Nancy Mikoda

Need Help for Repaying the Home Buyer Tax Credit?

nancy — Fri, 03 Feb 2012 18:00:06 +0000

When the first-time home buyer tax credit was enacted in 2008, in the aftermath of the housing crisis, it was structured as a no-interest loan and taxpayers who used it had to pay it back over time (in annual installments through your tax return). In 2009, the credit was amended to eliminate the pay-back requirement. If you have decided to rent you home out or need to moveprior to the three (3) years agreed upon, then you need to reeed this and understand the consequences.

First-Time Homebuyer Credit Lookup Tool

To help 2008 and other borrowers who have to pay back the proceeds of that credit, the IRS today released a “tool” to help make that process easier, the First-Time Homebuyer Credit Lookup Tool.

In essence, the tool simplifies the gathering of information you need to include the proper pay-back amount in your federal tax filing:

Balance of your first-time homebuyer credit
Amount paid back to date
Total amount of the credit received
Annual installment repayment amount

Prior to release of this tool, taxpayers had to gather this information themselves for reporting on IRS Form 5405. Now it’s available through the IRS by punching in your Social Security number, date of birth, and some other identifying information.

Who else besides 2008 credit users need to pay back their benefit? The IRS says those who used the credit in 2009 or 2010 and then sold their home within three years of purchase. (Under the program, you have to own your primary residence for three years after you take the credit to avoid the pay-back rule.)

You can get more on the rules and the new look-up tool from the IRS.

Access IRS Form 5405.

Access instructions for IRS Form 5405.

Information gathered from article On February 2, 2012, in Breaking News, by Robert Freedman

The Eternal Delemia – Pay off Your Mortgage Early or Investing?

nancy — Fri, 04 Nov 2011 14:37:22 +0000

Is it better to pay off your mortgage early or should you put your money into investments or even income property? This is a topic that can be debated no matter what the market is looking like and there are many sides to the debate.

Paying off Your Mortgage Early

Anyone who lived through the depression has felt the need to pay off their mortgage, which is really a peace of mind issue. Once you’ve paid it off, you can wake up in the morning and know that you have a home for all time that is 100% yours. This sense of security maybe the most important financial decision that can provide you the satisfaction that a lot of investment planning does not. It can also be a great asset that you can tap into to get an equity line of credit, a reverse mortgage, or to use for future unplanned expenses.

Looking beyond the comfort and security of paying the mortgage off early, it can also enabling you to focus your money in other directions. After retiring, you may not need as much retirement income to support your lifestyle. You also may not need the tax deductions that are great when you are in your high earning years. Although you will still have taxes, insurance and maybe even an HOA to pay, this is far less than the burden of a mortgage.

Why Investing is Better than Paying off your Mortgage Early

By paying off your mortgage you will reduce the amount of money you can put into other investments. Look at the amount of return you are getting vs. the amount of interest on your mortgage. Analyze the return rates and you may see that your return is less than the interest on the mortgage. There is also the effect of inflation if we start heading in that direction again. As the value of the dollar goes down, future mortgage payments will effectively cost less than they do now.

Buying investment property cheaply now can give you added income and the tenants actually pay the mortgage off. Right now with inexpensive homes, you can cash flow an investment giving you added dollars to pay off either your home or investment property.

The Compromise

You can do a little of both and depending on market conditions you can invest a little more heavily in investments or paying down debt according to your comfort level at the time. Now maybe a good time to refinance your mortgage to get a lower interest rate or start a 15 year mortgage on your home. You can also pay your mortgage every 2 weeks which pays down the debt in 7 years less time than the monthly payment plan.

You may want to invest in rental property to give you added tax right offs and increased income to put into retirement accounts. Maximizing retirement accounts while you are in your peak earning years is a great plan. Try adjusting your life style so you don’t have to live off of everything you earn. Reduce expenses by analyzing your bills every six months and see if there is a way to cut costs.

Every person has a strategy that feels best for them. Listen to the experts and then decide what is best for you and your future. It is never too late to start.

