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Housing Stats and a Little Turkey Talk…Happy Thanksgiving!

Some good news was released this week from Fannie and Freddie: maximum loan limits will remain unchanged for 2010. The Federal Housing Finance Agency announced that the maximum conforming loan limits for mortgages originated in 2010 will remain unchanged from their 2009 numbers. The maximum loan limits for counties across the United States can be found here (116 pages).

The news in the media over the last two weeks has largely been about the potential benefits of the new expanded and extended home buyer tax credit which opens the doors for existing homeowners to take advantage of a $6,500 tax credit. There have certainly been quite a few articles regarding the tax credit over the last two weeks. I did come across an interesting article on Reuters.com which stated, “Up to 400,000 people bought a home for the first time due to the credit, boosting first-time buyers to a record 47 percent of sales over the past year, the National Association of Realtors has said. With the help of the credit, existing home sales will rise 2 percent this year and 13.6 in 2010, the group estimates.”

To say the least, 2009 was a very challenging year in real estate. The good news is that after a very rough 2008 and early 2009, we started to see a positive turn in the housing market as the year wore on, thanks in part to the first-time home buyer stimulus and indications that the economy was starting to improve. So now the big question of the day is, what will 2010 bring?

With the improvement we are seeing on Wall Street and the economic improvements we are seeing on a global scale, things seem to be moving in the right direction, which makes prospective home buyers feel more confident about their future and the home they may choose to buy. So much of our business is affected by consumer confidence.

Also on a positive note, the default notices are actually declining in Colorado.

But I would caution that we probably aren’t out of the woods as it relates to foreclosures. With unemployment figures still frighteningly high, there are still quite a few homeowners out there who are struggling with their payments. And now there is a great deal of evidence that it isn’t just in the entry level arena; it is also hitting the mid-level and luxury market, too.

The big question is when is the “shadow” inventory of already foreclosed homes going to be released, now that the government has lifted the moratoriums on foreclosures. Once we start to move through those properties, we should begin to see a better, more solid grounding for the real estate market.

For real estate, this feels like more of a long “L” shaped recovery than a “U” shape.

The fact is, we live in one of the most desirable regions in the world. Certainly we’ve taken our fair share of hits over the last three years, but our region’s desirability, economic vitality, culture, weather and overall market conditions make it a sought-after place to live. We generally have a much healthier economy. This, I believe will help drive our long, slow, modest recovery.

I am encouraged by the progress we are making in the real estate market. As we track sales activity, we are seeing more encouraging signs. Based on what we’re seeing, we’re estimating that we can expect sales to moderate to a more sustainable pace and we will probably see a modest rise in housing prices. Will it be the double digit appreciation we saw in the earlier part of the decade? Probably not. But this new normal is much more sustainable and a much healthier foundation to build upon. It makes me excited about the future and gives us all hope for a relatively modest and productive 2010.

Now, let’s take a look at this week in real estate:

• Boulder/Longmont—Longmont reported this was the week of waiting for buyers and sellers. Everyone was standing still, waiting to see if the buyer’s credit was going to be extended, and it was! Yahoo! The housing industry can continue on with its help in assisting the turnaround of our sellers calling our Agents, ready to list even at this traditionally "slow" time of year.
• Evergreen/Conifer—Evergreen reported there was a total of one new listing for the week. Two listings went under contract during the week one, a single family home in Aurora on the market for one day before receiving the offer. One buyer went under contract on a HUD property. We had a total of 53 showings during the week. For the month of October, a total of eleven new listings were taken and a total of 269 showings. Ten listings went under contract with a total of 107 days on market.
• Denver Central – No information reported.
• Devonshire—This week in the Devonshire office we've seen a definite slowdown in showing activity. There are still homes going under contract & closing but showings are down & open houses are showing the same decline in attendees. On a great note, the tax incentives have been extended & expanded which has created quite a buzz. Now that we know the perameters are for this incentive package, it will bode well for a surge of activity going forward in 2010. Sellers should do repairs/renovations/updating in anticipation of getting their homes on the market. We all know that the homes that show well & are priced competitively will sell in a timely manner. On behalf of all the members of the Devonshire office, we thank you for your business in the past & look forward to working with you in the future. Please join us for a complementary photo with Santa in the office December 5th from 10:00AM to 4:30PM.
• Douglas County—No information reported.
• El Paso County— Colorado Springs reports the diminishing urgency of 1st time buyers after the extension of the tax credit was felt on all levels. Showing activity as well as sales activity has dropped significantly. The fast approaching holiday season & the changing weather has also caused some of the sellers to hold off on listing their home. On a positive note, we expect activity to pick up strong after the 1st of the year. We also expect a great turn out for our annual office Holiday Photo Event.
• Larimer County— Showings are down as well as inventory since last week & winter is slowly making its way towards us. But not all is lost! The new home buyer tax credit offers a wonderful opportunity for not only the 1st time home buyers but also for the move-up buyer that have lived in their home for five or the last eight years. Keep in mind that you now have until April 30th to put your new home under contract and you must close by June 30th to receive the credit. Be sure to ask your local Coldwell Banker agent how you can take advantage of this opportunity before it's gone!
• North Metro— The North Metro office has listed 35 new homes this month. The average price of our listings this month is $274,000 which is an increase of 4% from the past month. Of the 48 homes that are under contract with us this month, we're seeing most of them under $225,000. Homes are difficult to find in this price range at this time & when available go under contract quickly. Much excitement surrounding the extended tax credit with agents reaching out to buyers that were uncertain about the outcome of this initiative but are now looking to buy.
• Parker— After a last rush to get buyers under contract before the looming tax credit deadline the news about the extension & expansion calmed some of the buyers down & caused & also caused a number of sellers to hold off on listing their property. Agents are preparing for a strong first part of 2010 and are contacting their sphere with updates about the new limitations of the tax credit. The office preparations for the Holiday Photo Event are in full force & we expect a high number of clients to take advantage of this great opportunity.
• Southeast Metro— The surge of first time homebuyers continues! We are experiencing multiple offer situations in several price points and specifically homes over $250,000. Some of the homes that have been in multiple offer situations have been on the market for awhile and are a direct result of the time crunch for the tax credit. We have placed 120 properties under contract this month and we will close over 150 units. November is looking great with 100 units already scheduled to close! Despite the unpredictable weather, open house traffic continues to be strong and serious buyers are out there!
• West Lakewood— We are very pleased that the extension and expansion of the tax incentive program has passed. We haven't felt the increase in activity yet but are anticipating it in the next weeks and months. We may not feel the change until after the holidays when move up buyers start to move.

I’ll leave you with a few interesting articles of note from the week:

• Cheaper Prices—More Than Tax Credit—Motivating Home Buyers; U.S. News and World Report
• Tax Credit Expands Home Buyer, Economic Opportunities; On Pace To Help 70% Of Potential Home Buyers; RISMedia
• Housing Cooled In October; Tax Credit Extension Expected To Drive Improvements; RISMedia
• Real Estate Outlook: Moving Towards Recovery; Realty Times

Finally, I’d like to take this opportunity to wish you and your families a very warm and blessed Thanksgiving. Despite the challenges in the market and the bumpy road we have taken to get here, we all have a great deal to be thankful for. Family. Friends. Health. Food. A roof over our heads. These are all things to hold close and cherish this special time of year. I for one am thankful for you and appreciate what you do each and every day. I feel so fortunate to be President of Coldwell Banker Residential Brokerage and am proud to be leading our team into 2010.

Happy Thanksgiving! Please enjoy the time with your family and friends and we’ll return the week of the 30^th with another exciting edition of Weekly Market Watch.

Warm regards,

Chris Mygatt

Exciting New Opportunities for Move-Up Buyers and First Time Home Buyers!

I have some good news to share with you. The U.S. House of Representatives voted by an overwhelming 403-12 margin to approve the Unemployment Compensation Extension Act (H.R. 3548) that included, as an amendment, the extension and expansion of the Homebuyer Tax Credit. The bill already passed in the U.S. Senate yesterday by a vote of 98-0, so now it will advance from Congress to the White House for President Obama’s signature. It is one step away from being signed into law, and the Administration already has signaled its support of the Homebuyer Tax Credit amendment as well as the President’s intention to sign the bill.

This is an historic moment for our industry as well as the culmination of more than a year’s worth of hard work and meetings with elected officials and policy makers on the part of Realogy management. I am both proud and appreciative of how so many of our employees, franchisees and sales associates participated in various grass roots outreach efforts with Congress. Our Company’s efforts on Capitol Hill truly helped make a difference on this issue.

