CSREJ - October

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Vol. 11 No.2

CAR: Vote Realtor Party on Nov. 6 SEVERAL STATEWIDE INITIATIVES MAKE FOR A COMPLEX BALLOT – THE COLORADO ASSOCIATION OF REALTORS IS PROVIDING THE FOLLOWING INFORMATION TO HELP YOU DECIDE:

Sellers brace for stiffer competition as buyers retreat

A shift is occurring in many housing markets. Affordability may be prompting more potential buyers to pause due to rising mortgage rates over the last few weeks, and home sellers are now facing more competition. Homeowners may no longer be able to expect the quick sale they’ve seen their neighbors get in the past.

The number of For Sale signs is starting to increase across the country. Unsold inventory is at a 4.4-month supply at the current Vote YES sales pace. Inventories were at 1.88 million in September, up slightly Amendments Y and Z Congressional & Legislative Redistricting from 1.86 million a year ago, acVote NO cording to the National Association of REALTORS®’ latest housing reAmendment 73 port, released Friday.

Funding for Public Schools Vote NO “There is a clear shift in the market with another month of rising Amendment 74 inventory on a year-over-year basis, The “Takings” Initiative though seasonal factors are leading Vote YES to a third straight month of declinProposition 110 ing inventory,” says Lawrence Yun, Let’s Go Colorado NAR’s chief economist. “Homes Vote NO will take a bit longer to sell comProposition 112 pared to the super-heated fast pace Setback Requirement for Oil and Gas that we saw earlier this year.”

See the reasoning behind each stance Existing-home sales declined in at www.coloradorealtors.com September, with all four major re-

In the case of statewide ballot initiatives, we’re dedicated to giving you information on the critical issues that could most affect your industry and Colorado’s economic future.

Voting is your right, and we encourage you to make up your own mind. But in case you want to know where CAR stands on critically-important ballot issues that will impact Colorado or have an impact on your real estate business, we offer you the following information:

gions of the country seeing no gains in sales activity last month, according to NAR’s report. Total existing home sales—completed transactions for single-family homes, townhomes, condos, and co-ops— dropped 3.4 percent in September compared to August, and are now at a seasonally adjusted annual rate of 5.15 million. Sales are down 4.1 percent from a year ago.

“This is the lowest existing home sale level since November 2015,” says Yun. “Decades-high mortgage rates are preventing consumers from making quick decisions on home purchases. All the while, See Sellers | Page 3

© Copyright Colorado Association of Realtors.

Reprinted with permission.

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Jay Gupta's September Housing Stats

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As we turn the pages of the calendar to the season of Fall and your T.V. is filled with playoff baseball, football and those pesky political ads, remember there is a lot to consider this election cycle that could dramatically impact your business and Colorado’s economic future.

It’s a LONG ballot this year (more than 3 pages!) and doing your civic duty will be more work this year, but we want to remind you that we are very fortunate to live in America and have the freedom to vote. So we hope that you embrace this opportunity and return your ballot by November 6th.

In this day and age when there are so many emotions at or near the surface on many controversial issues that divide friends, families, and office environments, we encourage you to be a critical reader and look at many different sources of information to help you make decisions on how you would like to vote.

In that context, we’d like to offer you some information you can review as you receive your ballots in the mail during the week of October 15-19. The CAR Government Affairs Division – in coordination with our many talented and dedicated volunteers on our policy committees and interview teams comprised of members throughout the state – have been working throughout the summer and fall to find REALTOR® Champions that are the most supportive of REALTOR® Party housing-based issues.

October 29, 2018

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National News............ Page 2 Local News................ Page 5 On the Move.............. Page 8 Local Expert.............. Page 10 Around the Corner....... Page 11

Honest & Ethical Service from People You Know.

Debbie Havens

Joe Drew

(719) 264-1967

(719) 266-6155

Loan Officer Assistant

NMLS #1492476 State Lic #100507484

NMLS #1561851 State Lic #100506142

Branch Manager 1730 Chapel Hills Drive Suite 100, Colorado Springs, CO 80920

HELPFUL TIP: Check the license status of your mortgage broker at the Colorado Division of Real Estate’s website.