Decorate your Home for Halloween – Cheap and Quick!!

nancy — Tue, 25 Oct 2011 02:09:29 +0000

Here’s 5 quick, creative, and cheap ideas to decorate your home for Halloween. Halloween comes next week and here are a few tips to help you get your home ready in a jiffy:

Decorate for Halloween

1. Lighting change – Replace your home’s outdoor lights with orange light bulbs for a festive Halloween look. You can also buy some orange ot purple Halloween string lights to hang near or around your front door. Check out some of the local stores for creative lights like bats or cats to string up in the trees like you would do for the holiday season. Lights are also great around your windows or porch to let the children know you are ready for them.

2. Use old Halloween costumes by creating a few festive scarecrows by stuffing past year’s Halloween costumes with straw and prop up in your yard or pose in a chair. Stuff an old pillowcase with straw to create the head and draw a face with marker or paint. You can also use them inside windows to look as though they are peaking out and looking to frighten the trick and treaters!

3. Use pumpkins & gourds – If you are not up for the time and mess of pumpkin carving, buy an assortment of pumpkins and gourds and draw faces on them with markers or craft paint. It’s a great craft for young kids too. There is always multiple uses for these at Thanksgiving so add some straw bales and/or some cornstalks that can take you through the fall and Thanksgiving season.

4. Give masks new life – Use masks from Halloweens past as decorations for your front door or entryway windows. Back-light them to make them extra spooky. Old sheets can be stuffed and made into ghosts or you can use smaller white garbage bags and stuff the head, put a string around the neck and hang them from a leafless tree!

5. Light your walkway – Use clean, gallon milk jugs to create ghost lights by using a black marker to draw a ghost face on each jug. Fill each jug about halfway with white Christmas lights, which can be strung between the jugs. You can also use the luminaries for Christmas and change up the lights to orange and purple to give them a different effect and using them for another season of fun.

Remember to keep everything well lit and safe going up to your doorway especially with groups of children so they do not stumble or fall. Give the walkway and the door landing as much opoen space as possible. Let your imagination go and remember what you enjoyed as a kid!

Buying real estate a better deal than renting in 74% of major US cities

nancy — Sat, 10 Sep 2011 23:39:00 +0000

Buying real estate continues to be cheaper than renting in the vast majority of major U.S. cities, according to a quarterly rent vs. buy index from real estate search and marketing site Trulia. This index compared the median list price and the median annualized rent on a two-bedroom apartment, condominium or townhouse in the country’s 50 most populous cities. According to the index, the cost of buying was less than renting in 37 of the 50 cities (74 percent) as of July 1, 2011. About the same share, 78 percent, favored buying over renting in Trulia’s last index report, released in April.

The total costs of home ownership include “mortgage principal and interest, property taxes, hazard insurance, closing costs at time of purchase and ongoing (homeowners association) dues and private mortgage insurance, where applicable. It also includes an offset for the tax advantages of home ownership, including mortgage interest, property tax and closing cost deductions.” Currently, many aspiring homeowners are on the fence about renting and buying in today’s market. Should they take advantage of falling home prices and low borrowing costs, or should they continue to rent until the economy stabilizes?” said Ken Shuman, spokesman for Trulia, in a statement.

“Price alone should never be the sole factor in deciding to purchase a home. Instead, buyers should first ask themselves if they plan to live in the home for at least seven to 10 years, could make monthly payments on the house, and have enough cash in the bank for a down payment and an additional six to eight months worth of mortgage payments. “If you can answer ‘yes’ to each of these questions, then the cost of buying a home definitely outweighs renting in most cities.”

A price-to-rent ratio of 1 to 15 means that it’s much cheaper to buy than to rent in a particular city. Las Vegas, Detroit, and Mesa, Ariz., most favored buying among major cities.