Again, this bill is now one step away from becoming law. Our voices were heard in Washington, D.C., and we should be proud that our government is taking strong action to help our industry and the economy. Having an extended and expanded Homebuyer Tax Credit available to qualified homebuyers through the first half of 2010 undoubtedly will benefit our business and the U.S. economy.

The new bill calls for an incentive for buyers who have owned their current homes at least five years, making them eligible for tax credits of up to $6,500. First time homebuyers – or anyone who hasn’t owned a home in the last three years – would still get up to $8,000. To qualify, buyers in both groups have to sign a purchase agreement by April 30, 2010 and close by June 30.

The credit is available for the purchase of principal homes costing $800,000 or less, meaning vacation homes are ineligible. The credit would be phased out for individuals with annual incomes above $125,000 and for joint filers with incomes above $225,000.

The credit would be extended an additional year, until June 30, 2011, for members of the military serving outside the United States for at least 90 days.

As an industry, we are certainly pleased that the tax credit may be extended and expanded. The key to returning stability to the economy lies within the housing market, and we have crafted a meaningful credit that will create a strong foundation for future growth and make a measurable difference over the next seven months in our economy.

Furthermore, tax credits like this only work by creating the sense of urgency to take advantage of them. This is said to be the last extension of the home buyer tax credit and I urge people – whether they’re first time home buyers who’ve always dreamed of having a home of their own or someone who has been gridlocked in the challenges of our move-up market to take advantage of this opportunity.

In other real estate news, NAR released its pending home sales report this week which showed that pending home sales rose again, making eight consecutive monthly gains—the longest streak since measurement began in 2001.

The report showed pending home sales rose 6.1 percent to 110.1 from a reading of 103.8 in August and is 21.2 percent higher than September 2008 when it stood at 90.9. The gain from a year ago is the largest annual increase on record, and the index is at the highest level since December 2006 when it was 112.8.

I agree with NAR’s assessment that the momentum is based on a rush of first-time home buyers trying to beat the expiration of the tax credit at the end of November. We’re feeling that rush in many of our offices.

As to keep things in perspective I would like to point out NAR’s Chief Economist Lawrence Yun’s comments that “We’re clearly not out of the woods because an excess of homes remain on the market despite recent improvements,” he said. “Although current inventory is getting closer to price equilibrium, foreclosures will continue to enter the pipeline. An extended and expanded tax credit would help absorb this income inventory.” That truly is why we are so pleased with the potential of the bill’s passing.

Now, let’s take a look at this week in real estate:

• Boulder/Longmont—The 3 day snowstorm caused a real blip in the numbers last week, with sales, listings, and showings all down. The good news to be gleaned is that even though sales and listings were both down about 20%, showings were only down a little over 10%, so there is still real buyer activity out there.
• Evergreen/Conifer— All activity negatively affected by two snowstorms during the reporting period. Our office closed for 2 days. Snow totals ranging from 2 to almost 4 feet in market area. Activity gradually returning to more normalized levels. Total of 108 showings during the prior month- 35% of activity in price range under $200M & 25% from $200M- $300M. Noticeable increase in activity in $400M-$500m range as well as $500M-$750M ranges
• Denver Central – No information reported.
• Devonshire—No information reported.
• Douglas County—Our Southwest Metro office reports showings were down but this had a lot to do with our weather this past week. Agents are very busy showing buyers homes as the deadline is very near for the 8000 tax credit. We are seeing sellers gearing up to list their homes by the beginning of next year. We did have success in our open houses this past weekend and floor calls have been great. Our agents are very busy trying to find homes for first time buyers and are very excited about the news of the extension of the program as well as the new credit available for current owners.
• El Paso County— Colorado Springs reports we have experienced a drastic slowdown in showing and sales activity. The listing inventory is steady and a high number of closings is scheduled for the end of the month. The expected extension/expansion of the home buyer tax credit is taking some urgency off the buyers as well of some sellers that have planned to put their homes on the market before the holidays.
• Larimer County—No information reported.
• North Metro—No information reported.
• Parker— Although showing activity has slowed down again, the sales activity is was steady even with the approaching deadline of the tax credit. It seems that buyers are confident that the extension/expansion will be passed in the House as well. Power priced listings still sell very fast. If the tax credit extension is going to be passed, we expect some sellers to hold off putting their home on the market until after the holidays. We have 154 properties scheduled to close and sellers are enjoying an increase in buyer activity. Even with the colder weather, we're averaging over 500 showings a week so far for the month. The luxury home market is also seeing an uptick in traffic as 20% of our luxury home listings are currently under contract.
• Southeast Metro— The surge of first time homebuyers continues! We are experiencing multiple offer situations in several price points and specifically homes over $250,000. Some of the homes that have been in multiple offer situations have been on the market for awhile and are a direct result of the time crunch for the tax credit. We have placed 120 properties under contract this month and we will close over 150 units. November is looking great with 100 units already scheduled to close! Despite the unpredictable weather, open house traffic continues to be strong and serious buyers are out there!
• West Lakewood— No information reported.

I wanted to let you know that we are officially making Weekly Market Watch a once every other week publication. With the market changing very little from week to week we just felt it was an obvious choice. If news or the market warrants, we will return to once per week or we will simply provide you with special editions.

We will return with our next edition of Weekly Market Watch on November 19.

Until then,
Make it a great November,

Chris Mygatt
Coldwell Banker Residential Brokerage Colorado

It’s On The Table!

There’s no question. The government’s first-time homebuyer tax credit has spurred a significant amount of sales this year and its positive impact on the hard-hit housing market warrants an extension. Latest estimates show that some 400,000 additional sales occurred this year due to the first time home buyer tax credit, which is about 8% of all sales this year.

The latest news in the saga, The Senate has reached a compromise on extending and expanding the $8,000 tax credit for first-time home buyers. While its passage remains uncertain, the agreement would extend the existing credit for first-time homebuyers, worth up to $8,000, while offering a new credit of up to $6,500 for some existing homeowners. The reduced credit would be available to all homeowners who have been in their current residence for a consecutive five-year period in the past eight years. Lawmakers in Washington also raised the qualifying income limits to $125,000 for single taxpayers and $250,000 for joint taxpayers, from the current $75,000 and $150,000. Under the Senate compromise, buyers must have sales agreements in hand by April 30, but they will have until June 30 to go to settlement, said the sources. The measure still faces votes in the full Senate and the House.

The U.S. Senate won’t vote until next week at the earliest. As soon as they do we intend to create a piece that will allow you to communicate the news to your clients.
Reports show that Senate action has been delayed by a Republican demand that a vote be allowed on an amendment to end the Treasury Department’s Troubled Asset Relief Program at the end of this year. But lawmakers say they want to prevent home sales from slipping as the economy struggles to recover. And as I mentioned in a previous edition of Weekly Market Watch, that is just what may happen if lawmakers choose to let the tax credit expire.

On the flip side, the Democrats, along with the Obama administration are backing it. “The success of the American economy is closely tied to the success of the housing market; by helping to stabilize the housing market, the homebuyer tax credit has helped to shore up the economy as it begins to recover,” said Baucus, a Montana Democrat. “This would enable an even greater number of potential homebuyers to take the credit.”

Thus far it seems to be doing its job. This week, Business Week reported “The broad improvement in the housing indicators in recent months leaves no doubt that the long-awaited housing recovery is finally under way.” The article went on to report: “Policy alone cannot explain the 24% gain in existing home sales since January, nor the 22% increase in new-home purchases, the 40% rise in single-family housing starts, and the recent upturn in home prices.
The primary driver is historically high affordability. Fixed 30-year mortgage rates are at 5%, a multi-decade low, and prices have plunged a total of 30% since May 2006, based on the Standard & Poor's Case-Shiller Home Price Index. By that price gauge, homes are well undervalued relative to both rents and aftertax income.”