Corp NMLS #3113

NMLS #653845 State Lic #100018256

debbie.havens@academymortgage.com

Loan Officer

joe.drew@academymortgage.com

Amanda Smith

(719) 264-1952

amandas@academymortgage.com

Nathan Johnson

Loan Officer

Samantha Barton

(719) 264-7972

Loan Officer Assistant

NMLS #1647443 State Lic #100018505

NMLS # 1662419 State Lic #100509254

nathan.johnson@academymortgage.com

(719) 424-7220

samantha.barton@academymortgage.com MAC218-1453439

National News

10 Hottest ZIP codes in the nation right now Not affiliated with The Colorado Springs Business Journal

Colorado Springs Real Estate Journal LLC 4655 Fencer Road, Colo Spgs, CO 80911

Director of Advertising Rachelle Nardo

rachelle@csrej.com

Director of Publishing Josh Olson

josh@csrej.com Colorado Springs Real Estate Journal LLC (CSREJ) is locally owned and operated out of Colorado Springs, Colorado. CSREJ is published once a month and distributed through USPS, digitally, or by hand to nearly all members of The Pikes Peak Association of Realtors® and The Colorado Springs Housing & Building Association and many other industry-related professionals.

In the hottest housing markets— Kentwood, Mich., being the most active ZIP code in the country—highincome millennials are a driving force behind the real estate boom, according to new research from realtor.com®.

“As the millennial generation continues to age, they are looking for affordable suburbs with strong school systems while still being relatively close to a downtown center,” according to

realtor.com® researchers. Millennials also are looking for areas with a strong sense of community and plenty of outdoor amenities, such as parks and hiking trails.

Realtor.com® looked at the time it takes properties to sell and how frequently homes are viewed in each ZIP code to determine this year’s hottest ZIP codes. Homes in these areas sell in an average of 20 days, which

CSREJ is not responsible for any opinions or facts expressed by non-staff writers. CSREJ shall not be held responsible for any errors in advertising or editorial content.

Realtor® is a registered trademark. Sometimes the word Realtor® or Realtors® will appear without the “®” symbol for the purpose of saving space. The registered trademark should be assumed if it is not present.

We welcome the submission of articles, photos and press releases. Email josh@csrej.com your submissions or questions.

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October 29, 2018

National News is 46 days faster than the rest of the country. In the majority of the top 10 ZIP codes, the markets are more affordable than their surrounding areas (excluding Worthington, Ohio, and Upper Montclair, N.J.); the household income tends to be greater than the national median; and the average unemployment rate is 3.6 percent, which is lower than the U.S. rate of 3.9 percent. The hottest ZIP codes for 2018, according to realtor.com®, are:

1. Kentwood, Mich.: 49508 Median listing price: $193,168 Days on the market: 14 days

5. Peabody, Mass.: 01960 Median listing price: $424,685 Days on the market: 20 days

9. Rochester, N.Y.: 14624 Median listing price: $131,964 Days on the market: 22 days

2. Colorado Springs: 80922 Median listing price: $297,811 Days on the market: 15 days

6. Boise, Idaho: 83704 Median listing price: $251,324 Days on the market: 23 days

10. Upper Montclair, N.J.: 07043 Median listing price: $762,350 Days on the market: 22 days

3. Watauga, Texas Median listing price: $183,576 Days on the market: 15 days

7. Worthington, Ohio Median listing price: $291,305 Days on the market: 25 days

4. Castro Valley, Calif.: 94546 Median listing price: $784,238 Days on the market: 16 days

8. Overland Park, Kan.: 66210 Median listing price: $261,927 Days on the market: 24 days

© Copyright National Association of Realtors.

Reprinted with permission.

GOT NEWS? josh@csrej.com

Sellers from 1 affordable home listings remain low, continuing to spur underperforming sales activity across the country.”

The 30-year fixed-rate mortgage has jumped from an average of 3.99 percent in 2017 to an average of 4.63 percent in September. Freddie Mac reported this week that rates are averaging 4.85 percent.

“Rising interest rates coupled with increasing home prices are keeping first-time buyers out of the market, but consistent job gains could allow more Americans to enter the market with a steady and measurable rise in inventory,” Yun says.

Here’s a closer look at some key housing indicators from NAR’s latest report: Home prices: The median existing-home price for all housing types was $258,100 in September, a 4.2 percent increase compared to a year ago.

Days on the market: Forty-seven percent of homes sold in September were on the market for less than a month. Properties stayed on the market an average of 32 days in September, down from 34 days a year ago.

All-cash sales: All-cash transactions comprised 21 percent of real estate sales in September, up from 20 percent a year ago. Individual investors tend to make up the biggest bulk of cash sales.

They purchased 13 percent of homes in September, down from 15 percent a year ago.

Distressed sales: Foreclosures and short sales made up 3 percent of sales in September, which is the lowest since NAR began tracking such data in October 2008. Broken out, 2 percent of sales in September were foreclosures and 1 percent were short sales. © Copyright National Association of Realtors.

Reprinted with permission.

October 29, 2018

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October 29, 2018

Local News CAR is proud to offer access to health benefits and more for all members beginning January 1st, 2019 Recently, REALTORS have been looking for alternatives to increasing insurance costs and in some cases a lack of access to group health insurance altogether. Offering an affordable employee benefits package will be another advantage of your CAR membership in 2019. In June of 2018, President Trump released an Executive Order expanding Association Health Plans, prompting CAR to reexamine AHPs for our membership.