Top 10 cities to buy vs. rent:

Rank	City	State	Price-to-rent ratio
1	Las Vegas	Nev.	6
2	Detroit	Mich.	7
3	Mesa	Ariz.	7
4	Fresno	Calif.	7
5	Arlington	Texas	8
6	Sacramento	Calif.	8
7	Phoenix	Ariz.	8
8	Jacksonville	Fla.	8
9	San Antonio	Texas	10
10	Tulsa	Okla.	11

A ratio between 16 and 20 means that it’s more expensive to rent than to buy, but buying may be better than renting “depending on personal circumstances, such as one’s tax bracket,” Trulia said. Any ratio above 20 indicates that owning is much more costly than renting in a city. According to the index, renting was much cheaper than buying in six cities: New York; Fort Worth, Texas; Omaha, Neb.; Seattle; San Francisco; and Kansas City.

Top 10 cities to rent vs. buy:

Rank	City	State	Price-to-rent ratio
50	New York	N.Y.	36
49	Fort Worth	Texas	32
48	Omaha	Neb.	27
46	San Francisco	Calif.	24
47	Seattle	Wash.	24
45	Kansas City	Mo.	22
44	Portland	Ore.	20
43	Los Angeles	Calif.	19
42	Boston	Mass.	18
41	Memphis	Tenn.	17

Source: Trulia foreclosure hot spots saw their price-to-rent ratios drop in the first half of this year, with Detroit seeing the biggest decline, at 39 percent. Miami, however, was an exception. “A mini buying boom created by foreign investors and foreclosure freezes have caused (Miami’s) price-to-rent ratio to jump by 112 percent: from 6 in January to 13 in July,” Trulia said.

COOL CHART – look for DENVER: http://insights.truliablog.com/vis/rent-vs-buy-q3/… Better to buy!!

http://www.inman.com/news/2011/08/16/buying-real-estate-a-better-deal-renting-in-74-major-us-cities

IRS Tips for Denver Home Sellers

nancy — Thu, 01 Sep 2011 23:39:28 +0000

From time to time the IRS releases tips designed to help people with their taxes. Some of these are quite useful. The agency released “Ten Tax Tips for Individuals Selling Their Home,” (IRS Summertime Tax Tip 2011-15).

As a real estate agent or broker, it is not my job to give home sellers tax advice. Instead, I refer sellers to this list of IRS tips. It’s a good starting place for them to begin to understand this often complex area of tax law. Print it out and hand it to anyone who asks you about these issues.

Here are the IRS’s top 10 tax tips for home sellers:

1. In general, you are eligible to exclude the gain from income if you have owned and used your home as your main home for two years out of the five years prior to the date of its sale. 

2. If you have a gain from the sale of your main home, you may be able to exclude up to $250,000 of the gain from your income ($500,000 on a joint return in most cases). 

3. You are not eligible for the exclusion if you excluded the gain from the sale of another home during the two-year period prior to the sale of your home. 

4. If you can exclude all of the gain, you do not need to report the sale on your tax return. 

5. If you have a gain that cannot be excluded, it is taxable. You must report it on Form 1040, Schedule D, Capital Gains and Losses. 

6. You cannot deduct a loss from the sale of your main home. 

7. Worksheets are included in Publication 523, Selling Your Home, to help you figure the adjusted basis of the home you sold, the gain (or loss) on the sale, and the gain that you can exclude. 

8. If you have more than one home, you can exclude a gain only from the sale of your main home. You must pay tax on the gain from selling any other home. If you have two homes and live in both of them, your main home is ordinarily the one you live in most of the time. 

9. If you received the first-time home buyer credit and within 36 months of the date of purchase, the property is no longer used as your principal residence, you are required to repay the credit. Repayment of the full credit is due with the income tax return for the year the home ceased to be your principal residence, using Form 5405, First-Time Home Buyer Credit and Repayment of the Credit. The full amount of the credit is reflected as additional tax on that year’s tax return. 

10. When you move, be sure to update your address with the IRS and the U.S. Postal Service to ensure you receive refunds or correspondence from the IRS. Use Form 8822, Change of Address, to notify the IRS of your address change.