Next week I hope to report some positive news on the home buyer tax credit front. Until then, let’s take a look at this week in real estate:

• Boulder/Longmont—The Boulder office reported new listings in Boulder county remained steady this week, but sales fell 17% from last week. This caused available inventory to climb. Showings on our listings fell about 4% but our top ten listings averaged one showing per day over the past week. The sales to list ratio in the Boulder/Louisville market remains steady at 98% (not including the over $1,000,000 market). The Longmont office reported the push is on for the "$8000 tax credit buyer" to be under contract. Lenders are pushing to get buyers qualified. Entry level homes are being shown almost exclusively. Our listing inventory for move-up homes is stagnant. The Colorado weather is adding to the uncertainty. Snow and cold early this Fall season makes the buyers less likely to venture out. Colorado is still looking good for employment possibilities. Our rate of unemployment is not reaching the levels seen on both coasts. This is a great time to start a real estate portfolio.
• Evergreen/Conifer—No information reported.
• Denver Central – Our under contracts for October continue to remain high. There has been an increase in first time home buyers looking for property and wanting to take advantage of the $8,000 tax credit. With the deadline fast approaching and the possibility of an extension not occurring buyers have to act quickly. Congress did extend the deadline for military service individuals. We continue to see inventory shortages in the Denver market which has created offer situations in the lower end market. The inventory is substantially lower than its highpoint in 2007. Over 50% of the home sales in the Denver metro area are under $250,000. If you're looking to sell a home priced under $300,000 this is a great time & take advantage of one of the better markets to move up into a higher priced home. We've seen many move-up buyers entering the market recently. Overall, we are very encouraged and excited about the future of real estate in Denver.
• Devonshire— No information reported.
• Douglas County—No information reported.
• El Paso County—No information reported.
• Larimer County— Showings are steady and primarily at the first time buyer price point, $250,000 or less. We've seen a slight upswing in new inventory coming on the market since last week. Unfortunately the cold weather has kept some buyers at home, but this only allows inventory to build. A word to the wise, if you are still looking to take advantage of the 1st time home buyer tax credit you may want to stay away from short sale transactions. We've had several agents report that short sales are still taking longer to complete. With any luck, the tax credit will be extended & those who are under contract but in danger of not closing prior to the Nov 30th deadline will still have a chance to get in on this great opportunity.
• North Metro— No information reported.
• Parker –No information reported.
• Southeast Metro— The surge of first time homebuyers continues! We're experiencing multiple offer situations in several price points and specifically homes over $250,000. Some of the homes that have been in multiple offer situations have been on the market for awhile & are a direct result of the time crunch for the tax credit. We've placed 120 properties under contract this month & we'll close over 150 units. November is looking great with 100 units already schedules to close! Despite the unpredictable weather, open house traffic continues to be strong & serious buyers are out there!
• West Lakewood— Activity is starting to taper off. Listings are dropping off. Under contracts are still steady and showings are dropping off perhaps because of Halloween weekend coming up

Next week I will release the November edition of Reality Check. In it, we focus on the state of the market and include an interview with me. I think you’ll find it helpful and informative in educating your clients and prospects on the current state of the housing market.

Until then,
Make it a great week,
Chris Mygatt
Coldwell Banker Residential Brokerage Colorado

“U.S. Economic Recovery on Track”

While we await the results of the possible expiration, extension or expansion of the $8,000 first time home buyer tax credit, one thing is for sure, the economy is moving forward in full force—which is driving consumer confidence. Earlier this week, Reuters.com ran a very interesting story on the U.S. economic recovery and the result was very encouraging. Among the story’s highlights:

• “The U.S. economy is firmly poised for a recovery from its deep recession but growth may be moderate and the job market will not revive immediately, senior White House aide Lawrence Summers predicted on Wednesday.”
• “On the economy, Summers said the $787 billion stimulus package and inventory rebuilding by businesses were among the “dominant drivers” lifting the economy.”
• “It will be some time before unemployment starts to decline. Once it declines it will take a long time to return to normal levels, given how elevated it is…The jobless rate is now at a 26-year high of 9.8 percent.”
• “Most private economists think the recession, which began in December 2007, ended in the third quarter. But there is much disagreement about the path to recovery.”
• “Some see above-average growth continuing through next year, arguing that deep recessions are typically followed by powerful recoveries, helped along by pent-up demand as consumers and companies resume spending.”

Obviously this is welcome news for the economy which ultimately benefits the local housing market. What I can tell you is that I am encouraged by the progress we are making in the real estate market. We’re beginning to see more days of progress than days of back stepping. We’re watching sales activity and consumer sentiment and we are expecting over the coming months a moderate to a more sustainable pace and we will probably see a modest rise in housing prices in the coming year. Will it be the double digit appreciation we saw in the earlier part of the decade? Probably not. But this new normal (as we’re calling it) is much more sustainable and a much healthier path to build upon. It makes me excited about the future and gives us all hope for a relatively modest and productive 2010.

Now, let’s take a look at this week in real estate:

• Boulder/Longmont—The Boulder office reported Boulder county showed a small shift in the right direction over the past week. New listings were down by about 7% with sales up 9%, so we have inventory headed down again. Although most of this was in the lower price ranges, there was a small flurry of sales over $800,000 including one at $2,750,000! Our Agents report multiple offers on bank owned properties. Showings on our listings remain steady with a 1% increase over the past week.
• Evergreen/Conifer—Evergreen reported we had a total of four new listings for the week. Three listings went under contract during the past week, two of these were out of state buyers. Two buyers went under contract, both on short sale properties. There were a total of 64 showings during the week. Conifer reported we had only one new listing during the week. Four of our current listings were put under contract, two were REO properties and one was a short sale. None of our buyers were put under contract. The number of showings decreased to 22 for the week.
• Denver Central – No information reported.
• Devonshire— No information reported.
• Douglas County—Our Southwest Metro office reports showings increased a little this past week. We did have several successful open houses and three great floor calls. Our Agents are very busy working with buyers and the market continues to be picking up for sellers and buyers both. Inventory continues to be low especially in the $150,000 range. Most are first time buyers trying to take advantage of the tax credit and sellers are starting to realize that this is a good time to list their home. We're working hard to get our sellers to list their homes now and not wait until the beginning of the year.
• El Paso County—Colorado Springs reports although the showing activity has decreased by 15% over the last week, the number of properties under contract has tripled mainly because of the looming deadline for the first time buyer tax credit program. Therefore our listing inventory has decreased slightly as well. With the changing weather we expect the sales activity to slow down drastically, especially if the tax credit program is not going to be extended. The number of multiple offers on Power Priced listings has gone down drastically, which is an indication that most of the "great deals" are off the market.
• Larimer County— Showings are down significantly last week as well as under contract homes in Fort Collins/Loveland. This is most likely a seasonal decline and is to be expected. On the plus side, we had an increase of new inventory coming on to the market and several homes were subject to multiple offers. Multiple offer situations are a great sign for sellers, as this situation typically gets an above listing price contract. To create a multiple offer situation you need to have three primary things going for your listed property - price, condition and location. These three items make for a perfect storm that will entice buyers to compete for your home. Finally, don't forget, only 40 days until the 1st time home buyer tax credit runs out!
• North Metro— Even though it is October and the weather has been quite cold, we've not seen a slow down in activity. The Agents continue to list properties with an increase in average sales price of $267,000. The buyers wanting to take advantage of the tax credit are out looking, but properties under $250,000 are going quickly with multiple offers. It is a great time for seller's to get their homes on the market. With inventory low, their will be less competition for buyers.
• Parker –The seasonal changes are showing their signs in number of showings and transactions. The activity has slowed down some more over the last week however. Web traffic is very steady and the number of leads on our listings from the internet is increasing. Our affiliates (Title & Mortgage) are preparing for a peak of business during November because of the tax credit deadline on the 30th. Agents are preparing for our next Client Appreciation Event coming up on December 6th. Free Holiday Photo.
• Southeast Metro— The heat is on! First time home buyers who are looking to take advantage of the $8000 tax credit are storming the market! We're seeing an increase in the already fierce competition for all properties priced below $225,000. Last week we had one listing that had 105 showings in six days! That has to be some kind of record! And by the way, that same property received 45 offers! It's still a great time to buy, whether or not a buyer qualifies for the tax credit. Open houses are still enjoying lots of traffic in several price ranges.
• West Lakewood— No comments provided.

This week I’ll conclude with a few articles of interest:

• What Housing Bust?; CNN Money
• Housing Tax Credit Working, So Keep Momentum Going, NAR Urges Congress; Realtor.org
• Shape Of The Housing Recovery; CNBC
• Real Estate Outlook: Mixed Signals; Realty Times

Until next week,
Make it a great one,

Chris Mygatt
Coldwell Banker Residential Brokerage Colorado

Recent Housing Upturn Sparked By Buyer Leverage

The latest S&P/Case-Shiller home price index reveals home price for 10 major cities rose 3.6 percent between April and July. So does this recent uptick in the housing market mean we are on the cusp of a housing boom?