Association Health Plans have, in fact, been available to industry associations for many years, but the new final rules do offer some new options.

Under the new guidelines, working owners without employees, including sole proprietors, can join plans offered through the association. The final rules also allow for expansion of Association Health Plans to the SelfFunded Market, which seemed like great news.

The challenges of putting together an Association Health Plan in Colorado start with the Colorado Division of Insurance. After the recent Executive Order, Colorado’s Interim Insurance Commissioner sent a letter to Health and Human Services asking for clarification on several points of the order. The Division has indicated

they will be hesitant to approve new Association plans until an adequate response has been received from HHS. This has prompted the Major Medical Carriers in Colorado such as Aetna, Anthem, Cigna and others to take a “wait and see” approach until after additional clarification has been received. Another unfortunate challenge to Association Health Plans are carriers’ past experience in that arena. Traditionally, Association Health Plans have been a great value to members for the first few years, then have often not run well the longer the plan runs. As larger claims are paid out, carriers are forced to tighten up underwriting guidelines and increase rates often creating a spiral of higher costs and fewer members as the plan matures. Eventually, membership is able to find better value outside of the Association plan, effectively ending that plan’s viability.

Carrier participation and contribuSee Insurance | Page 7

FRAUD IN A REAL ESTATE TRANSACTION HAS THE POTENTIAL TO AFFECT EVERY PARTICIPANT. The best defense is vigilance and a determination to TRUST, BUT VERIFY when suspicions arise. At North American Title, we are committed to working closely with our real estate agent customers and their clients to raise awareness of fraud schemes that can wreak havoc on a real estate transaction.

To learn more about how you can join us in our fight against fraud, visit www.nat.com/COPreventFraud Count on North American Title to protect you and your client throughout the real estate transaction process.

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COLORADO SPRINGS – NORTH 8610 Explorer Drive | Suite 105 Colorado Springs, CO 80920 t: 719.598.5355 www.nat.com/CO

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Colorado Springs Real Estate Journal

October 29, 2018

Local News Insurance from 5 tion requirements, as well as medical underwriting, can be additional obstacles for associations. At this time, fully insured carriers in Colorado have proven to continue to be hesitant to offer Association Health Plans. CAR will continue to monitor the availability of fully insured and self-funded Association Health Plans and continue to look for innovative opportunities for CAR members to access quality employee benefits.

For 2019, CAR’s Solution for medical coverage will be APEX. APEX is an affordable limited medical plan option that satisfies the Individual Mandate of the Affordable Care Act for any member that signs up.

• No-cost preventive care • Unlimited teledoc visits at no cost (multi-lingual) • Access to one of the largest medical networks in the country, PHCS including 3 primary care office visits per member per plan year ($20 copay), 3 specialty visits per member per year ($50 copay), 3 Urgent Care visits per member per year ($50 copay), $50 copay for diagnostic lab and x-ray (up to 5 services per member per year) and $200 copay for CT Scan/MRI (1 per plan year) and available discounts for members that need additional services • Pharmacy coverage through WellDyneRx with copays as low as $1 for low cost generic drugs • Hospital indemnity plan through Beazley featuring direct payments to members if the member is hos-

pitalized. ($2000 per admission, $750 per day and a $150 ER benefit. Limitations apply) This is a voluntary product which will be available to you and all of your employees and families at extremely affordable rates. Rates start at $197.44 for any aged employee only, $348.81 for an employee and spouse, $316.77 for an employee with children, and $483.56 for a family. It is important to note that this is a limited medical

plan and not an ”unlimited” insurance plan which is one of the reasons it is so cost-effective.

CAR will be rolling out this affordable limited medical plan offering, along with dental, vision, life, disability, critical illness, accident policies and more, through an on-line benefits exchange exclusively available to Association members and their staff.

All lines of coverage are available on a voluntary, a-la-carte basis, and pre-

MORE WAYS

miums can be paid on-line directly by each member – meaning each business owner will not have to worry about collecting and paying premiums for their covered employees.

Additional plan information, rates for additional lines of coverage and the link to sign up will be available soon! Please keep an eye out for future emails providing the link to the exclusive CAR Member Benefits website.

TO

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Pink Realty, headquartered in Colorado Springs, Colorado, is thrilled to announce their inclusion in the 2018 edition of the Inc. 5000 List! With an overall ranking of 4,674, Pink Realty ranks at #221 for Real Estate, and #125 of all businesses in Colorado. The Colorado Springs Headquarters location ranked one of only 8 companies in Colorado Springs to make the list.

