Equity Insights

The real estate research firm Core Logic just produced their latest Homeowner Equity Insights report.

Some interesting tidbits:

  • 63% of all properties nationally have a mortgage
  • Homeowners with mortgages collective realized a $428 billion rise in equity over last year, an increase of 4.8%
  • Only 3.8% of all mortgaged properties have negative equity (where the loan is greater than the value of the home)
  • 10 years ago 26% of all mortgaged properties had negative equity
Posted on October 18, 2019 at 1:41 pm
Paul Hunter | Category: Buyer Tips, Friday Fun Facts, Seller Tips

Net Worth

It’s no surprise that for just about every homeowner, their real estate represents the largest portion of their net worth.

Check out these numbers from the Federal Reserve’s Survey of Consumer Finances:

Median Net Worth in the U.S. = $97,300
Median Net Worth of a Renter = $5,200
Median Net Worth of a Homeowner = $231,400

Posted on October 14, 2019 at 2:12 pm
Paul Hunter | Category: Buyer Tips

Big Bounce

Seventy-five major metro markets have seen home prices bounce back to above their pre-recession peaks.

Metro Denver has seen the biggest bounce with home values 91% above its previous high in 2007 , according to the Home Price Recovery Index from HSH.com.

“Aside from routinely strong home price appreciation, it’s important to know that the Denver metro’s housing ‘bust’ in 2008 was relatively short and shallow,” said Keith Gumbinger, the report’s author.

The peak-to-trough for home values was only three years long and the total decline in value was just under 8 percent in Metro Denver, he said.

By contrast, a half-dozen large metros have seen home prices more than double from their lows and still not reach the old highs. On that list are Las Vegas, Sacramento, Calif., and Cape Coral, Fla.

Posted on September 27, 2019 at 12:18 pm
Paul Hunter | Category: Buyer Tips

1 Million

We have our pulse on the high-end luxury market.

The activity in price ranges over $1,000,000 is an effective indicator of the health of the overall market.

If buyers for luxury properties are active, it tells us that “smart money” is confident about real estate in Metro Denver.

So far this year, 1671 luxury properties have sold.  This is 75 more than had sold at this same time last year and 440 more than 2017.

It seems “smart money” is confident.

Posted on September 20, 2019 at 12:34 pm
Paul Hunter | Category: Buyer Tips, Friday Fun Facts, Investment

Rate Bounce

Rates hit near-historic lows this week and are now at 3.49% for a 30-year mortgage.

There have only been two other times in history when rates have been this low- April 2013 and October 2016.

It’s interesting to see what happened soon after bottoming out these last two times.

In April of 2013 rates hit 3.41%.  By August 2013 they had jumped to 4.40%.

Rates bottomed again in October 2016 at 3.42%.  Just two months later in December 2016 they were 4.32%.

Each time the increase was nearly 1% within just a few months.

So, if history proves itself as a guide, we can’t expect these rates to last for long.

Posted on September 13, 2019 at 1:43 pm
Paul Hunter | Category: Buyer Tips

Case-Shiller

The Case-Shiller Home Price Index is a well-known report in the real estate industry and a valuable way to gauge what is happening in various markets across the Nation.

The report tracks home price appreciation in the 20 largest markets in the country.

Their most recent report shows that, Nation-wide, home prices are up 2.1% year-over-year. Last year prices were rising at 6.3%. So, prices are still going up but not as fast as they were.

The city with the highest appreciation over the last 12 months is Phoenix with 5.8% growth followed closely by Las Vegas at 5.5%.

Denver came in at 3.4% which makes it tied for 8th place out of the 20 cities.

Posted on August 30, 2019 at 7:43 pm
Paul Hunter | Category: Buyer Tips, Real Estate, Seller Tips

On Sale

With interest rates so low, one could argue that money is essentially on sale.

It’s actually half off.

30-year mortgage rates hit 3.75% which is exactly half of their long term average.

Rates have averaged 7.5% over the last 40 years so today buyers are getting half of that rate.

The “sale” on mortgage rates creates a significant savings in monthly payment because of the 1%/10% rule.

For every 1% change in interest rate, the monthly payment will change roughly 10%.

So when rates go up to 4.75%, a buyer’s payment will be 10% higher.