I hate to burst your bubble but probably not. In all likelihood, the recent upturn in the housing market has been sparked by several competing factors:

· The impending expiration of the $8,000 first-time home buyer tax credit
· The recent uptick in the stock market
· Increased consumer confidence
· Continued low interest rates

Essentially, buyers are playing a leverage game. They’re watching the economic indicators and trying to determine the best time (for them) to buy. It seems many are now pulling the trigger which is causing sales figures and prices to go up.

Will it last? It’s tough to say. Right now we’re in a slightly unique position because some of the stimulus packages that the government instituted are working which may be causing a false front for the overall economy. The stock market is up. Consumer confidence is on the rise. The housing market is up. All of those are pointing to some current benefits in the market.
But, the fundamentals themselves haven’t changed. Foreclosures remain a major issue for our economy. And unemployment remains a major challenge. Until those two areas of the economy fully recovery, we may see continued economic volatility.

What I can say is I think the worst of the housing market’s problems are probably behind us. But the road ahead isn’t completely clear. One major factor that stands in our way is the impending expiration of the first time home buyer tax credit. This credit has helped to drive much of our recovery. But right now the debate on Capitol Hill continues and everyone is waiting to learn whether the credit will be extended, expanded or will it simply expire. Many on the opposing side believe it is too costly to finance. But NAR had this to say: “Each home sale pumps an additional $63,000 into the economy through related goods and services, so the benefits of extending and expanding the tax credit far outweigh the costs.”

If the opposing side gets their way and the credit simply expires, NAR had this to say: “All we can say for certain is sales will decline when the tax credit expires because we are not yet on a self-sustaining recovery path. It also raises a risk of a double-dip recession. Extending and expanding the tax credit is the best tool in our arsenal to encourage financially qualified buyers to stimulate the economy and help reduce the budget deficit.”

So there you have it. We’re in a state of flux as we await the results of the credit. As that debate continues, buyers seem to be leveraging today’s market advantages which is creating a welcome relief for our local market. Let’s just hope the leveraging opportunities continue.

Now, let’s take a look at this week in real estate:

• Boulder/Longmont—The Boulder office reported sales and listing activity were up very slightly in Boulder County last week both about 3%. Showings were down slightly, about 5%. A check of inventory in Boulder County over the past three months shows a disturbing trend. 297 new listings in July, 362 new listings in August and 395 in September. We'll see if the upward trend continues in October.
• Evergreen/Conifer—Evergreen reported we had two new listings for the week. Two of our listings went under contract. We had 61 showings during the week. Conifer reported there were no new listings during the week. No listings or buyers were put under contract. Showings decreased to 29 for the week.
• Denver Central – There has been an increase in 1st time home buyers looking for property and wanting to take advantage of the tax credit. The deadline has been extended for military service individuals. Since there has been an increase in buyers taking advantage of this credit we've seen an inventory shortage for homes under $200,000. We have also seen an uptick in the average sales price and we attribute that to more move-up buyers entering the marketplace. We continue to have low inventory levels in the Denver Metro market. The inventory is substantially lower than its highpoint in 2007. We're very excited about the future of real estate in Denver. Showings are continuing to increase year over year.
• Devonshire— We seem to be on the upward swing this week with showing activity picking up and buyers more active in the market. The cold weather seemed to motivate sellers to adjust their prices and for buyers to get down to business and put offers on the table. Perhaps that with the holidays fast approaching some momentum has been created. Sellers need to remember to keep their yards manicured so that buyers can see the landscaping under the leaves. Keeping gutters empty and leaves raked up makes the buyer feel that the home is well cared for & in good condition. Interest rates are still very appealing and there is still time to take advantage of the tax credit incentive. We're feeling optimistic about the rest of October and November.
• Douglas County—Our Southwest Metro office reports showings were down this past week, though we did see an increase in listings and many of our Agents reported that they had listing appointments as well. We're seeing 1st time buyers ready to take advantage of the low interest rates and the $8000 credit before it expires. Several Agents have reported that buyers are not finding the inventory as high as it was a couple of months ago and the quality of the selection is not as good. We're working hard to have our potential sellers list now rather than wait until next year especially with inventory low.
• El Paso County—Colorado Springs reports last week was the 1st sign of a slow market facing the upcoming Fall and Winter season. The last few buyers got under contract to close before the tax credit deadline of November 30th. A Coldwell Banker call for action was answered by countless real estate professionals from various companies in order to encourage our representatives to extend and expand the tax credit program. We hope that the call will be answered and atleast the deadline will be extended.
• Larimer County—The Fort Collins/Loveland offices reported new listings are up in Northern Colorado and showings are also up nearly 10% from the previous week. We're seeing an increase of bank owned homes in the last month and there are certainly some good deals. These homes are priced as high as $1,500,000 all the way down to $65,000. The boost in home showings seem to be coming from 1st time buyers looking to take advantage of the tax credit. Many of these new lower priced bank owned properties are already under contract. The move up buyer that has been sitting on the sideline is also getting involved somewhat as undervalued homes are being purchased. For example the bank owned home referenced above for $1,500,000 was previously listed for $3,200,000!! There are good deals to be had, so get out and find a new home today!
• North Metro—The overall activity for the North area has picked up again, which is important as we move into the fourth quarter. Our listings have continued to pick up as well. This last week we are averaging 6 to 7 listings per day. At the same time, the sales have increased from 3 to 4 per day to between 5 and 6.
• Parker— The showing activity continues to be steady and the sales activity is stable as well. The listing inventory is also constant as supply and demand seem to be more balanced in most neighborhoods and price ranges. The high end market is still very slow and on some listings about $1,000,000 we see no traffic at all. We are very excited about a big food drive our Agents are organizing and we are overwhelmed by the participation of the entire community.
• Southeast Metro— October is shaping up to be a great real estate month at our DTC office! We have 154 properties scheduled to close and sellers are enjoying an increase in buyer activity. Even with the colder weather, we're averaging over 500 showings a week so far for the month. The luxury home market is also seeing an uptick in traffic as 20% of our luxury home listings are currently under contract.
• West Lakewood— As you can imagine, with the 1st time homebuyer tax credit deadline nearing, agents are extremely busy showing properties to these excited buyers. We see multiple offers on many homes. There were numerous under contracts in the past week on homes that have been on the market less than thirty days. We see that investors are still very active in the market as well.

This week I’ll conclude with a few story highlights:

• USAA Praises Biggert Bill To Extend First-Time Homebuyers Tax Credit; Reuters
• Hopes Run High For Tax-Credit Expansion; MarketWatch
• Washington Report: $8,000 Home Buyer Tax Credit; Realty Times

