Real Estate Archives | Fort Collins Homes

Game-Changing Real Estate Trends in 2018

From housing inventory to price appreciation to generational shifts, look for real estate markets to “reshape” in 2018, according to the National Association of REALTORS®.

Game-changer #1: Supply finally catching up with demand

After three years of a shrinking supply of homes for sale, the realtor.com economists predict that the shortfall will finally ease up win the second half of 2018.

“The majority of the year should be challenging for most buyers. But we do expect growth in inventory in the fall,” says Danielle Hale, chief economist for realtor.com.

If housing inventory increases as predicted by fall, that will be the first net inventory gain since 2015.

Bullish construction is the engine that’s turning this ship around, bringing new home inventory to the market and creating opportunity for people to trade up into new homes.

But first time buyers may have to be patient for a while longer.

“Overall, prices are expected to increase, and we’re expecting to see more of that in lower-priced homes,” Hale says.

Along the Front Range, appreciation for homes priced above $750,000 will slow down while homes priced less than $500,000 will continue to see appreciation but not at the rate seen in recent years. This is due to the lack of supply (many builders are focusing on higher price point properties) and a large demand for real estate as a result of continued net migration.

Game-changer #2: Millennials starting to come into their own

The housing market in 2018 will continue to present challenges for millennials but there are some bright spots on the horizon.

Because of the strengthening economy and their developing careers, millennials are taking on larger mortgages and bypassing entry level homes.

As millennials reach their 20s to 30s when they’re settling down and starting families, they’re particularly motivated to buy. Millennials could make up 43% of home buyers taking out a mortgage by the end of 2018, up from an estimated 40% in 2017.

With mortgage rates expected to increase during 2018 due to stronger economic growth, millennials would be wise to buy sooner than later.

Game-changer #3: Tax reform

The new tax plan will change things up, in a nutshell causing short-term rates to rise more rapidly than anticipated as the Federal Reserve seeks to “get ahead” of possible inflation. The tax plan will also flood the market with a little more liquidity, keeping the economy moving at least another year.

Sources: Glen Weinberg, www.cobizmag.com, Cicely Wedgeworth, www.realtor.com

Give our office a call to discuss your real estate plans for 2018!

6 Questions to Ask
When Considering Selling

These 6 questions will help you decide whether you’re ready for a home that’s larger or in a more desirable location. If you answer yes to most of the questions, you may be ready to move.

1. Have you built substantial equity in your current home?

Check your annual mortgage statement or call your lender to find out how much you’ve paid down. Usually you don’t build up much equity in the first few years of your mortgage, as monthly payments are mostly interest. But if you’ve owned your home for five or more years, you may have significant, unrealized gains.

2. Has your income or financial situation changed?

If you’re making more money, you may be able to afford higher mortgage payments and cover the costs of moving. If your income has decreased, you may want to consider downsizing.

3. Have you outgrown your neighborhood?

The neighborhood you pick for your first home might not be the same one in which you want to settle down for good. You may have realized that you’d like to be closer to your job or live in a different school district. Call one of our real estate experts to discuss what would be a good fit for you!

4. Are there reasons why you can’t remodel or add on?

Sometimes you can create a bigger home by adding a new room or building up. But if your property isn’t large enough, your municipality doesn’t allow it, or you’re simply not interested in remodeling, then moving to a bigger home may be your best option.

5. Are you comfortable moving in the current housing market?

If your market is hot, your home may sell quickly and for top dollar, but the home you buy will also be more expensive. If your market is slow, finding a buyer may take longer, but you’ll have more selection and better pricing as you seek your new home. Give one of our realtors a call with questions about our local market!

6. Are interest rates attractive?

Low rates help you buy “more” home, and also make it easier to find a buyer for your current home. Is the effort and cost of maintaining your current home becoming difficult to manage?

Source: RealtorMag.realtor.org, 2016

Colorado Population is… Growing!

You sense it when driving or looking for a home to buy or rent. And, you are right! 100,000 people are estimated to have moved to Colorado between July 2014 and July 2015, according to US Census Bureau data released in December 2015. The Colorado population is now estimated at 5.4 million. Since 2010, Colorado’s population has increased by 408,000, ranking 7th in the US for total population change, and adding more residents than the population of Larimer County. Natural population increase (births and deaths) represented 32,000 of the recent increase, and the remaining 68,000 came from net migration — more people moving into the state than leaving.

Why is Colorado population increasing?

Low unemployment: The Colorado unemployment rate hit 3.6 percent in November 2015, compared with 5 percent nationally, according to the US Bureau of Labor Statistics. Colorado was among the top 5 states in 2014 for job gains. Although job gains have decreased since 2014, the population is expected to see another 100,000 increase in 2016.

