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Wonderful Two Story in Johnstown!
Welcome home to this beautiful updated and well-maintained home at 482 Territory Lane in Johnstown. This home features amazing curb appeal, updated laminate flooring throughout the main floor, stylish updated paint throughout the entire home, 4 bedrooms all on the upper level perfect for a family, and a beautifully landscaped back yard with a large established garden. The exterior has been recently painted and the front porch has been updated to make this home really stand out!! Contact Brooke Kern at (970) 980-8349 for your private showing for more information or click the link below for more details.
At Least List
Periodically we track a stat which we find to be quite interesting.
It answers this question – how many properties are selling for at least list price (asking price or higher)?
This stat tells us how active the market is and helps our buyers to realize that, in some cases, they will be in a competitive situation.
When we look at single-family home sales so far this month, this is what we find:
- 57% of properties in Larimer County sell for at least list price
- 62% of properties in Weld County sell for at least list price
So, in well over half of the transactions, buyers need to offer list price or higher to acquire the property.
The data gets even more interesting when this information is broken out by price range.
To no one’s surprise, the percentage increases for properties priced under $400,000:
- 81% in Larimer County
- 70% in Weld County
We find that for properties over $400,000 the percentages still tell a story of a very active market:
- 47% in Larimer County
- 56% in Weld County
Bottom line, in most locations and price ranges we see a strong sellers’ market where buyers need to be prepared to make a strong offer and to also compete.
Buyer Contemplation
New research from the National Association of Home Builders:
The number of Americans contemplating purchasing a home in the second quarter of 2020 is nearly the same as 2019’s second quarter, according to NAHB’s Housing Trends Report.
At this time last year, 12% of Americans considered buying a home. Today the number stands at 11%.
The same goes for first-time prospective buyers, where 58% considered buying a home in the second quarter of 2019 and 59% are considering it in 2020’s second quarter.
In the second quarter of 2020, Millennials are the generation most likely to want to buy a home (19%), even slightly higher than a year earlier (17%).
Boomers, on the other hand, are the least likely, with the share planning a home purchase falling from 7% to 5%.
Across regions, the share of respondents who are prospective home buyers is unchanged in the Northeast (10%) and South (12%), essentially flat in the West (13%), and just slightly lower in the Midwest (down from 11% to 9%
More Homes Needed
The market is in short supply.
More homes are needed to fulfill the need to buyer demand.
Compared to exactly one year ago, the supply of homes is down:
- 32.6% in Metro Denver
- 25.1% in Northern Colorado
An interesting and useful measurement we track is months of inventory. This stat tells how long it would take to sell all of the homes currently for sale at the current pace of sales.
Of course, months of supply can vary greatly by price range and location. However, this stat does a good job of explaining the overall state of the market.
Specifically, months of supply tells us if the market is in balance.
A ‘balanced’ market is when there is 4 to 6 months of supply. A buyers market occurs when the stat is higher than this range. A sellers market occurs when it is lower.
The months of supply looks like this in our market:
- 1.0 months in Metro Denver
- 1.3 months in Northern Colorado
So, the market overall is significantly under-supplied and more homes are needed to meet demand.
Rate Meaning
Mortgage interest rates have hit another record low this week.
Mortgage applications for purchases just hit an 11-year high.
Rates are at a level that many people could never have imagined.
Here’s something that is surprising to many people…
Rates are 1.5% lower than they were just two years ago.
Here’s what that means for buyers…
Pretend someone is looking at a $500,000 home and they will have a 20% down payment.
The difference in monthly payment is $320 between two years ago and today.
Obviously that is a significant amount of money.
Imagine what a person could do with $320 per month.
The fact that rates are at record lows is one of many reasons that the market is so strong right now and prices continue to appreciate at healthy levels.
What ‘s My Home Worth? The Downside to Home Valuation Tools
It is a seemingly simple question. However, discovering the worth of your home is more complicated than it might seem. Sites like Zillow, Redfin, Eppraisal, and others have built-in home valuation tools that make it seem easy, but how accurate are they? And if you get three different answers, which one do you believe? Online valuation tools have become a pivotal part of the home buying and selling process, but they’ve proven to be highly unreliable in certain instances. What these valuation tools have made clear is that real estate agents are as vital to the process of pricing a home as they ever were—and maybe even more so now.
Every online valuation tool has its limitations. Most are readily acknowledged by their providers, such as “Zestimate” from Zillow, which clearly states that it offers a median error rate of 4.5%. That may not sound like a lot, but keep in mind that 4.5% amounts to a difference of about $31,500 for a $700,000 home. For Redfin and Trulia, there are similar variances. When you dig deeper into these valuation tools, it’s no wonder that there are discrepancies. They rely on a range of different sources for information, some more reliable than others.
Redfin’s tool pulls information directly from multiple listing services (MLSs) across the country. Others negotiate limited data sharing deals with those same services, relying on public and homeowners’ records alike. This can lead to gaps in coverage. These tools can serve as helpful pieces of the puzzle when buying or selling a home, but the acknowledged error rate is a reminder of how dangerous a heavy reliance on them can be.
Nothing compares to the level of detail and knowledge a professional real estate agent offers when pricing a home. An algorithm can’t possibly know about the unique characteristics of neither a home nor its neighborhood. Curious about what improvements you can make to get top dollar or how buyer behaviors are shaping the market? They cannot provide an answer there, either. That can only be delivered by a trusted professional whose number one priority is getting you the best price in a time frame that meets your needs.
