Still Amazingly Low Home Loan Rates
Okay, so I keep sharing this with people I speak to in person, but I guess it’s not getting through. The interest rates on home loan mortgages are still incredibly low.
Investor buyers are snapping up property very quickly. In fact, I’ve had a couple buyers who have had to make offers on multiple properties in order to make a purchase as the buyer competition is fierce.
Prices are low, which means a buyer’s market outside of Boulder, and of course Louisville, CO now that Money magazine rated it #1 again…
Boulder County Home Prices Up or Down?
If you believe what you read and hear in the media, you could conclude that home values are up, or down… really, everyone is reporting different data, and many times it’s to simply “sell papers”. I have a friend in the Newlands neighborhood who just contacted me this morning to tell me the county sent notice her property value had increased many thousands of dollars.
I think there’s something amiss here. Consensus among real estate professionals in Boulder is that even areas like the Mapleton Hill Neighborhood, Table Mesa Neighborhood, and the Old North Boulder Neighborhood are essentially even/flat and have been so for many months. A recent local news article reported that home values between mid 2008 and mid 2010 are down according the the Boulder County assessor.
If that’s so, then why have I had about 20 calls and emails from my friends and clients asking me if I can help them with their county real estate tax assessment? These calls are because my friends are concerned about paying higher taxes, based on higher values reported and assessed by the county.
So which is right?
Buying Bank Owned Property
Buying a bank owned home, sometimes labeled REO, is very different from buying a short sale, or “short pay” home.
A transaction on a home which is bank owned is usually much easier to manage, and a contract offer on a bank owned home is responded to more quickly than a property subject to a short sale/short pay.
The biggest problem with buying a bank owned home is not the paperwork, per se, but rather the home itself. Many times the home is in poor physical shape, but apparently some banks are taking steps to remedy this problem.
Automated Home Appraisals Unreliable
I remember last year I helped a seller market and manage the sales process of a penthouse condo in Boulder. We had two buyers, both wanting to make the purchase with cash (no loan), and one of them backed out.
This was a bit of a surprise since this buyer insisted they understood the market, and what a rare opportunity and great value this property was in the Boulder housing marketplace. This buyer’s discussion with an appraiser ‘friend’ gave them cold feet, and they lost trust in their own knowledge base and instincts.
It was no surprise to me that the second, “back-up” buyer, swooped in and made an offer the moment the first buyer backed out.
What was interesting was how divergent the appraisers were in their professional value opinion compared to everyone’s instinctive sense of the value. Even the two appraisers I spoke to expressed that they had a sense that the value of the property was at or above the price in the contract, but both said that the methodology they had to use to create a professional appraisal wouldn’t allow them to get the price as high as the contract price.
A recent Wall Street Journal corroborates this dilemma.
Colorado Growth Rate 9th Fastest in US
According to the latest preliminary US census data released this Tuesday, Colorado is the ninth-fastest growing state.
This covers the period from the years 2000 through 2010 both based on population increase (an additional 727,935 residents), and percentage increase (16.92 %).
This hardly compares to the massive influx of new residents during the boom-time of the 1990′s when the growth rate was more than 30%, with over 1 million new transplants to Colorado.
There’s reason again for optimism that we’re entering into a strong and robust growth pattern. I’m seeing ever increasing activity in the real estate and job market. When talking to the owner / broker of our RE/MAX office the other day, he shared statistics that we’re already out pacing the sales volume at this time this year, compared to this time last year. That’s significant because last year the tax incentives for real estate purchases were driving a lot of activity in the market. There are no incentives in place currently, but still lots of activity.
