2010 Boulder County Sales Recap

The Boulder Area Realtor Association recently posted sales statistics for last month and I thought I’d analyze their sales statistics from last year to give you a general overview of how we’re entering 2011. Be sure to check out the paragraphs at the end of this post to see what this means for 2011. Here are 10 of the most notable data points for last year:

Single Family Homes:

1) Every community in Boulder County had a Median Sales Price INCREASE compared to the prior year, with the exception of Lafayette that had a slight decrease. Whoa!!

2) The wonderful community of Louisville led the way with an 11 percent increase in Median Sales Price in 2010.

3) Average Days to Contract was down across the board with the exception of Erie which increased by 21 percent.

4) The total number of homes sold increased overall with the biggest increase in the Boulder County plains at close to 40 percent. The total number of homes sold in Superior decreased by 15 percent.

5) The Average Sales Price in Louisville rose by 12 percent, followed by rises in Average Sales Price in Longmont at 6 percent and Broomfield at 7 percent.

Condo and Townhomes:

1) The total number of sales was down 7 percent. See FHA note below!

2) The communites most affected by the downturn in condo/townhome sales were: Louisville and Superior in the mid 30 percent range and Lafayette and Broomfield around 15 percent.

3) The Median Sales Price was down less than 10 percent or slightly up across the board. Louisville had the largest decrease around 10 percent. Boulder, Broomfield, and Superior had modest increases of near 5 percent.

4) Average Days to Contract was down in the following communities:  Broomfield 20 percent and Lafayette and Longmont in the mid 20 percent range.

5) Average Days to Contract was up in Boulder by 45 percent, although the Average Sales Price held steady compared to the prior year.

What does this mean for 2011?

This is a very interesting snapshot of the market data for the prior year. It’s quite a positive story that almost EVERY community in Boulder County had a Single Family Residence median sales price INCREASE for all 12 months in 2010. However, the condo/townhome market is getting hurt by the stringent FHA and FNMA owner occupancy rules that are inhibiting a lot of potential buyers (those requiring FHA loans with 3.5% down payment) from entering the market. Read more about this here.

Although sellers that are selling homes in communities above the median price range aren’t generally happy about the sales price, the median and below median price ranges are weathering the storm. Real estate investors are starting to come off the sidelines and are becoming more active. There is also a large inventory of multi-family properties. Multi-family prices, including cap rates and GRMs, are still trending downward. It’s a great time to be real estate investor!

Now, more than ever, it’s important for consumers to engage a Realtor that knows the local market and how it compares regionally and nationally. National real estate news doesn’t often apply to the local real estate landscape, and even within Boulder County, data can vary significantly across the various communities.

Do you have more questions about the Boulder County real estate market? Feel free to start a discussion on our Facebook page!

Reflecting on 2010

As I eagerly awaited the start of the Stellar business year in 2011, I spent some time reflecting on what a great year we had in 2010. Christina and I are very excited about the year ahead and a lot of that excitement is due to the great accomplishments we had in 2010. Here are 10 thoughts as I look back on 2010:

1.       First and foremost, I am blessed and thankful to have such a wonderful family and group of friends that have been so supportive in helping me navigate through some tough times in the past few years. There is power and magic in surrounding yourself with great folks!

2.       I am thankful to work with our wonderful clients who trust us to help them with such an important financial investment.

3.       I am thankful we have such fantastic business partners that help us serve our clients in such a superior manner. What a power team we have!

4.       What an amazing contribution our Stellar Marketing and Operations Manager, Christina Savage, has made to Stellar Properties!

5.       We had one of the best quarters in Stellar Properties history in 3Q 2010.

6.       Our 4Q 2010 was pretty strong as well, and we’ve got great momentum leading up to 2011.

7.       We moved our office to Pearl Street and we’re thoroughly enjoying the change!  Drop by and say hello!

8.       We’ve streamlined our business significantly and we’re reallocating some of the savings to better serve our buyers and sellers in 2011. Great stuff ahead!

9.       We launched our BNI “Boulder Business R.A.I.S.E.” chapter this year and meeting with these folks every week is one of the highlights of my week. What a wonderful group of folks!