For example, the principal and interest payment on a $400,000 home with a 20% down payment at today’s rates is $1,482.

If rates were 1% higher, the payments jump up to $1,669.

Posted on August 9, 2019 at 7:34 pm
Paul Hunter | Category: Buyer Tips, Investment, Real Estate

What We Notice

Here are some observations we have about the market right now:

  • Inventory is up, price reductions are up, the length of time to sell a home is up
  • Seller concessions are more prevalent
  • Sellers are more willing to accept contingent offers (especially in higher price ranges)
  • If a home doesn’t sell within a week, it often becomes stigmatized by the market and potential buyers assume there must be something wrong with it
  • Homes that likely would have sold within hours a year ago, are now sitting on the market
  • Condition is super-important as buyers become even more picky
  • Pricing a property correctly on day one is paramount
  • Sellers who over-price their property are finding themselves chasing the market
Posted on August 2, 2019 at 1:56 pm
Paul Hunter | Category: Buyer Tips, Seller Tips

Homeownership Rate

An interesting stat which can give some insight to the national market is the Homeownership Rate.

It simply looks at the percentage of Americans who own their home instead of rent.

The most recent report from the Census Bureau shows the rate at 64.2%.

Most importantly, this number is showing stability after many years of change.

After many years of hovering around 64%, the Homeownership Rate started increasing in 1996 and reached as high as 69.5% in 2005.

2008 started several years of declining back to the pre-1996 levels of 64%.

So today it’s back to what seems to be “normal” based the long-term average.

Posted on July 26, 2019 at 3:23 pm
Paul Hunter | Category: Buyer Tips, Real Estate

The Scoop – 3rd Quarter 2019

WELCOME TO “THE SCOOP”

Everything You Need to Know About the Northern Colorado Real Estate Market – Produced Quarterly by Windermere Real Estate in Northern Colorado

The 10-Year Rhythm

As we study 40 years of price appreciation data for Larimer County, an interesting pattern emerges.  We call this pattern the 10-Year Rhythm.  It shows that price appreciation in ten-year segments tends to closely mirror the 40-year average of 5.42%.  This demonstrates that our market grows in a steady, predictable way instead of taking wild swings like other markets.

Long Term Home Prices

A trusted resource is the Federal Housing Finance Authority (FHFA) which tracks nearly 300 markets across the country and produces a quarterly price appreciation index.

Larimer County

Weld County

State Ranking

According to the Federal Housing Finance Authority, these are the top 5 states for home price appreciation over the last 5 years:

A Mile High

Did you know our state grows by a Mile-High Stadium’s-worth of people each year?  That’s right, we’ve been growing by about 75,000 people each year, and we will keep growing.  The State Demography office estimates we will have 7.5 million people living here by 2040.

Market Speedometer

Each quarter. our Chief Economist Matthew Gardner produces his economic report for Metro Denver and Northern Colorado. Inside you will find his market speedometer. This speedometer reflects the state of the region’s real estate market using housing inventory, price gains, home sales, interest rates, and larger economic factors.

According to Gardner, “I have moved the needle very slightly towards buyers as a few Front Range counties saw home inventories rise. However, while I expect to see listings increase in the coming months, for now, the housing market continues to heavily favor sellers.”

Rental Numbers

What’s Up With Down Rates

It was only a few months ago when experts predicted that 30-year mortgage rates would hit five percent by the end of 2019. For many, it was a foregone conclusion. At the end of 2018, they were already in the high fours. It appeared as if the low interest rate party was over. Then along came mid-2019 and rates kept going lower and lower. Now they are in the high threes and back to where they were in the fall of 2016. What gives? It turns out that trade tensions between the

U.S. and China have caused concerns about a global economic slowdown which, in turn, have pushed rates lower. Lower rates are of course great news for buyers and people thinking about refinancing.

A Unique Solution

Windermere Listings

 

Posted on July 25, 2019 at 7:29 pm
Paul Hunter | Category: Buyer Tips, Evans Real Estate, Fort Collins Real Estate, Johnstown Real Estae, Johnstown Real Estate, Longmont Real Estate, Loveland Real Estate, Real Estate, Seller Tips, Wellington Real Estate, Windsor Real Estate