The list recognizes innovative leaders in business nationwide and the entire Pink Realty team is incredibly proud of this accomplishment. Inc. 5000 is a highly-respected publication in the greater business community and Pink Realty is honored to be included on this esteemed list.

October 29, 2018

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On the Move Cindy Knighten Pink Realty I am a graduate of the University of Minnesota where I also received a commission as an officer in the United States Air Force through the ROTC program. Between the ranks of 2nd Lieutenant and Captain, I was a Squadron Commander of more than 750 airmen in Biloxi, Mississippi; and Protocol Officer for two different four-star generals at NORAD and Space Command Headquarters in Colorado Springs, Colorado. Since fulfilling my military commitment I have worked in the insurance industry and mortgage loan industry but real estate sales has been my career now for more than 25 years. I recently returned to Colorado after living in Florida and I'm SO happy to be here "at home" with Pink Realty!

Richie, Hubert, Reed RE/MAX Real Estate Group RE/MAX Real Estate Group is pleased to announce that Linda Richie has become the Managing Broker

for RE/MAX Real Estate Group. Wellknown to graduates of Jones (Kaplan) Real Estate College, Linda brings more than 30 years of education, training, and management expertise to RE/ MAX Real Estate Group. Linda possesses a Masters Degree in Business with more than 15 years of University teaching and management experience, and she holds the coveted designations of QSC, CRS, ABR, LHP, and e-PRO. She is known throughout Colorado as a “contract expert.” Linda will run the Intern Training Program at RE/MAX Real Estate Group educating and mentoring agents to help ensure success in their real estate careers. Linda has been a broker in Colorado for over 30 years and continues to help buyers and sellers achieve their goals in real estate!

Mark Hubert is a proud member of the Shane Ray Team at RE/MAX Real Estate Group. He is married to Jennifer and they have two boys, Tyler and Oliver. In addition, Mark’s family loves their two labs, Wrigley and Belle.

Mark became a realtor due to his love of working with people and appreciation of homes and the many different available styles in Colorado Springs.

What sets him apart are his many years in construction and knowledge of the Colorado Springs area. Mark worked in construction with Classic Homes as a post production warranty specialist and that experience allows Mark to best service his clients as he is

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keenly aware of what to look for when they are buying a home or trying to sell their current home. In his spare time, Mark enjoys golfing, playing the drums, working on projects around his home and landscaping.

Adrian Reed has lived here since 1972 and has watched Colorado Springs grow into a thriving city.

Prior to real estate sales she moved to San Diego when the economy in Colorado declined in the early 1980’s and worked for Memorex as a sales rep and traveled 3 states. She had the opportunity to return to Colorado Springs in 1992 and decided real estate would be a great career with all her sales background.

Reine, Coyle, Thieme Keller Williams Partners Shawn Reine is originally from New Orleans, Louisiana but got to Colorado as fast as he could! He currently serves as a Community Pastor for University Assembly and he loves helping the community, along with working with small business owners to raise awareness to the needs of the neighborhood. He has been considering Real Estate for many years and finally felt this was the perfect time. He looks forward to learning and growing his business to help serve this wonderful community. We couldn’t be more excited to have him on board!

Angie Coyle has lived in Colorado Springs and Fountain for the past 15 years and graduated from Rampart High School. She has dappled in many careers including the food industry, business, nursing, and military. After she got out of the Army she decided to get into real estate and see what this career has to offer her and her family. She is very excited to get going and KW stands behind her.

Tom Thieme is not a Colorado Springs native, but he got here as

soon as he could! He has been at home in Colorado Springs since 2003, after trading in Houston for this wonderful mountain setting. Prior to entering into the Real Estate field, Tom spent 28 years in the IT industry, with 18 of those years as a manager or director. He brings 28 years of project management, operation support, and customer service to his Real Estate clients. All of this previous experience about systems, controls, and methodologies make for great real estate practices.

Scott Vaughan Aspen View Homes Aspen View Homes in Colorado Springs is proud to announce Scott Vaughan as our Director of Sales. Scott values a close working relationship with the Real Estate Community and brings a tremendous amount of experience and knowledge of the New Home Industry with him to this position. Scott was raised in southern Arizona where he was heavily influenced by parents and grandparents who were in the real estate industry. His grandfather owned a real estate brokerage in Green Valley, AZ and his father worked in the new home industry for 30+ years as successful sales leader.

Scott is the youngest of four siblings and all, but one is currently in the real estate industry. Scott began his new home career in 1999 in Tucson, Az and within his first year was named sales man of the year at a large active adult builder. He moved to Colorado Springs with his wife of 23 years and their two daughters in 2001. He continued his new home career path with a large National Builder and soon after moved into a leadership position. His philosophy of Servant Leadership has served him well as he has been part of teams that have delivered the best new home experience to his customers, while consistently achieving sales and closing goals. In his time away from his work he enjoys spending time with his family, hiking and he is an avid golfer.