These tips can be found on the IRS website at http://www.irs.gov/newsroom/content/0,,id=104608,00.html.

http://www.inman.com/buyers-sellers/columnists/stephenfishman/irss-top-10-tax-tips-home-sellers

Five Cheap ways to Improve your Kitchen!

nancy — Fri, 19 Aug 2011 03:33:13 +0000

The good news for homeowners: Consumer Reports’ latest tests yields a tantalizing menu of value-priced kitchen upgrades that cost as little as $1,000. Besides paying off now in improved looks and convenience, these smaller upgrades are likelier to pay bigger dividends later as home prices rebound. Here’s the list:

Add fresh paint

If cabinets are structurally sound but shabby, spruce them up with a coat of paint. Paying a pro costs as little as $50 per door, less if you tackle the prepping and painting yourself. One pick from our tests is the self-priming Behr Premium Plus Ultra Satin Enamel, $33 per gallon at Home Depot.

More from ConsumerReports.org:

The best appliances—and what not to buy

Kitchen planning guide

Consumer Reports has no relationship with any advertisers or sponsors on Yahoo!

Improve convenience

For about $200 or less, you can improve cabinet storage with pull-out shelves and retractable trash bins.

Update the countertops

Designers’ views are mixed between granite and quartz (about $40 to $100 per square foot), which mimics granite and other stone. Quartz topped our gauntlet of tests, and it never needs sealing. Want to spend less? Laminate costs just $10 to $40 per square foot and resisted stains and impact even better (but be careful about cuts).

Beautify the backsplash

Durable ceramic-tile starts at about $10 per square foot installed. And even high-maintenance materials like glass are smart options, since they don’t get the wear and tear of a countertop. Whatever you use for the kitchen backsplash, caulking between the backsplash and countertop is a must.

Fix up your flooring

Tile or wood may impress realtors, but some top-rated vinyl and laminate floors also look sharp, resist wear significantly better, and cost far less when the work is done. Examples from our latest tests include the vinyl-tile Congoleum DuraCeramic Sierra Slate SI-74 Golden Greig, $5 per square foot, and the laminate Armstrong Coastal Living L3051 White Wash Walnut, $3.50 per square foot.

http://shopping.yahoo.com/articles/yshoppingarticles/641/five-dirt-cheap-kitchen-upgrades-that-pay/

5 Things Home Buyers Do That Turn Sellers Off (and Kill Deals)

nancy — Wed, 10 Aug 2011 03:48:39 +0000

On today’s market, every savvy seller wants to know what turns buyers off, so they can get their homes sold as quickly as possible, for as much as possible. But buyers, take note – there is a minefield of seller turn-offs you can trigger that hold the potential to keep you from getting the home you want at the best price and terms, or to unnecessarily complicate dealings with your home’s seller.

If you think all of today’s sellers are under the gun and will just put up with whatever behavior buyers dish out, be aware that there are still many multiple offer situations in which buyers have to compete with each other to get a home – buyers who trigger these turnoffs tend to lose in those scenarios. Also, avoiding these seller turnoffs can create a transactional environment of cooperation and avoid things turning adversarial. That, in turn, can empower you to score a better price, get extra items you want thrown into the deal, and even negotiate more flexibility around your escrow and move-in timelines – all perks that can make your life easier and your budget go further.

For sellers, these turnoffs pose the potential of irritating you out of an otherwise good deal – maybe even the only deal you have!

Here’s a few of the most common buyer-perpetuated seller turnoffs, with tips for sellers on how to keep an emotional (and economic) even keel, even if your home’s buyer makes some of these waves:

1. Trash-talking. Trash-talkers are the home buyers who think they’re going to negotiate the list price down by slamming the house, telling the sellers how little it is really worth, how the house across the street sold for nothing, why the school on the corner should make them desperate to give the place away, etc. This strategy never works; in fact, when you attack a seller and their home, you only cause them to be defensive, and think up all the reasons that (a) their home is not what you say it is, and (b) they shouldn’t sell their home to you!

