Living Littleton

    Home loan rates for buyers in Littleton or Denver continue to drop.  FHA rates are about 4.25%, depending on the day you ask.  This is quite a surprise from what the experts were all predicting back at the first of the year.  If you remember, they were saying rates would start to rise in the second quarter because the Fed was going to quit buying home loans.  Most were saying rates could rise 3/4 to 1 % by the end of the year.  That would have us in the high 5’s, but we’re no where near that at the present time.  The Fed did quit buying home loans, however, there has been so much money pouring into Treasuries instead of stocks, that the price of Treasuries has been bid up.  They run counter to interest rates, so when the price of the bond goes up, the interest rate goes down.

    Today’s low rates, coupled with the supply of homes at bargain prices has made this a perfect time to buy a home in Littleton.  If you weren’t able to purchase by the end of April, to take advantage of the Federal Tax Credit, you aren’t left out in the cold.  The low rates will give you a return over what someone had to pay 5 months ago for their home loan, that will make up for the tax credit, over time.  

     Even with this perfect combination of rates and supply, home sales aren’t going through the roof.  I suspect that many wanna be buyers just don’t have the money.  If that’s your case, or you know of someone who’s faced with that issue, you may want to look at the attached loan comparison chart for a $200,000 home purchase, at the end of this post.  It’s the only Zero Down home loan available, outside of VA.  It’s a 30 year fixed rate loan that is always below market and doesn’t require any money down.  In addition to that, there are no closing cost, just pre-paids.  I’ve made reference to this loan in the past, however, I’ve never broke it out so people could see the benefits, when compared to FHA. . The first column is for an FHA loan, where the seller paid 3% towards paying buyer’s closing cost.  The second column is where the seller pays 3% to buy the rate down an additional .75%, to 3.25%.  Since there aren’t any closing cost, the buyer doesn’t need to have that money apply to his cost.  The third column is were the buyer elects to discount the price of the home by 3% and just go with the market rate on the Zero Down loan, which is 4%.

   If this is something you’re interested in, give me a call ASAP.  It takes a little longer to process these loans, as you have to attend a workshop, first, and they’re only held once a month.  I only make this loan available to my clients, so please don’t contact me if you have a relationship with another Realtor.

                                                                                    Loan Comparison

                                                                          Purchase Price $200,000

   Vacancy rates in the Littleton and Denver Metro area continue their downward trend.   In fact, they’re the lowest since 2001, according to the Denver Post.  This low rate is contributed to the fact more people are moving here, coupled with the fact fewer apartments are being built.  To give you an idea of how quickly rates have fallen, they were at 9% in the second quarter of 2009.  We’re also seeing a very healthy rental rate in single family homes from what Realtors were saying at a quarterly real estate trends class, I attended.  With very little apartment construction in the planning stages, along with the continued growth, experts are predicting rates to fall even lower in the coming quarters.  This will ultimately lead to higher rates and pickier land lords.

Jerry Becker
www.jerrybeckerandassoc.com

   High end homes in the Denver/Littleton area are starting to rebound from their record lows.  It’s no secret that the high end home market has been close to dormant over the last couple of years, with the uncertainty in the market coupled with the difficulty in obtaining jumbo loan financing.  The good news is that we are starting to see in increase in this market for homes priced over a million dollars.  In fact, sales in this price range have risen to a level not seen in two years.  Several factors have contributed to this, the most important being the steep discounting some sellers have been forced to do, in order to get their homes sold.  Coupled with a slowly building demand, record low rates, and the beginning of some sanity in the mortgage industry,  buyers are starting to become more active in this price range.

    This increase in the high end market may pull up the average sales prices in the Denver/Littleton market.  If this happens, hopefully buyers won’t be lead to believe all home prices have increased by the announce price increase, if there is one.  As I always stress, these figures are the average prices of all the homes sold, not the percentage increase in prices.

A local real estate company recently finished an analysis of which homes are most likely to sell.  As it takes a while for a home to go through the selling process, they limited their study to homes that went on the market from January through September of 2009.  What they found out was the odds of a home selling were dependant on several factors. 
1.  Homes owned by banks (REO) had the best chances.  90% of these listings sold, with the remaining 10% being withdrawn from the market or had the listing expire.
2.  Short sales (SS) were the least likely to sell with only 32% of these listings ever selling.
3.  Regular, non-distressed home listings had only slightly better odds than short sales, with 37% of these selling.

In the various categories, they discovered that the price of a home determined it’s odds of selling.  In the Denver and Littleton market, the least expensive, 10% of all homes sell for $85,000 or less. Non-distressed sellers in this price range had a success rate of 78%.  This is compared to a success rate of just 44% for SS sellers in the same price range.  At the opposite end of the range, the most expensive 10% of  the home sales sold for over $460,000.  This market segment requires a jumbo loan, and they weren’t easy to obtain, or cheap, during this time period.  In this high end, only 16% of the regular listings sold and only 14% of the SS.