Legalized marijuana: Commercial brokers and marijuana enthusiasts in the Denver area point to the marijuana industry as a source of increasing population. Millennials are attracted by the legal access to pot, and out-of-state entrepreneurs see opportunities to benefit from the growing industry.

The same reasons many of us moved to Colorado: the mountains, year round outdoor recreation, job relocation, arts and culture, and a diverse economy (think aerospace to craft breweries).

How Does Increasing Population Affect Real Estate?

Increased housing costs: The cost of housing in post-recession Colorado has increased dramatically. Consumers face strong competition both for rental housing and home purchases, driving rental rates to unaffordable levels for many families, and creating price “bidding wars” for buyers. Increased housing costs also reflect the lack of affordable entry-level housing.

Lack of housing: The amount of available housing has been outpaced by new household formation in recent years. In 2015, household formation was estimated at 45,300 while new housing units were estimated to be 25,000. New construction dropped significantly during the recession and still has not returned to pre-recession levels. As of July 2015, only 2% of new construction was available with pricing affordable to middle-class Coloradans. One impediment to entry-level condo development in Fort Collins and beyond is the state’s construction-defects law that allows condo owners to sue developers over construction defects, and created a shift to luxury priced housing. In 2015, proposed legislation in Colorado was drafted that would encourage condo development by changing current laws. However, the legislation failed, leaving an unresolved and ongoing challenge for entry level housing inventory.

Solutions?

From the state (www.housingcolorado.org) to the local level (http://www.fcgov.com/socialsustainability), affordable housing groups are actively pursuing needed policy changes and legislative action to address challenges facing the real estate industry as our population continues to increase.

Sources: The Prowers Journal; Kathie Barstnar, NAIOP Commercial Real
Estate Development Association; Elizabeth Garner, The Denver Post
Business; Arielle Milkman, New Republic

Want more information?

Colorado Population | census.gov
Colorado Population in the Last 12 Months | DenverPost.com
What Drives Real Estate? | Investopedia.com

Real Estate During The Holidays

It’s common knowledge that most people are advised to get their home on the real estate market in late spring or early summer as that is ‘real estate season.’ While the majority of homes do sell in the spring and summer, listing your home or looking for a home during the holidays or in the winter is not as taboo as some would lead you to believe. There are actual benefits to listing or looking for real estate during the holidays, and if you’ve missed out on the real estate scramble of the spring and summer, starting a home search or listing your home now might just be in your best interest. Here are some of the top reasons why you shouldn’t avoid listing your home, or looking for a home, during the holidays.

Buyers Never Stop Looking

Many would lead you to believe that the real estate market comes to a complete stand still during the holidays or in the winter, but that’s not the case. Every state’s real estate market is thriving year-round, and that even includes during the holiday season. Serious buyers never stop looking, and a serious seller (or a seller that wants or needs to sell their property) will keep their home or property on the market all year long. The holidays bring out the buyers and sellers that are determined — they need something or want to sell now, and they’re not willing to wait for the spring or summer.

Many people with school-age children want to wait to buy a new home when their kids are not in school, but the reality is that a family or anyone looking for a new home can move at any time of the year. Perhaps if you’re in an area with inclement winter weather, you might want to put off your search or move until better weather arrives, but for those that live in a mild climate, moving in November or December is just as easy as moving in May or June. Buyers can also sign up for new listing emails, which alert them to whenever a new property has come on the market, and sellers have the ability to sign up for sellers reports, so they can stay on top of the market in their neighborhood.

Inventory and Competition

While it is known that home inventory is largest during the spring and summer months, the MLS always has homes and properties listed on it. Fall and winter will have properties available, but the number of properties will be lower. Unless you’re totally transfixed on a certain home, or you have a list of needs and wants a mile long, you can be sure to find a property that will fit your housing needs throughout the year.

Despite the fact that inventory will be lower in the fall and winter, people still list their homes, especially if they are serious sellers. While the market is slower, it also is less competitive in terms of other buyers looking for homes. It’s likely the fall and winter won’t create scenarios of multiple, high dollar offers on one property; buyers and sellers alike will have more opportunities to actually think about offers, and especially for buyers, low competition guarantees that you’re not making a rushed or rash decision based on emotions or other offers when you do find the perfect property.

Affordability

This is specifically for buyers, but it’s widely known that home prices slightly fall in the fall and winter when the market has cooled down and more serious sellers are keen to get a sale. This is mostly because real estate sales are seasonal. But that’s not to say if you list your home in the fall or winter you’re going to have to drastically slash the price in order for your property to sell. While it might sit on the market a little longer than it would in the spring or summer, fall and winter sales happen, and if you’re a serious buyer or seller, you know you’ll want to do all you can to make your dream of buying or selling a home a reality.

