, new FHA regulations will reduce allowable seller concessions from 6% to 3% according to a recent announcement from US Department of Housing and Urban Development. Every new regulation that comes out is designed to protect consumers in some way. This new policy will be put in place to restrict inflating property values in order to pad the purchase price with lending fees, closing costs and repairs. The less desirable effect of this policy change will effect Denver home sellers as well as home buyers if there is a need to give a credit to the buyer for home repairs that the seller cannot complete prior to closing.
3% Seller Credit Used to Pay Buyer Closing Costs
FHA loans require that a buyer have 3.5% down payment ( rumored to be increasing to 5% some time this summer ) in order to get an FHA loan. Many home buyers have to save and scrape together just enough for that down payment. Since much of their money goes towards the down payment, they do not have and extra 3% to pay for closing costs, escrows, insurance, pre-paid interest, and appraisals so they ask the seller to contribute that money on their behalf. Many sellers agree to these terms because they understand that the buyer for their home doesn’t have the additional funds and if they did not make those contributions, the buyer would not be able to purchase the home.
And Then Comes the Dreaded Inspection
Imagine that the full 3% seller concession has to be used for closing costs etc. Now imagine that a few items show up on the home inspection that require repairs. On FHA loans, the FHA appraiser also inspects the home to make sure that the property is FHA insurable. Lets pretend that an independent inspector that is hired by the buyer finds repairs that should be made totaling $2,000. In the past, the seller could credit $2,000 to the buyer at closing for the repairs and the buyer did the work after closing. That type of credit will quickly become a thing of the past for many real estate transactions. The transaction would no longer be in compliance with the new policy because seller concessions exceed 3%.
There is Risk for Sellers Who Make Repairs
Many sellers prefer to give buyers a credit at closing for repairs instead of fixing the problem or perceived problem. They prefer that because there is risk in doing the repairs. Have you ever heard of a real estate closing that didn’t happen? In my 17 years of selling real estate I can assure you that financing can fall apart the day of the closing. The sellers may have spent money to complete repairs needed to close the deal only to end up empty handed at the closing. Just to complicate things even more, what if the transaction is a short sale and the seller doesn’t have any money to do the repairs? How would you comply with the policy and get the repairs done?
Creative Solutions Required to Navigate the New FHA Policy
This policy isn’t even in place yet, but the announcement will be made in February. I am looking for ideas from lenders, Realtors and others in the industry to address this issue that will effect real estate transactions in Denver this summer. One idea that I have is to have a check cut to the contractor at closing from the sellers proceeds. The credit to the contractor would be in compliance because it is on the HUD and disclosed to all parties. The buyer would hold on to the check until the work is complete. The only problem that I see is that a red flag will go up for the lender asking what that credit to the contractor is for. One thing to be sure of, expect delays during the next few months while everyone figures out what they can do and not do.