KERYN DERUBIS ALLISON BARNETT 719.930.3447

719.233.0494

90 S. CASCADE AVE., SUITE 950 COLORADO SPRINGS, CO 80903

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Colorado Springs Real Estate Journal

October 29, 2018

Local Stats COLORADO SPRINGS AREA

Colorado Springs AreaSales Analysis Housing Stats Dashboard and COMPILED AND ANALYZED BY:

Housing Stats Dashboard and Sales Analysis

JayCompiled Gupta, BME MA MRE and analyzed by: CRS CMRS SRES CDPE

2008 ,PPAR 2010 REALTOR® of the Year Jay Gupta BMEChairman MA MREand CRS CMRS SRES CDPE

CARChairman Research Committee Southeast Region ® of theSpokesperson Year 2008 PPAR and 2010 REALTOR With over 2-BillionSoutheast in personalRegion and managed sales CAR Research Committee Spokesperson With over 2-Billion in personal managed Berkshire Hathaway Home and Services Rockysales Mountain, REALTORS® Berkshire Hathaway Home Services Rocky Mountain, REALTORS® For comments & questions, please contact: JayKGupta@gmail.com For comments & questions, please contact: JayKGupta@gmail.com www.ColoradoSpringsHomesAndStats.com www.ColoradoSpringsHomesAndStats.com

Housing Stats Dashboard

Single Family/Patio Homes Sold Through Pikes Peak MLS New Listings Active Listings Monthly Sales YTD Sales % of Active Listings Sold Monthly Sold Volume YTD Sold Volume Median Price Average Price % of List Price Received Average Days on Market Months' Supply % of Sold Listings … Sold in 0 to 30 Days … Sold in 31 to 60 Days … Sold in 61 to 90 Days … Sold in 91 to 120 Days … Sold in 121+ Days

September 2017 September 2018 1,442 1,517 2,145 2,449 1,509 1,273 12,449 12,097 70.3% 52.0% $467,334,316 437,845,672 $3,899,026,800 4,214,945,613 $275,000 305,750 $309,698 343,947 99.4% 99.4% 26 27 1.4 months 1.9 months 75.5% 13.5% 5.2% 3.0% 2.8%

Sales Analysis

73.1% 15.9% 5.7% 2.4% 2.9%

Change 5.2% 14.2% (15.6)% (2.8)% (18.3)% (6.3)% 11.2% 11.2% 11.1% 0.0% 3.8% 35.7% (2.4)% 2.4% 0.5% (0.6)% 0.1%

Single Family/Patio Homes Sold Through Pikes Peak MLS September 2017 September 2018 % of Total Months % of Total Months Price Range Monthly Supply Monthly Supply Sales Sales Under $199,999 13.9% 0.6 months 6.8% 1.2 months $200,000 to $299,999 47.3% 0.6 months 40.8% 0.9 months $300,000 to $399,999 21.7 % 1.6 months 29.5 % 1.8 months $400,000 to $499,999 8.8% 2.8 months 12.2% 2.7 months $500,000 to $599,999 4.1% 3.0 months 4.6% 4.6 months $600,000 to $799,999 3.3% 4.3 months 4.2% 4.2 months $800,000 to $999,999 0.5% 12.5 months 0.9% 10.5 months $1,000,000 to 0.3% 29.5 months 1.0% 8.8 months $1,999,999 Over $2 million 0.1% 33.0 months 0.0% Infinite Disclaimer: This representation is based in whole or in part on information from the Pikes Peak REALTOR® Services Corp. (“RSC”) or its PPMLS for the period of September 2017 and 2018. Content is deemed reliable; however, neither the RSC nor the PPMLS nor PPAR nor Jay Gupta guarantees or is in any way responsible for its accuracy. Data maintained by RSC does not reflect all real estate activity in the market. © Copyright Jay Gupta. All rights reserved.

Unauthorized reproduction is prohibited.

Jay Gupta’s Observations and Remarks In the Colorado Springs-area housing market, during the past couple of months, there has been a noticeable increase in the sales of single family/patio homes priced over $800,000. The September year-over-year sale of homes priced over $800,000 was up 85 percent. There’s a great opportunity for buyers to buy in this price range as the supply and demand situation is terrific. There was a 14 percent increase in active listings of single family/patio homes, which improved the month’s supply of inventory to 1.9 months from 1.4 months in September 2017.

Every improvement in the supply of homes is highly welcomed by buyers as it eases the pressure for making instantaneous decisions. On the other hand, the rising interest rates along with a more than 11 percent increase in both the median and average prices made it even more challenging for first-time buyers to purchase a home.