10.   My favorite part of looking back at 2010 is the time I spent with my children Nick and Elena. It’s amazing how they make the enjoyment and wonder of the simple things in life such an inspiration in all the other facets of my life.

We’re excited about a great year ahead – onward to 2011 !

10 Lessons I Learned as a First-Time Homebuyer

By Christina Savage, marketing and operations manager

Yesterday I made my very first mortgage payment and let me tell you: it felt so good!

Last month I bought a two bedroom, two bath condo in Gunbarrel. It’s faces southwest, which means I have a partial view of the flatirons, sun in the winter and shade in the summer; it abuts a greenbelt; it’s in a private location; it’s next to a huge dog park and playground; and comes complete with super nice neighbors. I’m diggin’ it.

My just-turned-two-years-old son, Aidan, runs around the condo yelling, “Our new house, Our new house!” Quite entertaining and adorable to say the least.

Because I work for Stellar Properties and I help many of Tony’s buyers, I’m well adept at searching for properties. I had the entire MLS at my fingertips which made it that much easier and faster to find a home. I began my home search looking in Louisville, Lafayette, and Boulder, but eventually narrowed it down to three neighborhoods in Gunbarrel (an area in northeast Boulder). My price range was on the lower end, so I had a fairly small selection to choose from, but I was surprised to find out that I could still buy in Boulder and stay within my budget. I found that narrowing down my search to my favorite neighborhoods really helped me find what I was looking for.

Along the way, I learned 10 important tricks of the trade:

1. Start by getting in touch with a great loan officer who can explain the process to you in simple terms. Although my sister is a loan officer in Maryland, my stepmom is a real estate broker in North Carolina, and I work in the industry, there was so much I didn’t know. A good loan officer will prequalify you prior to your home search. It can be tricky to get a mortgage these days and you want to know you’ve got a very good chance of closing on a loan. Another thing a great loan officer will do is give you a sample of loan model scenarios. You’ll be able to see the differences in monthly payments based on the sales price and down payment. Sometimes you may be surprised that the difference in monthly payments might not be as significant as you thought they would be.
2. Work with a great real estate broker. Tony was my buyer’s agent and he was able to negotiate tooth and nail for me. I felt comforted knowing that if any problems came up, he’d be there as my advocate. A great real estate broker will also set up detailed searches for you. We use a tool that is part of our local MLS called MySite. It automatically searches based on your criteria and regularly sends new searches to your email inbox. You can sort through listings and categorize them so your agent can see what you love and what you don’t.
3. Make a list of must-haves and nice-to-haves. Based on your price range, be reasonable about what you’ll be able to find. Sure, I would have loved a garage; a Viking range; granite countertops; and stainless steel appliances, but those aren’t typical finds in my price range. My must-haves included the HOA allowing my cat; qualifying for FHA financing since I knew that was the loan I’d go with; nearby outdoor space for my son; and washer and dryer hookups in the unit. These were reasonable must-haves. And surprisingly, I ended up fulfilling most of my nice-to-haves as well!
4. Use a reliable internet search tool. I know many people are using sites like Zillow and Trulia, but I’d recommend using ColoProperty or REColorado. These two sites directly integrate in real time with the local MLS. ColoProperty is primarily used for northern Colorado listings, but if you’re looking in the metro area, REColorado is very helpful. I’ve found a lot of incorrect and outdated information on consumer sites like Zillow. It’s helpful to use a website that is the front end of the MLS, which 99 percent of real estate brokers use.
5. Be patient; if a deal falls through, something else better will most likely come along. Tony gave me this advice and he was right!
6. Examine the total cost of renting. If you think buying is more expensive than renting, look at the scenario in more detail. For example, if I had to continue renting and paying a security deposit, pet deposit, pet rent, parking payments, storage payments, market rent increases each year, separate water, trash, recycling, and insurance costs (these are all rolled into my HOA dues and mortgage payment now), I was going to lose my mind. Not to mention, there are great tax benefits to owning. Add it all up first; you may be pleasantly surprised!
7. Get a home warranty. I have one for two years. It cost around $500, but with a 26-year-old furnace that will likely break down soon, it’s well worth it. It covers the expenses of repair or replacement of all of my appliances, A/C, furnace, water heater, etc. Great peace of mind!
8. You get what you pay for. I learned this lesson the hard way. If you plan on hiring anyone to do work on your place, make sure you get multiple estimates and that you clearly communicate your expectations. Things ended up working out in my situation, but it was stressful to say the least!
9. Learn how to be handy. Growing up, my parents were so amazing at fixing and building things that I never had to learn how to do anything. Now I wish I had because I don’t want to hire someone every time I need to fix something. Luckily, I have some great friends who are helping me to finally embrace my inner handy-woman.
10. Chill out! I love home remodeling, decorating, and design. I have binders full of magazine clippings. There are so many things I’d like to update and buy for my place but I can’t do it all at once. I’ve done a few things to make it functional like installing more shelving in my laundry room (to store the plethora of kitchen appliances and cooking supplies I own!), upgrading a shower head, and painting, which I haven’t been able to do as a renter. I’ve found that much of the joy in remodeling comes with time. Slowly, but surely, I’ll make changes and enjoy the journey of it all.