Until next week,
Make it a great one,

Chris Mygatt
Coldwell Banker Residential Brokerage Colorado




The latest S&P/Case-Shiller home price index reveals home price for 10 major cities rose 3.6 percent between April and July. So does this recent uptick in the housing market mean we are on the cusp of a housing boom?
I hate to burst your bubble but probably not. In all likelihood, the recent upturn in the housing market has been sparked by several competing factors:
· The impending expiration of the $8,000 first-time home buyer tax credit
· The recent uptick in the stock market
· Increased consumer confidence
· Continued low interest rates
Essentially, buyers are playing a leverage game. They’re watching the economic indicators and trying to determine the best time (for them) to buy. It seems many are now pulling the trigger which is causing sales figures and prices to go up.
Will it last? It’s tough to say. Right now we’re in a slightly unique position because some of the stimulus packages that the government instituted are working which may be causing a false front for the overall economy. The stock market is up. Consumer confidence is on the rise. The housing market is up. All of those are pointing to some current benefits in the market.
But, the fundamentals themselves haven’t changed. Foreclosures remain a major issue for our economy. And unemployment remains a major challenge. Until those two areas of the economy fully recovery, we may see continued economic volatility.
What I can say is I think the worst of the housing market’s problems are probably behind us. But the road ahead isn’t completely clear. One major factor that stands in our way is the impending expiration of the first time home buyer tax credit. This credit has helped to drive much of our recovery. But right now the debate on Capitol Hill continues and everyone is waiting to learn whether the credit will be extended, expanded or will it simply expire. Many on the opposing side believe it is too costly to finance. But NAR had this to say: “Each home sale pumps an additional $63,000 into the economy through related goods and services, so the benefits of extending and expanding the tax credit far outweigh the costs.”
If the opposing side gets their way and the credit simply expires, NAR had this to say: “All we can say for certain is sales will decline when the tax credit expires because we are not yet on a self-sustaining recovery path. It also raises a risk of a double-dip recession. Extending and expanding the tax credit is the best tool in our arsenal to encourage financially qualified buyers to stimulate the economy and help reduce the budget deficit.”
So there you have it. We’re in a state of flux as we await the results of the credit. As that debate continues, buyers seem to be leveraging today’s market advantages which is creating a welcome relief for our local market. Let’s just hope the leveraging opportunities continue.
Now, let’s take a look at this week in real estate:
Boulder/Longmont—The Boulder office reported sales and listing activity were up very slightly in Boulder County last week both about 3%. Showings were down slightly, about 5%. A check of inventory in Boulder County over the past three months shows a disturbing trend. 297 new listings in July, 362 new listings in August and 395 in September. We'll see if the upward trend continues in October.
Evergreen/Conifer—Evergreen reported we had two new listings for the week. Two of our listings went under contract. We had 61 showings during the week. Conifer reported there were no new listings during the week. No listings or buyers were put under contract. Showings decreased to 29 for the week.
Denver Central – There has been an increase in 1st time home buyers looking for property and wanting to take advantage of the tax credit. The deadline has been extended for military service individuals. Since there has been an increase in buyers taking advantage of this credit we've seen an inventory shortage for homes under $200,000. We have also seen an uptick in the average sales price and we attribute that to more move-up buyers entering the marketplace. We continue to have low inventory levels in the Denver Metro market. The inventory is substantially lower than its highpoint in 2007. We're very excited about the future of real estate in Denver. Showings are continuing to increase year over year.
Devonshire— We seem to be on the upward swing this week with showing activity picking up and buyers more active in the market. The cold weather seemed to motivate sellers to adjust their prices and for buyers to get down to business and put offers on the table. Perhaps that with the holidays fast approaching some momentum has been created. Sellers need to remember to keep their yards manicured so that buyers can see the landscaping under the leaves. Keeping gutters empty and leaves raked up makes the buyer feel that the home is well cared for & in good condition. Interest rates are still very appealing and there is still time to take advantage of the tax credit incentive. We're feeling optimistic about the rest of October and November.
Douglas County—Our Southwest Metro office reports showings were down this past week, though we did see an increase in listings and many of our Agents reported that they had listing appointments as well. We're seeing 1st time buyers ready to take advantage of the low interest rates and the $8000 credit before it expires. Several Agents have reported that buyers are not finding the inventory as high as it was a couple of months ago and the quality of the selection is not as good. We're working hard to have our potential sellers list now rather than wait until next year especially with inventory low.
El Paso County—Colorado Springs reports last week was the 1st sign of a slow market facing the upcoming Fall and Winter season. The last few buyers got under contract to close before the tax credit deadline of November 30th. A Coldwell Banker call for action was answered by countless real estate professionals from various companies in order to encourage our representatives to extend and expand the tax credit program. We hope that the call will be answered and atleast the deadline will be extended.
Larimer County—The Fort Collins/Loveland offices reported new listings are up in Northern Colorado and showings are also up nearly 10% from the previous week. We're seeing an increase of bank owned homes in the last month and there are certainly some good deals. These homes are priced as high as $1,500,000 all the way down to $65,000. The boost in home showings seem to be coming from 1st time buyers looking to take advantage of the tax credit. Many of these new lower priced bank owned properties are already under contract. The move up buyer that has been sitting on the sideline is also getting involved somewhat as undervalued homes are being purchased. For example the bank owned home referenced above for $1,500,000 was previously listed for $3,200,000!! There are good deals to be had, so get out and find a new home today!
North Metro—The overall activity for the North area has picked up again, which is important as we move into the fourth quarter. Our listings have continued to pick up as well. This last week we are averaging 6 to 7 listings per day. At the same time, the sales have increased from 3 to 4 per day to between 5 and 6.
Parker— The showing activity continues to be steady and the sales activity is stable as well. The listing inventory is also constant as supply and demand seem to be more balanced in most neighborhoods and price ranges. The high end market is still very slow and on some listings about $1,000,000 we see no traffic at all. We are very excited about a big food drive our Agents are organizing and we are overwhelmed by the participation of the entire community.
Southeast Metro— October is shaping up to be a great real estate month at our DTC office! We have 154 properties scheduled to close and sellers are enjoying an increase in buyer activity. Even with the colder weather, we're averaging over 500 showings a week so far for the month. The luxury home market is also seeing an uptick in traffic as 20% of our luxury home listings are currently under contract.
West Lakewood— As you can imagine, with the 1st time homebuyer tax credit deadline nearing, agents are extremely busy showing properties to these excited buyers. We see multiple offers on many homes. There were numerous under contracts in the past week on homes that have been on the market less than thirty days. We see that investors are still very active in the market as well.

This week I’ll conclude with a few story highlights:

USAA Praises Biggert Bill To Extend First-Time Homebuyers Tax Credit; Reuters
Hopes Run High For Tax-Credit Expansion; MarketWatch
Washington Report: $8,000 Home Buyer Tax Credit; Realty Times
Until next week,Make it a great one,Chris MygattColdwell Banker Residential Brokerage Colorado

Tax Credit: Expand? Extend? Expire?

The question everyone is asking is, will the government expand, extend or simply let the $8,000 first time home buyer tax credit expire. With just over 50 days left until it is expires, the debate is on and everyone is waiting on pins and needles to hear the result.

Whichever side you take on the debate, what you can’t deny is the fact that nothing has done more in the past year to jumpstart our housing market more than the $8,000 first time home buyer credit. Will all of that come tumbling down if it isn’t extended or expanded on? It’s hard to say but I believe that if it isn’t expanded we will see a definite drop in first time home buyers in 2010 and probably a much larger emergence of investors in the entry level arena. While on the surface that may not seem troubling, it actually is. The fact is that investors purchase homes solely for net profit while first time home buyers purchase homes for lifestyle. When we have a balance between the two it keeps home prices relatively stable. If one of the two disappears, we’ll likely start to see drops in home prices which isn’t good for a market that has already taken its fair share of hits.

While Congress continues to debate the issue what we as Realtors are calling for is support of an expansion of the tax credit from first-time buyers to all homebuyers, increasing the maximum amount of the tax credit from $8,000 to $15,000, eliminating the existing income caps for eligibility purposes and extending this homebuyer tax credit for one year from the date of enactment.

We believe that stimulating demand for housing—particularly in the repeat buyer market—is the most effective way for Congress to help lead the U.S. economy into a recovery and back on the path to growth. Timing is critical and we hope that Congress will hear our voices.
While the clock ticks and we await the results of the debate on Capitol Hill, let’s take a look at this week in real estate:

• Boulder/Longmont—The Boulder office reported the market stayed very steady last week with listing inventory moving by less than 1% and the amount of sales exactly even week to week. Our office showed a 10% increase in showings over the week before as agents report 1st time buyers scurrying to take advantage of the tax credit and lower interest rates. Multiple offers on lower priced short sales continues to be normal. The Longmont office reported showings have increased 10% week over week! Who knows what this fall will bring! Friday the 2nd was a recent record for showings here. I'm assuming that is the final push for the $8000 credit. This is the time to list your home especially if it's in the Longmont entry level, under $200,000. Buyers are scrambling to meet the deadline of November 30th. Lenders and title companies should be gearing up for mass closings that last week of November. Remember, that is also a "short work week.”
• Evergreen/Conifer—Evergreen reported we had a total of nine new listings for the week. Five listings went under contract during the past two weeks. There were four local buyers plus one cash buyer from Texas. Four buyers went under contract. All were local. There were a total of 77 showings during the week. Conifer reported we had only one new listing during the week. Two listings went under contract, one bank REO and one private seller. No buyers were put under contract. Showing activity decreased to 27 during the week possibly due to the holiday weekend. The Conifer office reported there was one new listing during the week. Five listings went under contract including land in Evergreen (cash buyer), one private seller (1st time home buyer) and three bank owned homes. Two buyers were put under contract including one single family home in Lakewood, a multiple offer situation. Showing activity increased to thirty eight during the week.
• Denver Central – There has been an increase in first time home buyers looking for property & wanting to take advantage of the tax credit. With the deadline (Nov 30) fast approaching and the possibility of an extension not occurring, buyers are going to have to select a property within the next 30 days to be able to close in time. Since there has been an increase in buyers taking advantage of this credit we've seen an inventory shortage for homes under $200,000. We've also seen an uptick in the average sales price which we attribute to more, move up buyers entering the marketplace. We continue to have low inventory levels in the Denver Metro market. Inventory is substantially lower than its highpoint in 2007. We continue to be excited and very encouraged about the future of the Denver real estate market.
• Devonshire— Well, here we are looking at fall in full swing. The market for first time buyers is very active with a definite lack of inventory. Sellers in price ranges that would benefit from the first time buyer program should get their homes on the market immediately. November 30 is quickly approaching. Looking at our Previews division, our homes over $600,000 show a different story although we are seeing definite signs of movement in this area. Showing activity is increasing and we're now finally seeing contracts coming in on these houses. We're still optimistic for a good 2010 in the upper end market.
• Douglas County—Our Southwest Metro office reports showings increased this past week over the previous three! Open houses were good and our Agents did acquire good leads. Our Agents do have sellers gearing up to list their homes and do have buyers starting to become worried about the deadline for the $8000 tax credit. We're seeing an increased number of buyers ready to move towards the purchase of a new home before the deadline. Our Agents feel that buyers do not want to miss this opportunity especially with low interest rates as well. Our mortgage rep is busy approving buyers and investors are wanting to take advantage of the low rates also.
• El Paso County—Colorado Springs reports the listing inventory stays steady at the moment but both showings and sales activity have slowed down during the last week. The current sellers hope for an extension/expansion of the 1st Time Buyer Tax Credit which is scheduled to end Nov. 30. Our REO Agents see a slight increase of bank owned properties hit the market. We expect that trend to increase over the next few weeks.
• Larimer County—The Fort Collins/Loveland offices reported steady as she goes - that should be the real estate motto for the Northern Colorado fall selling season. We're seeing a consistent number of homes sold at or above 98% of asking, a consistent number of homes coming onto the market and finally, a consistent number of showings. An agent with two listings put them both under contract in less than two weeks with competing offers. Both properties were priced below $250,000. There is still a significant amount of well priced inventory available so get online at www.coloradohomes.com or contact your local CB real estate professional and take a look at some great homes.
• North Metro— The North office is buzzing with positive feedback from the CBC this week. Agents are very excited about the prospects for a good 4th quarter and beyond. The current activity level is steady. Inventories are being depleted in the "1st timer's" price range and the upper end of the market remains soft. Concern on the economy continues to affect the listing activity but as the economy improves in the 4th quarter we expect market activity to do the same. Bottom line, everyone is up to the challenge of the changing market and will do what it takes to continue to be successful.
• Parker— After a drastic slowdown of showing and sales activity during August and September, the traffic is now steady again and the sales activity is stable as well. Our listing inventory has gone down slightly over the last two weeks. The traffic through open houses has increased as home buyers not only want to take advantage of the last few nice weekends, but are also in a time crunch with the ending of the Home Buyer Tax Credit.
• Southeast Metro—No information reported.
• West Lakewood—No information reported.

Here are a few informative links regarding the $8,000 tax credit that you may find helpful:

• Update: Industry Makes Case For Home Buyer Tax-Credit Extension; Wall Street Journal
• Builders Urge Congress To Act On Home Buyer Tax Credit, Appraisal And Lending Issues; National Association of Home Builders
• Homebuyer Tax Credit Best Tool For Sustaining Housing Recovery, Says NAR; NAR
• Make The Home Buyer Tax Credit More Easily Available At Closing; RISMedia
• 1.4 Million Families Have Taken Advantage Of First-Time Home Buyer Tax Credit, More Claims Expected; RISMedia

Until next week,
Make it a great one,

Chris Mygatt
Coldwell Banker Residential Brokerage Colorado

S&P Reports On The State of the Housing Market

One of the founders of what has really become the industry’s (and media’s) bible for real estate statistics and forecasts, S&P Case Shiller, recently participated in a Q&A about the state of the housing market. Robert Shiller, a Yale University economist, discussed the housing market and the implications of lower interest rates. I found it quite conservative yet insightful and in my opinion, on target with what is going on in today’s market.

That is why for this edition of Weekly Market Watch, I am going to provide you with an excerpt from his interview:

Is the slump in U.S. home prices bottoming out?

Shiller: The situation has definitely changed. With our numbers — the S&P/Case Shiller home price index — going up sharply. It looks like a major turnaround. We’ve been watching that for three months now, and we have some concern that it could be an aberration and temporary. But, at this point, it seems to be evident in just about every city in the U.S. That suggests it’s real. But it probably isn’t the beginning of a major boom, just because the economy is in such bad shape. There’s also a chance that it will reverse. It’s still only three months old, so it’s very hard to be sure at this point. The most likely scenario is that it won’t continue at this high rate of increase, but that it will neither go down a lot, nor up a lot.

So the index will move sideways for a while?

Shiller: Yes, for a while, meaning five years.

What are the main factors driving U.S. house prices? What could push them up, or cause another slump?

Shiller: The main factor is the world economic crisis and the efforts of governments around the world to stimulate the economy. Parts of those efforts have been directed at the housing market. In the U.S., there is an 8,000 dollar first-time home buyer’s tax credit which expires at the end of November. That’s a reason for concern, as it comes to an end. Also, the Federal Reserve has a plan to buy $1.25 trillion worth of mortgage-backed securities to support the housing market. They are most of the way through the program and anticipate phasing it out at some time in 2010 - that’s another thing that will go away. We’ve yet to see how the housing market will continue. Part of the problem is that people are buying now rather than later. When later comes, there could be a downturn in the market.

Is there an oversupply of houses in the U.S.?

Shiller: That’s been a problem. The inventory of unsold houses has been high, but has come down a bit. On top of that, there will be more foreclosures, more homes are going to be dumped on the market as people default. Now, that may show down as home prices will start going up again. But I suspect that this isn’t going to happen. Also, banks have more REO, or real estate owned, that they’re holding on to for the time being. But eventually those REOs are going to be dumped on the market. So that’s why it doesn’t look particularly encouraging from a supply consideration.

Turning to interest rates, which are at exceptionally low levels: Is there a risk that this eventually will cause irrational exuberance?

Shiller: There is always a risk of that. Those things are hard to predict. However it seems like the present time is least conducive to bubbles of any time. We’re in what some people call “pretend-and-extend” economy, which means that banks that have commercial loans are often extending those loans and pretending that the property is worth something. That’s because they don’t face reality. This kind of economy isn’t really suited to a beginning of a real bubble. Now, everything could change… It’s surprising how strong the residential, single-family home market looks right now. It makes me think that it’s hard to predict animal spirits.

How long can central banks afford to keep expansive policies in place?

Shiller: In principle we can keep this in place for a long time. That’s what Japan did… But confidence is definitely coming back. The depression scare is over at the moment. So it would be plausible that central banks could be raising interest rates — both in the U.S. and Europe — [as early as next year]. But I just have a worry that this isn’t going to happen and that it’s not going to be so easy to extricate [themselves from the low-rate environment].

Will the sharp increase in global debt levels drive up inflation over the medium to long-term?

Shiller: My best guess is that we won’t have inflation, that central banks will pull it back as inflation starts to begin. But I think that there’s a chance of it; people have to be defensive in their investments. It always amazes me that people are so trusting and that they want nominal debt as much as they do… So a good long-term strategy is to invest a good part of one’s portfolio in inflation-indexed bonds, even though it doesn’t particularly look like the time to worry about inflation right now.

I tend to agree with Shiller on many of his statements, specifically that we are probably in the midst of a turnaround. Having said that, it is important to point out that this isn’t going to be a sharp “V” recovery with a sudden jump in prices or units. In all probability what we will see is a long “L” shaped broad recovery in which prices are relatively stagnant for some time before eventually inching up.