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Sept 2018: Active Listings 2,449 Sales 1,273 Listings Sold 52.0% Months’ Supply 1.9 Sept 2008: Active Listings 6,030 Sales 734 Listings Sold 12.3% Months’ Supply 8.2 Sept 1998: Active Listings 3,792 Sales 717 Listings Sold 18.9% Months’ Supply 5.3

8.7% of Single Family/Patio Homes Sold in Sept 2018 were Priced Between $500,000 and $800,000: There is a great opportunity for buyers and sellers to buy and sell in this price range with a great supply and demand situation.

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‘Price Segmented’ Supply and Demand Analysis • 89.4% of Single Family/Patio Homes Sold in Sept 2018 were Priced Under $500,000: The exceptionally low inventory in this price range is providing an excellent opportunity to list and sell properties as there are plenty of buyers ready and willing to buy.

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Unprecedented Supply and Demand Imbalance (Single Family/Patio Homes) • • •

CUSTOM RUBBER STAMPS

September 2018 Sales Analysis By MLS Areas Compiled by Jay Gupta Single Family/ Patio Homes

MLS Area

# of Months' # of Sold Supply Active Listings Listings

Sales Volume $

All Real Estate Market Activity is 67 8 8.4 4,320,500 182 83 2.2 35,053,790 78 66 1.2 18,498,621 75 73 1.0 20,936,800 234 210 1.1 58,899,333 19 9 2.1 3,682,500 112 39 2.9 13,252,754 125 96 1.3 30,159,130 150 48 3.1 25,150,814 51 39 1.3 16,876,976 33 29 1.1 9,529,550 147 107 1.4 31,190,845 48 64 0.8 15,242,545 130 62 2.1 26,287,167 158 65 2.4 34,197,403 32 17 1.9 7,824,400 77 21 3.7 9,845,400

Median Price $

Average Price $

SP to Avg. List DOM %

"Local" 637,500 400,000 240,000 268,000 279,450 412,000 325,000 295,000 471,950 415,000 280,000 290,000 236,500 327,750 495,000 309,900 360,000

540,062 422,334 280,282 286,805 280,473 409,166 340,070 314,157 523,975 432,742 328,605 291,503 238,164 423,986 526,113 460,258 468,828

99.4 99.4 99.2 100.1 100.3 97.0 99.9 100.0 99.3 99.4 99.5 100.0 100.0 98.8 98.7 97.8 98.1

•

1.9% of Single Family/Patio Homes Sold in Sept 2018 were Priced Over $800,000: It is an opportune time for buyers to buy in this price range as there is a wide selection of properties to choose from and there are motivated sellers.

•

A Comparison of Sept 2018 Sales Data with Previously High Record Setting Sept 2005 • Active Listings are down by (44.8)% • Months’ Supply is down at 1.9 from 3.6 months in 2005 • Monthly Sales are up by 3.3% • YTD Sales are up by 19.9% • Monthly Dollar Sales Volume is up by 42.5% • YTD Dollar Sales Volume is up by 71.4% • Average Sale Price is up by 38.1% • Median Sale Price is up by 46.7%

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Historically Low-Interest Rates: During the 2005-2006 record-setting real estate market, the interest rates were hovering around 6%. The current historically low rates (in the 4.75% range) are providing financially qualified home buyers an incredible opportunity to stretch their buying power and lock-in the low rates for 30-years. It is important to keep in mind that every 1% increase in the interest rate reduces the borrowing power by 10% for the same amount of monthly payments.

In recent months, interest rates have started to move upward and additional small increases are anticipated in the coming months.

Black Forest Briargate Central East Fountain Valley Manitou Springs Marksheffel Northeast Northgate Northwest Old Colorado City Powers Southeast Southwest Tri-Lakes West Woodland Park

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Note: It is important to keep in mind that even in a hot real estate market with low inventory, not every property listed for sale sells. Buyers generally buy realistically priced properties offering competitive values.

Disclaimer: This representation is based in whole or in part on information from the Pikes Peak REALTOR® Services Corp. (“RSC”) or its PPMLS for the period of September 2018. Content is deemed reliable; however, neither the RSC nor the PPMLS nor PPAR nor Jay Gupta guarantees or is in any way responsible for its accuracy. Data maintained by RSC does not reflect all real estate activity in the market. © Copyright Jay Gupta. All rights reserved. Unauthorized reproduction is prohibited.

October 29, 2018

Colorado Springs Real Estate Journal www.csrej.com

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Local Expert Interest rates may rise; here is a word to the wise

Empire Title of Colorado Springs

5755 Mark Dabling Blvd., Ste 110, Colorado Springs, CO 80919 Phone: (719) 884-5300 - Fax: (719) 884-5304

There is no doubt that interest rates do affect the real estate market. They will dictate how much we can buy and what our payments will be. I will give examples of both scenarios and dive a little deeper into our market looking at other factors like

By Bill McAfee consumer confidence and emotion.