Sometimes this happens with buyers who actually love a house and just walk around it fantasizing about all the ways they would customize it to their tastes while a seller is there. Sellers: avoid being at home while your home is being shown. Buyers: save your commentary for your agent; if you do encounter the seller in person keep your conversation respectful and avoid critiquing the house or the list price.

2. Being unqualified for mortgage financing. When a seller signs a buyer’s offer, most often the seller agrees to effectively pull the home off the market, forgoing other buyers who might be interested. As such, the only thing worse than getting no offers on your home is getting an offer, getting into contract, then having the whole thing fall apart when the buyer’s loan falls through – especially if that could have been predicted or avoided up front.

Sellers: Work with your agent to vet your home’s buyers’ qualifications, including their loan approval, down payment and earnest money deposit – before you sign a contract. It’s not overkill for your agent to call the buyers’ mortgage pro before you sign the contract and get a level of comfort for how robust their qualifications are. Buyers: Get pre-approved. Seriously. And make sure that you don’t buy a car, quit your job, deposit lottery winnings or do any other financial twitchery between the time you get loan approval and the time you close escrow on your home.

3. Making unjustified lowball offers. No one likes to feel like they are being taken advantage of. And sellers generally know the ballpark amount that their home is worth, as well as what they need to sell it for to get their mortgage paid off. Yes – the price you pay for a home should be driven by its fair market value, rather than the seller’s financial needs, and deals are more available in a market like the current one, in which supply so vastly outpaces demand. But just throwing uber-lowball offers out at sellers hoping one will hit the spot is not generally a successful strategy, especially if you really, really want a given property.

Sellers: Don’t get overly emotional about receiving a lowball offer; counter at the price you and your agent decide makes sense based on the total circumstances, including your motivation level, recent comps and the interest/activity level your listing is receiving. Buyers: Work through the similar, nearby homes that have recently sold (a/k/a comparables) before you make an offer to factor the home’s fair market value into your offer price – also factor in how much you want the place, too. Don’t be amazed if you make an offer far below asking, and don’t get a response.

4. Renegotiating mid-stream. Sellers plan their finances, moves and – to some extent – their lives around the purchase price a buyer agrees to pay for their home. If you get into contract to buy a home, find out during inspections that costly repairs need to be made, then propose a lower sale price, repair credit or even actual repairs to the seller, that’s sensible and fair. But if you were aware that the property needed a lot of work before you made an offer on it, then you come back asking for beaucoup bucks’ worth of credit or price reductions midstream, expect the seller to cry foul. And holding the seller up two weeks into the transaction because you caught a case of buyer’s remorse? Not cool, and not likely to foster the spirit of cooperation you may need to get your deal closed.

Sellers: avoid mid-stream price renegotiations by having a full set of inspection reports and repair bids at hand when you list your home. Buyers: try to avoid renegotiating the entire deal unless you get some major surprises at your inspections or inflating small repairs to try to justify a major price cut.

5. Misleading or setting the seller up. Remember when we talked about buyer turn-offs? Being misled by listing photos or very fluffy property descriptions was high on the list. The same goes for sellers.Offering way over asking with the plan to hammer the seller for a reduction when the house doesn’t appraise at the purchase price? #LAME Making an as-is offer planning the whole time to come back and ask for every penny ante repair called out by the inspectors? Lame squared.

Sellers: If you get multiple offers and are tempted to take a sky-high one or one that claims to be all cash, consider requesting proof that the buyer has sufficient funds to make up the difference between what you think the home will appraise for and the actual sale price, and statements showing the cash truly exists. Buyers: Don’t be lame. I’m not saying you have to tell the seller exactly what your top dollar is, but making offers with terms designed to intentionally mislead is really, really bad form – and can result in losing the home entirely if and when your bluff gets called.

P.S. – You should follow Trulia and Tara on Facebook, too!