Lowest Bid – Sometimes you get what you pay for

We’ve worked with clients in the past that had to engage a contractor before or after closing. It’s wise to get multiple bids from several vendors. I’m a big believer in referrals so I think it’s especially wise to get some estimates from trusted referral sources. Sometimes folks automatically choose the lowest bid, which can sometimes have negative ramifications.

Sometimes contractors underestimate the scope of the project and later try to justify an increase in price. Sometimes the lower price is indicative of an inferior operation altogether, which can affect schedule delays, delay of ordering the right parts or materials, or other basic operational components of a project. We once had a “lowest bid” roofer that didn’t order enough roofing material for a job and the mistake could have delayed closing if not for reasonable negotiations on both sides of the transaction. One would think that ordering enough roofing material would be a key component of a roofer’s service!

Lowest bid projects can often result in a discrepancy between what the client really wanted and what the contractor assumed the job would entail. This can cause a lot of stress on both sides and sometimes the job will need to be redone from scratch or lawyers will need to get involved. Not a pretty picture!

In summary, we advise our clients that if they choose “the lowest bid” that it’s wise to get the project fully scoped and agreed to in writing, with possible contractor penalties for schedule delays or “scope creep.” The lowest bid vendor may end up doing a great job but if they don’t it’s wise to have expectations written and agreed to in advance. Because, as we know in life, you often get what you pay for.

Preparing your home for winter

It’s that time of year to prepare our homes for the winter ahead. It is important to do things like blow out lawn sprinklers to prevent your pipes from freezing and to replace your furnace’s air filter. Replacing the furnace air filter is a common annual task that many home owners ignore. This remedial task can do wonders for improving air quality and improving the efficiency of the furnace which will result in lower energy bills and prolonging the life of the furnace.

Here are some helpful links that list what to do to prepare your home for the winter season:

Bob Vila’s Winter Preparation Checklist

This Old House’s Step-by-Step Instructions with Instructional Videos

Taking some proactive measures before winter sets in can assure homeowners that their house is in order before spring – in regard to their wallets, safety, and assuring the longevity of such an important investment!

Helpful SmartRegs resources

As expected, SmartRegs was passed by Boulder City Council on Sept. 21. Many of the details are still being worked out, so many property managers and homeowners are confused about what it means to them. When renewing their rental licenses, landlords will be expected to comply with a prescriptive 100 point requirement for energy upgrades to their units. To find out more about SmartRegs, visit:

–The City of Boulder’s SmartRegs website
–The Boulder Area Rental Housing Association has some helpful information on their website, as well, including links to a “Smart Points Compliance sheet,” a “Chart of the Prescriptive Points” and “Proposed Measurements.”

These are some useful resources that will help everyone determine if they are currently in compliance or if they will need to make some changes in the future.

The other side of the transaction

I recently represented a buyer in a transaction and toward the end of it, I got an opportunity to meet the sellers and I was quite moved. 

The deal’s negotiations had a couple of “starts and stops” throughout as the two sides had a difference of opinion on the market value of the home. And once we got under contract we had even more negotiation on inspection items that, although civil, was a little unsettling for both parties. 
 