Now, let’s take a look at this week in real estate:

• Boulder/Longmont—The Boulder office reported the biggest change in the Boulder County market over the past week was the big jump in showings for our office, up 18%. Listings and sales showed smaller changes, up 6% for listings, down 12% for sales. Increased showings seem to be the result of lower interest rates and Agents report more activity as first time buyers fear that the clock may run out on the $8000 incentive. The Longmont office reports showing activity is slowing just a bit. First time buyers and those in the lower price ranges are the main shoppers. Listings under $250,000 are being shown and sold. Right now, with the final push for the $8000 credit, any home under $250,000 that is NOT a short sales is snapped right up! Investors know that this is the time to buy. They are fine with the down payment. The rental market is strong. Now is the time to start your "Property Ladder"!
• Evergreen/Conifer—Evergreen reported we had eight new listings for the week. Two listings went under contract including one single family home on the market for three years and one single family home from a floor call, both local buyers. Two buyers put under contract in the last week, one out of state buyer from MD and one local buyer purchase of single family home in Parker, a mid $200,000 property on the market for less than a week. There were 69 showings plus ten agent previews during the week. Conifer reported there were no new listings during the week. No listings went under contract and no buyers were put under contract. Our showing activity increased to thirty-four during the week.
• Denver Central– There has been an increase in first time home buyers looking for properties and wanting to take advantage of the $8000 tax credit. With the deadline fast approaching and the possibility of an extension not occurring buyers are going to have to select a property within the next 30 days in order to close in time. The Denver real estate market continues to get positive national and local press on a weekly basis. We're very encouraged and excited about the future of real estate in Denver.
• Devonshire— Now that our few days of cold, wet weather are over, we're excited about a good open house weekend. Our September was a little quiet as it usually is but October in the Devonshire office is always a busy month. Sellers are anxious to show their homes with fall decorations and turning leaves. Buyers this year are busy getting homes under contract and closed prior to the end of November. We're advising all buyers and sellers to close no later than November 15th if possible due to the rush to get homes closed by the 30th and it'll cause title and mortgage companies to be overloaded. Also, the 30th is the day after Thanksgiving holiday weekend and that in itself may cause backlogs and stress. We're excited to see the activity and energy that fall brings.
• Douglas County—Our Southwest Metro office reports showings have been down the past three weeks especially this past weekend. Open houses were good and our Agents did acquire some good leads. Our Agents do have sellers gearing up to list their homes and do have buyers starting to become worried about the deadline for the $8000 credit. We feel that the public is in a holding pattern. They are waiting, especially buyers, to see if the $8000 credit will be extended or increased. We did have one Agent who had three of their listings go under contract in a week, one in 24 hours! We've had some great floor calls and also two walk-ins. Interest rates are good and we're seeing some buyers ready to start the process just in case the tax credit program is not extended.
• El Paso County—Colorado Springs reports the listing inventory is still very steady, however buyer activity increased drastically last week. This could be an indication that more first time buyers are getting very motivated in order to take advantage of the tax credit which will expire on November 30th. For the same reason, we see a number of multiple offers on energy priced listings that are not short sales! We received twelve (!) offers on one bank owned listing!
• Larimer County— New listings are up in both the Fort Collins and Loveland offices and the showing activity is also up from last week. Homes that went under contract this last week were listed as high as $637,000 down to $110,000 with most of the home sales in the mid-$200,000 range. There were also several homes priced in the $300,000 to $400,000 range. There are some great homes available and FHA rates are still at or near all time lows! More great news - There are still 70+ days to take advantage of the $8000 tax credit, but time is slipping away quickly. Realistically speaking, you need to be out looking at homes today if you hope to close prior to the November 30th deadline. You don't want to be closing at the end of November & risk having your closing pushed back past the deadline. Get out there and find your dream home at a great price and don't miss out on the $8000 tax credit!
• North Metro— Overall business continues to be steady for the month of September. Listing inventories are decreasing as we move into the late summer. Buyers are continuing to take advantage of the buyer program and as a result we're seeing a lot of activity at the $100,000 to $225,000 part of the market. Average prices are edging up and we feel that this will stimulate the listing side of the business.
• Parker— After a slowdown during August and early September, activity is picking up again. First time buyers are now very motivated to get under contract in order to close before November 30th to be able to take advantage of the $8000 tax credit. Power priced listings are still getting a lot of activity, multiple offers & some sell over asking price.
• Southeast Metro— Showing activity has increased and we're back to 500 plus per week. Listing inventory is steadily decreasing and the number of new listings in the market is also on the decline. However, sales activity is busier than ever! We're scheduled to close over 150 properties this month, which is not our typical September. The luxury market continues to be sluggish, however homes in the $700,000 range are seeing more activity than the previous month.
• West Lakewood— Appraisal problems still exist. An appraisal came in yesterday $55,000 below contract price. Anything under $250,000 is almost flying off the shelf on the west side of town. More $300,000 and up listings are selling. Buyers and sellers are calling our office for more information regarding current listings and to list their homes with Coldwell Banker.

Without a doubt, locally what continues to push our market in the right direction is the $8,000 first time home buyer tax credit. Currently in Washington D.C., real estate industry representatives and government officials are lobbying for either a $15,000 all home buyer tax credit or at minimum, an extension of the $8,000 first time home buyer tax credit but the result of that debate is still in the air. If the tax credit does disappear we are likely going to see an emergence of investors in the first time home buyer arena which may cause problems with housing prices and a continued erosion of the first time home buyer market. Please contact your local representative to call upon his/her support of this important initiative.

Next week I will release the October edition of Reality Check. This month’s edition will feature a Q&A from me on the local housing market and what we may expect for 2010.

Until then,
Make it a great week,

Chris Mygatt
Coldwell Banker Residential Brokerage Colorado

“The patient is out of intensive care, but still has a very long road ahead to a clean bill of health.”

Those were the words last week from Fannie Mae Chief Executive Officer Michael Williams. The CEO went on to say, “Anyone looking objectively at the economy and the housing market sees hope.”

Another good solid indicator of what I’ve been saying in my weekly updates. The U.S. housing market still has a long road ahead but we are making some definite moves towards a housing recovery. So what’s the challenge? Well for starters, rising unemployment numbers aren’t helping. The United States Department of Labor reported in its September 4 Economic Situation Summary that the number of unemployed persons increased by 466,000 to 14.9 million and the unemployment rate rose by 0.3 percentage point to 9.7%. Just to give you an idea, since the recession began in December 2007, the number of unemployed persons has risen by 7.4 million, and the unemployment rate has grown by 4.8 percentage points.

We also need to couple that with the challenges in the mortgage industry. Bloomberg reported, “The mortgage market is still dependent on government-affiliated programs, with private banks providing just 10 percent of loan liquidity, down from about 60 percent in 2006. Fannie Mae and Freddie Mac are responsible for about 70 percent of all new mortgages, while the Federal Housing Administration accounts for about 20 percent.”

Before we can be truly reformed, we need to get into a position where there is more of a balance between private bank loans and Fannie Mae and Freddie Mac loans. In all actuality, we probably won’t see that for some time.

Having said that, U.S. mortgage applications surged last week with demanding rising to its highest level since late-May as consumers sought to take advantage of the lowest interest rates in months, according to Reuters.

The Reuters article reported, “While home refinancing loans dominated demand, the appetite for applications to buy a home, a tentative early indicator of sales, hit its highest level since early January. The overall trend bodes well for the hard-hit U.S. housing market, which has been showing signs of stabilization.”

The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications which includes both purchase and refinance loans, for the week ended September 4 increased 17.0 percent to 648.3, the highest level since the week ended May 29.

These are all very positive indicators that showcase that we are on the right track…it’ll probably be a slow track…but we’re on the right one.

Now let’s take a look at this week in real estate—please excuse the light reporting week—many of us are Riding the Range in support of Coldwell Banker’s Community Fund!