Homes Look and Feel Charming

You’ll see a lot of articles on how to spruce up a home to ready it for the real estate market, and while the tips are definitely valuable, it’s not a secret that many people decorate their homes over the holidays. There’s something warm and inviting about a decorated home, or a home that feels cozy, and people who list their homes in the fall and winter can take advantage of a fireplace or wood stove to make a room more inviting.

If your property doesn’t have a fireplace or wood stove, you can use candles and other things to make the home smell inviting to buyers. While it may seem cumbersome to sell a property during the holidays or in the winter, you do have some ways to play up the season. And if you are truly set on avoiding the holidays, you can always put it on the market the first of January, when the chaos of the holidays is over.

Check out these sites for more Information about real estate during the holidays!

Top 10 Tips for Selling Your Home During the Holidays

Buying a Home During Holiday Season

Staging Tips for Selling During the Holidays

Why Use A Real Estate Agent?

Buying or selling a home seems to be a way of life for a lot of people in today’s world. When you buy, you definitely want to get the most for your money. Many people think they can go it alone when it comes to buying or selling a house, and it’s definitely true that some people are able to handle all the details of buying and selling a home or property, but in reality the real estate process is intricate and requires a lot of knowledge about the local real estate market, contracts, escrow, appraisals and referrals. While some home owners and buyers are in a position to go it alone, for those intimidated by the market or those who don’t have the time or energy to sell or buy a home on their own, here are some reasons why it’s a smart move to use a real estate agent during your next real estate transaction.

Local Expertise

You’ve lived in an area for some time – but while you may know about local amenities and activities, do you have a lot of knowledge on the local real estate market? Real estate agents know their markets: they know how much homes are selling for, they know what areas are highly desirable and they know which ones are up-and-coming. You can trust an agent to know the local inventory and know how to get the best price for a home or property.

Access

Real estate agents have a number of access points that a regular buyer or seller doesn’t. They have access to listings before they are put in the MLS, and they have access to the homes! Many sellers are only willing to grant access to agents, which means that most buyers going it alone can only access homes during open houses. An agent working for the seller is only going to provide information with the seller’s best interest at heart, so when you go it alone you might be only getting partial information from any questions you may have. Working with an agent will help provide private access to homes, and an agent will be able to get more information from the seller’s agent.

Experience

Buying a home is an intimidating experience – you’re making one of the biggest financial decisions of your life. As a buyer, you want to make sure stress and emotions don’t get the better of you, especially when it comes to making important decisions. Real estate agents know what buyers and sellers go through – they’ve been there, as it’s more than likely they too have made a real estate purchase of their own. While they have personal experience, they also have an experienced rational eye when it comes to the business portion of a real estate transaction. They possess clear judgement, and agents are a seller and buyer’s biggest advocate for a successful negotiation. Real estate agents have the experience, knowledge and acumen to make the process as smooth and stress-free as possible.

Connections

The real estate transaction process requires a number of professionals and services. From a lender, home inspector, contractors and handymen for repairs, lawyers, and a number of other professionals and tradesmen, knowing the right people is beyond important when you want to have a smooth and successful transaction. Real estate agents are in the business, and their past experience has provided them with a number of respectable and dependable contacts and referrals than you’ll find asking friends and family. A ready agent will come prepared with connections and people they are willing to refer because they’ve worked with them in the past and they know their track record. When you choose to work without an agent, you sacrifice the networking that naturally comes with being a real estate agent.

No Cost When Buying

If you’re searching for a home or property to buy, having an agent is free. An agent’s commission is paid by the seller, but most buyers don’t realize this and entertain the idea of going without a Realtor during their home search. If a seller pays the commission, there is no loss to a buyer to take full advantage of all the services a real estate agent offers. It’s also important to understand that even if you choose to go it alone when buying a home, you do not receive the commission a buyer’s agent would. Commission rates are negotiated before the final sale and are included in the contract, meaning if you don’t use a buyer’s agent, the entire commission is paid to the listing agent.

Documents and Paperwork

Unless you’re working with a brand new agent, most agents know the ins and outs of all the documents and paperwork required for a home sale or purchase because they’ve been through a number of transactions. From finding the comps of your market and drafting a purchase agreement, to contacting any other agents and the title company, a real estate agent will be able to provide help in the forms of knowledge, time and resources during the real estate transaction process. Agents also know the important parts of an offer or contract, especially when it comes to line items that could cost a lot in the end or things that are negotiable. Having an agent that knows the process, the paperwork and the documentation is a valuable asset when it comes to making one of the biggest decisions of your life.