As we were performing the final walkthrough prior to closing, the sellers agreed to show our buyers some of the maintenance aspects of the home. During this time I had a chance to talk to one of the sellers for about 30 minutes, which turned out to be an amazing conversation. During this time, I found out that the sellers have had some striking challenges in their business that paralleled some of the experiences that I encountered in my not so distant past. They were also going through some tough family issues as well. I was so touched by the grace, compassion and sincerity of the seller that I couldn’t get the discussion out of my mind for the rest of the day. Despite the very tough time this person was having, there was a sparkle in the seller’s eye that showed tremendous inner strength and a zest for life. What an amazing person I had just met! 
 
Although I have no regrets on how hard I negotiated on my clients’ behalf, this experience was a reminder of the human nature of our real estate negotiations. Obviously some folks that are selling in this market are experiencing rough times. As Realtors in our community, we should remember that there is a way to negotiate hard for our clients, but respect and understand the human element of the negotiations on the other side of the transaction. There are some wonderful folks on both sides and if we’re fortunate enough, we might just learn something from some of the folks on the other side.

Like it or not, SmartRegs is almost approved

On Sept. 7, Boulder City Council discussed passing an ordinance that would require rental property owners to make energy-efficiency upgrades to their properties by the end of 2018. If approved at the Sept. 21 final vote, SmartRegs requirements will go into effect in 2019. While landlords have been overwhelmingly against these type of regulations, there has been a lot of “give and take” on the controversial issue.

“I think this is about as close as we can get to an ordinance that is workable. We’ve really come a long, long way,” said Boulder Mayor Susan Osbourne in a Sept. 8 Daily Camera article.

Boulder rental property owners should give a big thanks to all the people that have worked to achieve balance around this ordinance. Boulder Area REALTOR Association (BARA) Executive Director Sheila Horton and Realtor Dan Estey deserve a great deal of credit and gratitude for all their efforts on the matter. Here is what BARA Senior Vice President Kenneth Hotard has to say:

“BARA’s Government Affairs Committee member, Dan Estey, has provided critical leadership on this issue for well over a year. As written, the regulations require compliance by Jan. 1, 2019 rather than tying compliance to rental license renewals. The controversial proposals require rental property owners to improve energy efficiency of their units and achieve 100 points on a list of retrofits approved by the city. Observers believe the current program is a significant improvement over initial proposals but still will have significant costs.”   

There will be a number of incentives and rebates available to landlords during the first three years of the deployment of this ordinance. More details about these incentives will be forthcoming from the City Council. In my opinion, rental property owners should take full advantage of these incentives to upgrade their properties as cost effectively as possible. 

Read more about SmartRegs at www.smartregs.org and www.bouldercolorado.gov/smartregs.

What a great time to buy an investment property!

Wow, what a great time to buy an investment property! We just found a client a great deal on a turn-key home in Boulder County that should cash flow and appreciate well. It is a three bedroom, two bath house with attached garage, sizeable lot with mountain views, and is in the $200K range. Our client also locked in some amazing financial terms: a 30 year fixed interest rate at 4.375% with 25 percent down and paying a point of the interest rate. Our client has also easily rented it out for $1,550 per month. There are many properties in the area that are ideal investment properties: great cash flow, solid appreciation potential, and an easy rental!

Know Your Options website helps homeowners avoid foreclosure

Fannie Mae recently launched www.KnowYourOptions.com, a website that helps struggling homeowners avoid foreclosure. The website is bilingual and helps homeowners explore their options if they are having difficulty making their payments.

“Through foreclosure prevention programs, borrower outreach, underwriting guidelines and servicer engagement, Fannie Mae is taking a comprehensive approach to helping struggling borrowers,” said Jeff Hayward, Senior Vice President, Fannie Mae’s National Servicing Organization.

The website includes an “Interactive Options Finder,” calculators, videos from homeowners, a virtual assistant to help navigate the site, forms, and a financial checklist. For more information, refer to their August news release.

This is a great resource for homeowners. There are many alternatives to foreclosure and many folks may not know that these resources are available. Help spread the word!