• Boulder/Longmont—The Boulder office reported only minor changes in the Boulder County market over the past week. New listings were down a little (about 5%), under contracts and closed down a little (about 6%), probably due to end of month closings in August , more than a market shift. Showings for our office down 12% for the week, well within normal weekly fluctuations. The week's good news is for the year through August our listings have sold at 98.35% of asking price versus 96.34% for the MLS average. Since our average price for that period was $435,000, sellers in Boulder County put $8,734 more in their pockets when they listed with us!
• Evergreen/Conifer—No information reported.
• Denver Central – No information reported.
• Devonshire— No information reported.
• Douglas County—Our Southwest Metro office reports s showings were down this past week. We did have several successful open houses and we had several listings that went under contract within three days. Agents are busy with buyers and sellers. One of our Agents had three listings go under contract in one week and we are seeing listings moving. The majority of the buyers are looking at homes $300,000 and less and we are seeing buyers ready to take advantage of the $8000 credit before the deadline.
• El Paso County—Colorado Springs reports activity is still very steady with showings increasing only slightly. First time buyers are getting more serious since they have to close before Nov. 30th in order to take advantage of the tax credit. We're also watching the possibility of changes in the tax credit deadline and terms as well as the lifting of the moratorium on bank owned properties.
• Larimer County—The Fort Collins/Loveland offices reported showings are down pretty significantly and it looks as though there are not a lot of homes coming onto the market currently. Recent stats from Weld & Larimer counties report that over 80% of the year to date home sales are below the $300,000 price point. This lower price point allows for excellent rates on FHA financing with as little as 3.5% down & many 1st time home buyers are taking advantage of these great rates. The super hot price point in Fort Collins & Loveland are homes priced around $200,000. We are seeing homes in good condition and in near this price selling relatively quickly and many are selling at list price with competing offers.
• North Metro—No information reported.
• Parker— After a very active summer, we are now seeing a decline in activity on the sales and showings as well as new listings coming on the market. Great effort is put into the initiative to extend and expand the tax credit for home buyers.
• Southeast Metro—As we move into the fall, business is steady and we have seen an increase in the number of properties selling. Our average number of showings before a listing goes under contract has dropped from 26 to 22. This is a great indicator that there are serious buyers out there! We're seeing fierce competition for homes under $225,000, with many selling above list price. Luxury homes are seeing a slight increase in traffic as 10% of our Previews homes are currently under contract. We'll close over 140 transactions this month and are confident about a strong 4th quarter.
• West Lakewood—No information reported.

I did want to let you all know that I will be taking next week off of Weekly Market Watch but I will return the following week with another robust edition.

Until then,
Chris Mygatt
Coldwell Banker Residential Brokerage Colorado

“Yes, the housing market has rarely looked better.”

That was the headline in a September 2 The Wall Street Journal article. Click here to access it: http://online.wsj.com/article/SB10001424052970204047504574386802310702622.html. This was a really interesting piece which looked at numbers from Standard & Poor’s and NAR.

Following is an excerpt from the article:

“Last week, Standard & Poor's reported that its S&P/Case-Shiller U.S. National Home Price index of real-estate values increased this past quarter over the first quarter of 2009, the first quarter-on-quarter increase in three years. Its index of 20 major cities also rose for the three months ended June 30 over the three months ended May 31, with only hard-hit Detroit and Las Vegas experiencing declines. The week before that, the National Association of Realtors reported that sales volume of existing homes was up 7.2% in July from June.

In short, the data suggest that real-estate prices hit a bottom some time during the second quarter, and have now begun to rise. There's no way to be certain that this marks the end of the long, painful correction that followed the real-estate bubble, but clearly prices are no longer in free-fall. That means if you've been sitting on the fence, it's time to act.

Ordinarily I'd never try to time the real-estate market, but I can understand why buyers have been cautious. Few want to buy in down markets, just as stock buyers avoid bear markets. And for most people, of course, buying a house is a much bigger decision than buying a stock. But with real-estate prices nationally now down about 30% from their 2006 peak and showing signs of turning up, the prices aren't likely to go much lower. Every real-estate market is local, and so there may be a few exceptions. Overall, though, I can't imagine a better time to buy than now.”
This of course is what I’ve been saying for some time and it is nice to see it in black and white in a reputable publication like The Wall Street Journal. The fact is, while we may have a long road ahead, we probably have hit bottom and if you were considering buying you probably should consider acting now before it is too late.

And with that said, let’s take a look at this week in real estate:

• Boulder/Longmont—The Boulder office reported the big dip in Boulder county numbers didn't last long, with sales now up 16% during the first week of September over the last week in August. New listings were up by 14% so there's a win in the lower inventory department. No sign of a big end of slowdown either. Showings were up 6.5% week over week too. Still, lots of confusion amongst Agents out there about when to use the foreclosure contract & the meaning of MEC vs SSA. We just keep hammering home the difference, one deal at a time. The Longmont office reported showing activity is very steady week over week. A good sign considering the weeks involved were a part of the Labor Day holiday. Homes that went under contract were up 33% over last week and that a yearly high for "under-contracts" in a single week. The price is still a huge indicator of activity. Most homes shown are under $250,000. Higher priced homes are seeing a slower increase in activity. Slower is better than faster. The final push for the $8000 credit for 1st time buyers.
• Evergreen/Conifer—Evergreen reported we had a total of nine new listings for the week. Five listings went under contract during the past two weeks. There were four local buyers plus one cash buyer from Texas. Four buyers went under contract. All were local. There were a total of 77 showings during the week. Conifer reported we had only one new listing during the week. Two listings went under contract, one bank REO and one private seller. No buyers were put under contract. Showing activity decreased to 27 during the week possibly due to the holiday weekend.
• Denver Central – There has been an increase in first time home buyers looking for property and wanting to take advantage of the $8000 tax credit. With the deadline (November 30th) fast approaching, the possibility of an extension not occurring buyers are going to have to select a property within the next 30 days to take advantage of the credit. The Denver real estate market continues to get positive national and local press on a weekly basis. We are very encouraged and excited about the future of real estate in Denver. Showings are continuing to increase which is a positive sign for this time of year. We are seeing appreciation of home prices in several neighborhoods. The lower-end market has certainly shifted to a seller's market with properties moving quickly. Properties that are priced aggressively are seeing multiple offer situations. We're also seeing an increase in cash offers on homes in the area. Many properties in the lower end go under contract within days of being put on the market.
• Devonshire— As we have seen in recent years, August was a bit slower than July. We're looking forwrad to the September rebound as kids are back in school and parents can concentrate on the business of finding the right home and getting settled before the holiday season. There are buyers just waiting as seen by the two homes that we were able to put under contract just by talking about new listings in our weekly business meeting. Any sellers who are thinking about getting their homes on the market should act now. Don't miss this window of opportunity. We're still seeing the upper end home sector not seeing too much activity but we're confident that this well change within the next several months & most certainly as we move into 2010. At Devonshire, we are looking forward to a busy and successful future.
• Douglas County—Our Southwest Metro office reports showings have been steady even during the long holiday weekend. We had three listings with multiple offers and several of our Agents on the buy side. Open houses were good this week & we also had two clients walk in to our office needing help in finding a home. The homes again are selling in the $250,000 to $300,000 range & we're seeing activity from buyers wanting to take advantage of the $8000 credit before November 30th. We're seeing good results from all of the positive news regarding the Denver market.
• El Paso County—Colorado Springs reports sales and showing activity has decreased slightly and we expect this trend to continue for the next several weeks. We still see a good number of new listings come on the market, therefore causing an increase in listing inventory. The currently low interest rates help to keep the sales activity on a good level.
• Larimer County—The Fort Collins/Loveland offices reported summer is coming to a close, kids are starting school & real estate is settling down. Showings saw a slight bump up from the end of last month, but nothing substantial. The good news is that there are fewer homes on the market and this means less competition for sellers in this already tough market. We have had a few bright spots this last week. Two agents put homes under contract in less than a week & sellers are motivated are motivated to look at quality offers from buyers. In addition, investor clients are realizing we may be near the end of the road on really good investment deals. They are looking to make a move before the end of the year. Finally, we have less than 90 days left to take advantage of the $8000 1st time home buyer tax credit. Get out there and get that new home before this money goes away for good!!
• North Metro—No information reported.
• Parker— It looks as if these are the last weeks of high sales activity before the seasonal slowdown during the fall. The number of new listings as well as showings have decreased already. For the serious seller the time to list homes and get them sold quickly for top dollar is running out!
• Southeast Metro—No information reported.
• West Lakewood—Our Agents are excited about this market. Two listings, one on the market for eight days and another on the market for 42 days both received full-price offers. The price ranges were $250,000 and $375,000. Show condition is very important. If the home doesn't show well, it is much less likely to receive an offer. Sellers need to spend the money & take the time to update their home, stage it & spend some time doing so. Out of state buyers take longer to make a decision. Sometimes it takes tens of homes before they understand our current market.

This week I’ll leave you all with the reminder that the $8,000 federal tax credit for first-time homebuyers is scheduled to expire on December 1. However, in order to qualify, the transaction must be closed on or before November 30, essentially leaving first-time buyers with less than three months to complete the process.

While the urgency of trying to find and close on a home before the deadline may seem stressful, it doesn't have to be. Just contact your Realtor today and they can walk you through the process or visit us online at ColoradoHomes.com.

Until next week,
Chris Mygatt
Coldwell Banker Residential Brokerage Colorado