5 tips on Buying a Foreclosure in Westminster CO!

nancy — Sat, 02 Jul 2011 02:48:09 +0000

Bargain Bin Shopping

Westminster, CO housing market is competitive and it makes sense that prospective buyers are becoming increasingly interested in foreclosures. After all, some of these properties – which accounted for about 20 percent of home sales in June, by the way – are selling at up to 50 percent less than comparable homes. If you are interested in rummaging through the bargain bin, here’s a primer:

1. Find listings – This is the easy part. You don’t need to show up at courthouse auctions or search through legal filings to find a home in Westminster or other Denver areas. All you need to do is look on sites that allow you to search for foreclosed properties, like http://bit.ly/qVL5Je. Just use the Listing Type search filter to narrow down to these sales. When you are ready to start looking inside, call me at 720-331-2444.

2. Work with a specialized agent – A real estate agent who specializes in foreclosures is not only a time saver, but a necessity. They will guide you through the process, help you find the best properties, tip you off to the various issues/challenges/risk, and do the nitty gritty along the way, from researching property title documents to recommending reputable inspectors and contractors. Westminster, CO may not be the easiest location to find a bank owned home but most of the neighborhoods are now holding their value.

3. Understand your buying options – While you can buy directly from the owner (before they’re officially foreclosed on), or try your hand among the seasoned investors at an auction, the safest way to buy a foreclosed property is to buy it back from the bank (bank foreclosed properties are also called real estate owned, or REOs). That’s because you can inspect the home before you buy it, and you can finance the purchase with a mortgage. Furthermore, when a bank takes back a home, it will clear any outstanding liens. A seasoned Realtor can guide you through the process and show you the neighborhood trends so you can feel confident about your offer.

4. Budget for repairs/renovations – Don’t underestimate the amount of work that may be needed to restore the home to a “livable” condition as these residences are sold “as is.” You can easily factor in 10 percent for updates and repairs on any foreclosed purchase. We also have lists of preferred vendors who have lots of experience with these homes and can give you a bid for a rental or an upgraded version for a homeowner.

5. Make an appropriate bid – Banks aren’t necessarily selling foreclosed homes in Westminster, CO at the kind of fire sale prices you’d find at a pre-foreclosed sale or at an auction, but that doesn’t mean you shouldn’t haggle – particularly if the bank has a huge inventory of foreclosed homes, and the property has sat vacant for some time. Just make sure you’ve done your homework, taking into consideration not only the price, but also the condition of the property, and the surrounding neighborhood. (Ideally, you want to find a foreclosure in a neighborhood that doesn’t have very many of them.) Also, get your financing pre-approved before you bid so you know what your top price and payment will be.

Some material provided by Vera Gibbons who is a financial journalist based in New York City.

Westminster CO Lawn Care Tips

nancy — Mon, 20 Jun 2011 20:43:41 +0000

Westminster Co Top Tips to Save Money on Landscaping

As any homeowner knows, landscaping can cost much more than one might initially expect. You can save money and have a beautifully landscaped home by doing more yourself and with these tips:

1. Hire a consultant – Hiring a landscape designer can be an expensive proposition. Save money by creating and drawing your own plan then hire a landscape designer to review your plan. There are many sites on the web you can go to that will also help you design and visualize what your home could look like with some more foliage. A specialist, as well as books, web sites and your local garden center can help you find plants that will thrive in Westminster CO high plain climate. Try to vary plant size, texture and color to provide an interesting pallet throughout the season. You could even try a Moonlight garden which consists of all white plants that really make your yard pop in the evening if that is when you entertain.

2. Divide and trade – If you like plants and/or trees that your neighbor has, ask if you can divide plants and trade with them. Dividing plants helps out a neighbor whos garden is overgrown. It also gives you a variety that grows well in Westminster. Some older neighborhood have more unique heirloom plants that have been in gardens for generations.

You can also offer to have seed exchanges with neighbors. After plants have bloomed and the flower has dried, you can scatter the seeds in your garden or give them to neighbors who have admired your plantings. What a great way to meet neighbors and interact with your community in Westminster.