President The first scenario deals with purchase power. If you have a Empire Title — $63,840 income and want to spend 25% of your income on a home, this is how it would work. Twenty-five percent of $63,840 is $15,960; divide that by 12 and you have a monthly payment of $1,330 dollars. A 3.4% interest rate on a 30-year mortgage gives you the ability to purchase a $300,000 home. I reference a 3.4% interest rate because that is the lowest the Freddie Mac 30-year fixed mortgage has been since 1971, or the last 47 years, according to the Freddie Mac website.

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Freddie Mac 30 Yr. Fixed Rate Mortgage

Empire Title of Woodland Park 350 N. Pine St., Woodland Park, CO 80863 P.O. Box 9004, Woodland Park, CO 80866 Phone: (719) 686-9888 - Fax: (719) 686-8208

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1220 Main St., Canon City, CO 81212 Phone: (719) 275-4900 - Fax: (719) 235-5029

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16.0%

14.0%

12.0%

8.0%

4.72%

6.0%

4.0%

2.0% January - 1971

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Brian Miller 719-440-2942

18.0%

10.0%

Empire Title of Canon City

Doreen Hussmann 719-499-6301

20.0%

September - 2018

Currently interest rates are at 4.72%. Keeping income consistent, a 1.32% increase in interest rate lowers purchasing power from $300,000 to $256,000 – a decrease in purchasing power of 14.67%.

It is obvious how an increase in interest takes down purchasing power. Now let’s look at payments, which is what most people look at and is our second scenario. Payments are calculated based on purchase price and interest rates. If you wanted a certain payment and have not maxed qualified on your income, here is a scenario: a $300,000 home at 3.4% amortized over 30 years would have a payment of $1330. An increase in interest rates from 3.4% to 4.72% would take payments from $1330 to $1560. Once again, a 1.32% increase in interest rates increases the payment 17%. I have just given you the facts; now, let’s look at the real world. People buy on emotion and then try to justify it with logic.

According to the Wall Street Journal and Investopedia, consumer confidence has hit an 18-year high. The “Consumer Confidence Index - CCI” is the leading economic indicator for the US economy. This means people feel confident spending money because they believe economic conditions are good. Spending drives the US economy, which includes real estate. There are other factors as well that indicate the real estate market may be plateauing, which is healthy in a rising interest rate environment.

If home prices and interest rates are both moving up, we can logically see what it does to purchasing power and payments. With our real estate market and Colorado Springs’ economy experiencing low unemployment, a good job market, increasing wages, low inflation, and a strong stock market - it’s easy to see why consumer confidence is high.

When consumer confidence is high, people tend to buy. We have had interest rates over 18% on 30-year fixed mortgages in September of 1981. I call this the finger year. Looking at the chart above, it looks like you got the finger if you borrowed money that year.

A word to the wise: when you emotionally buy, try to use good information to justify your decision. Here are the facts: from 1973 to 1986, those 13 years had rates well above 8%; from 1986 to 2000, rates averaged around 8%; and, since 2000, rates have steadily declined until 2013. In the past 5 years, they have started climbing. In conclusion, for 40 years the rates have been higher than they are now. We have been spoiled for the last 7 years. Here’s your way to emotionally buy and justify in today’s market. You are not getting the finger like you would have in 1981, and buying now makes the interest rate you got 85% better than those who have borrowed over the last 47 years.

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josh@csrej.com October 29, 2018

Around the Corner Thursday, November 8 Farm and Land 8:30am @ The Egg and I - Chapel Hills Charlie Triplett: 719-896-1777 YPN (Young Professionals Network of Realtors) 3pm-4pm Meeting @ PPAR (board room) 4pm-6pm Social @ Red Martini (downtown) 719-633-7718 | mvanmetre@ppar.org Thursday, November 1 eContracts – Beginners 10am-12pm @ Empire Title rsvp@etcos.com 719-884-5300 2018 ACU 9am-1pm @ Sellstate Alliance Realty asalladay@legacytitle-llc.com Tuesday, November 6 Election Day

FIRPTA: Foreign Investment in Real Property Tax Act 10am-11am @ Empire Title rsvp@etcos.com 719-884-5300 Business Evaluation 10am-11am @ Legacy Title asalladay@legacytitle-llc.com