If you’re curious about your home’s value, Windermere offers a tool that provides a series of evaluations on your property and the surrounding market. And once you’re ready, we’re happy to connect you with a Windermere agent who can clarify this information and perform a Comparative Market Analysis to get an even more accurate estimate of what your home could fetch in today’s market.
Economist’s Perspective
Our Chief Economist made a video for all of our clients where he shares his perspective on COVID-19’s impact on housing. You can watch it by clicking the image below:
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Mistakes to Avoid When Buying and Selling a Home
There’s nothing more exciting, rewarding, and fulfilling than buying a home. However, it’s a complex transaction; there are a number of steps along the path that can confuse, betwixt, and befuddle even the most seasoned buyers and sellers.
How can you avoid those potential pitfalls and common mistakes? Look to your real estate professional for advice and keep these guidelines in mind:
BUYERS:
#1 Review your credit reports ahead of time
Review your credit report a few months before you begin your house hunt, and you’ll have time to ensure the facts are correct and be able to dispute mistakes before a mortgage lender checks your credit. Get a copy of your credit report from Experian, Equifax, and TransUnion. Why all three? Because, if the scores differ, the bank will typically use the lowest one. Alert the credit bureaus if you see any mistakes, fix any problems you discover, and don’t apply for any new credit until after your home loan closes.
#2 Get pre-approved
Before getting serious about your hunt for a new house, you’ll want to choose a lender and get pre-approved for a mortgage (not just pre-qualified—which is a cursory review of your finances—but pre-approved for a loan of a specific amount). Pre-approval lets sellers know you’re serious. Most importantly, pre-approval will help you determine exactly how much you can comfortably afford to spend.
#3 Know what you want
You and your real estate agent should both be clear about the house you want to buy. Put it in writing. First, make a list of all the features and amenities you really want. Then, number each item and prioritize them. Now, divide the list into must-haves and really-wants.
#4 Account for hidden costs
In addition to the purchase price of the home, there are additional costs you need to take into consideration, such as closing costs, appraisal fees, and escrow fees. Once you find a prospective home, you’ll want to:
- Get estimates for any repairs or remodeling it may need.
- Estimate how much it will cost to maintain (gas, electric, utilities, etc.).
- Determine how much you’ll pay in taxes monthly and/or annually.
- Learn whether there are any homeowner’s or development dues associated with the property.
#5 Get an inspection
Buying a home is emotionally charged—which can make it difficult for buyers to see the house for what it truly is. That’s why you need impartial third parties who can help you logically analyze the condition of the property. Your agent is there to advise you, but you also need a home inspector to assess any hidden flaws, structural damage or faulty systems.
#6 Evaluate the neighborhood and location
When house hunting, it’s easy to become overly focused on the number of bedrooms and bathrooms, the condition of the home and its amenities while overlooking the subtleties of the surrounding neighborhood. Take time to check crime reports, school options, churches and shopping. If schools are a key factor, do more than simply research the statistics; speak with the principal(s) and chat with the parents waiting outside.
SELLERS:
#1 Avoid becoming emotional or sentimental about the sale
Once you decide to sell your house, it’s time to strip out the emotion and look at it as a commodity in a business transaction. If you start reminiscing about all the good times you had and the hard work you invested, it will only make it that much harder to successfully price, prepare, and market the home.
#2 Fix problems (or price accordingly)
Homes with deferred maintenance and repair issues can take far longer to sell and can be subject to last-minute sale-cancellations. These homes also often sell for less than their legitimate market value. If you simply can’t afford to address critical issues, be prepared to work with your agent to price and market your home accordingly.
#3 Don’t overprice your home (and/or refuse to negotiate)
Getting top dollar is the dream of every seller. But it’s essential that you let the market dictate that price, not your emotions or financial situation. Allow your agent to research and prepare a market analysis that factors in the value of similar homes in the area, and trust those results.
#4 Use quality photos
The vast majority of prospective buyers today search for homes online first. In order to make a good first impression, you need a wealth of high-quality photos of your home and surrounding grounds. You may also need to consider professional staging in order to position your home in the best possible light for prospective buyers.
The process of buying or selling a home can have plenty of twists and turns, but with some smart decision making, you can avoid the most common mistakes and pitfalls.
Click here if you would like to connect with an experienced real estate agent.
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.
Inventory vs . Sales
A stat we find interesting is the relationship between the inventory for sale versus what is actually selling.
Specifically what we look at are price ranges.
We are curious to know if the inventory that is for sale lines up with what the buyers want.
Here’s what we notice…
In Larimer County, 23% of all the single family homes for sale are priced under $400,000. No surprise, this is a popular price range among buyers and it represents 45% of all sales.
So, the ratio is 23% of the inventory versus 45% of the sales.
In Weld County, the difference is more pronounced.
Homes under $400,000 represent 44% of the inventory and 69% of the sales.
Because the percentage of sales is higher than the percentage of inventory, properties under $400,000 will sell much quicker and are more likely to have multiple offers.
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To see the latest on the market, be sure to check out a copy of the new Gardner Report, our Chief Economist’s quarterly look at Front Range real estate.