3. Buy small – Oftentimes it is less expensive to buy a number of smaller plants than one larger one. Buy smaller, save money and watch your plants grow over the coming couple of of seasons. If you have ever notice an overgrown yard, you can see what happens by buying too many plants or varieties that grow too large for the area you planted them in.

4. Check alternative sources – Do some research to find alternative sources for trees and plants. Some cities and foundations give away free trees. Oftentimes botanical gardens and plant societies have plant sales and giveaways. In some areas, even HOA associations will replace a boulevard tree that has died. At the end of the summer, many garden centers offer trees at deeply discounted prices so they don’t have to carry them through the winter. In Westminster CO, you may need to supplement the natural water as some winters tend to be very dry. You don’t want to lose something after all the work you did to get it planted.

5. Compost – Save money on buying soil and fertilizer by composting. All you’ll need is a small, fenced off area of your yard cordoned off with chicken wire and 2 x 4′s. Garden Centers and even have the pre-made variety. This can save a lot on fertilized and reduces the amount of chemicals in our environment.

6. Use what you have- Work with the plants and trees you already have. If a tree, plant or shrub is not thriving as you like it to, take time to do some research. You can find pruning and plant care advice online or ask your favorite garden retailer. If it is small enough, you can move it to another location in your yard where it can thrive. As folige grows denser, you may not have as much sun light coming to your plants. Pruning or relocation is a great way to change the percentage of sun in your yard.

7. Take a phased approach – Keep in mind that you don’t have to create your dream design all at once. Split your plan into affordable phases and complete each phase as time and money permit. You’ll save money on financing costs and have time to adjust your plan and shop for the best prices as you go along.

Westminster, CO Short Sales and REO’s

nancy — Tue, 14 Jun 2011 22:16:03 +0000

The Westminster CO Real Estate market for the past 4 – 5 years has had it’s share of distressed sales of REO’s and Shortsales. The percentage of sold Shortsales and REO’s in the Metro Denver market has consistently been in the 35% – 45% range as our market has suffered through an unprecedented downturn. While the share of distressed sales is still in the 40% range, the MIX of sales has changed over the past several years. Since 2008 the share of REO properties sold in our market has steadily fallen while the share of shortsale properties has steadily increased.

For example, in 2008 about 1/3 of all sales were REOs but only 10% were shortsales. By 2010, REO’s and shortsales each made up about 20% of the sales. This change in the mix of sold properties reflects the concerted effort of the U.S. government and the large banks to intervene with home owners before their property goes to public sale. Clearly, these efforts have met with mixed results but the data do support that there has been a slow transition away from REO’s and towards shortsales.

So what do we see for the future of the Westminster CO Real Estate Market? The housing market is going through an unavoidable hangover from the go-go days of 2000 – 2006. There is clearly no easy solution to the problem and the more misguided government intervention is foisted upon the market the longer the inevitable recovery will take. Worrying about the market will not help. Dealing with the reality at hand is the only way to proceed. Our market will recover in pricing when demand outstrips supply. Westminster CO has always been a desirable location to live in and as corporations continue to relocate and expand along the I 36 corridor, we will see improvment in the real estate market.

Here is one way we see that happening. The longterm investors who are picking up properties in the under $150k range are buying up everything they can, helping to support this segment of our market. They are taking advantage of a combination of record high home affordability, record low interest rates, reasonable lending guidelines, record low vacancy (1.4%!), and consequently rising rental rates. Never before have we seen a combination of factors that more effectively supports a longterm investor’s goals. As rental rates continue to climb they make home prices relatively more affordable. Already, it is cheaper to buy than rent in many portions of our market, especially under a $200k home price. Sooner or later, renters will overcome their resistance to purchasing a property (brought about by the psychology of the downturn) when they realize they can buy cheaper than renting. This will be one of the main factors that will begin to put upward pressure on home prices. We expect this phenomenon to unfold over the next couple of years.

For more information regarding market trends in Westminster CO or in your neighborhood, check out my Real Estate Stats Tab or call me at 720-331-2444.