October 29, 2018

UPCOMING DEADLINES Deadline

Thursday, November 22 Thanksgiving

Tuesday, November 13 NARPM Luncheon 11am-1pm @ Hotel Eleganté coloradosprings.narpm.org 2018 Real Estate Contract 1pm-5pm @ Empire Title rsvp@etcos.com 719-884-5300 What is the Cloud 9am-10am @ Legacy Title asalladay@legacytitle-llc.com How To Kill It With Social Media Advanced 10am-2pm @ HBA www.cshba.com

Wednesday, November 7 Cyber Fraud Trends in Real Estate 9am-10am @ Empire Title rsvp@etcos.com 719-884-5300

CTM eContracts Intermediate 2pm-4pm @ Legacy Title asalladay@legacytitle-llc.com

Wednesday, November 14 Listing homes for disabled and deceased clients 1pm-4pm @ Legacy Title asalladay@legacytitle-llc.com HBA Annual Membership Reception & Board Installation 5pm-8pm @ Cheyenne Mountain Resort www.cshba.com Thursday, November 15 Annual Commission Update 9am-1pm @ Empire Title rsvp@etcos.com 719-884-5300

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*EVENTS SUBJECT TO CHANGE Due to limited space, please check with event and class holders early for more detailed information on cost, CE credits, sponsors and registration dates.

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Vol. 9 No. 5

January 30, 2017

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Builders pick up the pace this winter Housing production nationwide edged up 11.3 percent on a seasonally adjusted basis in December due to a surge in multifamily construction, the Commerce Department reported this week. Multifamily production – often viewed as volatile month-to-month – surged 57 percent to 431,000 units in December.

Single-family starts, on the other hand, fell 4 percent to a seasonally adjusted annual rate of 795,000 units. But builder sentiment remains high for the single-family market’s outlook.

“Despite the slight dip in singlefamily production, December’s rate

is still the fourth highest single-family pace since the Great Recession, and single-family starts also posted solid gains for the year,” says Granger MacDonald, chairman of the National Association of Home Builders. “Builders remain confident and we expect further growth in the single-family market in the year ahead.”

Across the country, combined single and multifamily housing production increased 31.2 percent in the Midwest; 23.5 percent in the West; and 18.5 percent in the Northeast.

The South was the only major region to post a loss, dipping 1.4 percent last month.

"This report represents firm growth for housing in 2016, as single-family starts rose 9 percent and multifamily production was down slightly," says Robert Dietz, NAHB’s chief economist. "We expect that 2017 will be another year of gradual, steady improvement in the housing market.

Multifamily starts have been volatile in recent months, but should level off as supply meets demand. Meanwhile, single-family production continues to gain momentum but is limited by supply-side headwinds."

Single-family permits – a gauge of future construction – increased 4.7 percent to 817,000 units in De-

America’s 10 healthiest housing markets What makes a healthy housing market? According to SmartAsset, it is one that shows stability, affordability, and in which homeowners are able to easily sell their homes with a low risk of losing money over the long run.

The healthiest housing market in the country: Edgewood, Ky., a suburb of Cincinnati. Homes in Edgewood

Call Rachelle // 719.439.0773 rachelle@csrej.com

spent an average of 56.3 days on the market, significantly less than the national average of 169.6 days.

Indeed, seven of the top 10 markets in the U.S. are located in towns within the Midwest region, including three markets that are in Michigan.

To determine the healthiest housing markets in the country, SmartAsset took into account factors like

the percentage of homeowners with negative equity; the average time a for-sale home spends on the market; affordability as the monthly cost of owning a home (and as a percentage of household income in each county and city); among other factors.

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cember. That is the highest level in 2016. Multifamily permits, however, dropped 9 percent to 393,000 units, the Commerce Department reports. © Copyright National Association of Realtors.

Reprinted with permission.

Trump puts a halt to FHA mortgage cuts Just hours after being sworn in, President Donald Trump moved to suspend a plan to reduce the Federal Housing NAR officials Administra“disappointed” tion’s mortgage insurance premiums that was set to go into effect on Jan. 27. The plan had been announced just a few days ago by the outgoing Obama administration and Housing and Urban Development head Julian Castro.

The reduction in premiums by 25 basis points, or a quarter percentage point, “has been suspended indefinitely,” according to an FHA news release.

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National News ........... Page 2 Local News ............... Page 7 On the Move ............. Page 13 Local Expert ............. Page 14 Around the Corner ...... Page 15

Sharon Ballinger

Will Michaloski

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e m o H

s y a d i l o H e h t r fo

For this holiday season, anyone who purchases one of our select inventory homes* will receive a move-in gift from us!

Incredible buyer incentives plus...

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• side-by-side refrigerator • blinds ** • washer/dryer Call (719) 382-9433 to be directed to the appropriate Sales Specialist. *For select inventory homes that can close by December 31st, 2018 with use of seller’s preferred lender, Pentrust. **Blinds per plan See your Sales Specialist for the inventory list and promotional details.

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