For a middle of the pack comparison, let me tell you that in the price range of $210,000 to $315,000 for regular, non-distressed home listings, only 41% of these homes sold.  Now true, this information came from 2009’s market and we’re doing much better in 2010, however, as a seller, one really needs to pay attention to the prices of previous sales.  Over reaching in this market can end up costing you lots of time plus a potential sale.

Jerry Becker
jbeckerhomes@comcast.net

    Vacancy rates in Littleton and Metro Denver continue to show improvement, based on the latest report released by the Colorado Division of Housing.  When considering the rates of single family homes, for-rent condos, and other small properties, the vacancy rate for the first quarter had dropped to a two year low of 3.1 percent.  This is compared to a vacancy rate of 3.9 percent in the first quarter of 2009.  Our highest recent vacancy rate occurred in 2005, when it stood at 9.5 percent.  This was a result of people buying homes like crazy so they wouldn’t be priced out of the market.  Many accomplished this by using some of the creative loan products that were available, at that time, and of course we all know how that worked out.
    For those of you that are regular readers of this blog, you may note that last month I commented on how the vacancy rate stood at 6.5%.  Be sure to note, that it was for apartments, only, while the above data excludes apartments.
Jerry Becker
Jerry Becker and Associates – Metro Brokers
jbeckerhomes@comcast.net

For the fifth month in a row Denver Metro home prices, which includes Littleton, have shown an increase in year over year pricing.  There was also a slight increase from February of this year to March of this year.  These statistics came from the latest S&P/Case-Shiller Home Price Index.

The report showed the the average price increase from a year ago was 4.1%.  Once again, I want to stress that these are the averages of all the homes sold in the respective months, and not the increase of 4.1% for each home. 

Since much of the market was driven by the push of first time buyers to take advantage of the expiring tax credit, I suspect the market was weighted to more of the entry home price range.  We may see another increase in April as that was the last month to take advantage of the tax credit.  After that, the experts predict the number of sales will slow, however, we may see more of a mix of higher priced homes because of the fall off from first time buyers.  This may give us a continued increase in year over year prices, however, the total number of home sales may decline.  These experts also expected interest rates to be higher by now, but in fact, they’ve declined.  It’ll be interesting to see how all of this shakes out.            

Another index is a comparison of a market’s present average home values when compared to the year 2000.  Based on that index, Denver and Littleton came in at 125.31.  That means prices were 25.31% higher than they were in 2000.  The average for the top 20 cities was 143.35 in March.

Jerry Becker
Jerry Becker and Associates – Metro Brokers
jbeckerhomes@comcast.net

A spokesman for King Tut expressed his regrets about not being able to visit Littleton this year.  According to the spokesman, the Boy King was looking forward to dining at Opus, having a chocolate fondue at the Melting Pot and if time allowed to end the evening with drinks from Merle’s roof top deck.  Due to time constraints, the Littleton stop over had to be scratched, but he still held out hope that he could make it another time.

The good news is that even though King Tut won’t be appearing in Littleton, you can still catch him in Denver at the Denver Art Museum.  He’ll be arriving soon and plans on hanging around til early 2011.  Unfortunately, in these tough economic times, even the Boy King is running short of funds, so he plans on charging you if you would like to go.  Tickets are for specific days and times with the best deals being during the week.

Go to www.kingtut.org to get more information and purchase your tickets.

Jerry Becker
Jerry Becker and Associates
jbeckerhomes@comcast.net

 We all have heard reports about how our economy here in Littleton and the rest of Colorado is getting better, and I believe it is, however, we all know that some people are still having a tough time of it.  If you know of someone that could use some help, at this time, you may want to tell them about Angle Food Ministries.  Simply put, Angle Food Ministries is a non-profit, non-denominational organization dedicated food relief and financial support to local communities throughout the US. 

This program started in Georgia in 1994 by helping 34 families and has since grown to cover 44 states.  Angle Food works through local churches to distribute food boxes at a reduced cost to families in need.  They sell medium sized boxes of food for $30 that would have a normal retail price of about $60.  Based on their calculations, one box should feed a family a four for a week, or a single senior citizen about a month.  The food is the same quality as one could purchase at a grocery store and isn’t comprised of seconds, dented cans, or damaged packaging. 

Angle Food also offers expanded box choices of meat, chicken, or pork, plus participants aren’t limited to purchasing just one box.  Additionally, participants aren’t required to adhere to any government programs.  If you know someone that could use a hand, have them contact Angle Food; http://www.anglefoodministries.com.

Jerry Becker
Jerry Becker and Associates
jbeckerhomes@comcast.net

Last year was such a success that Littleton’s Olde Town Market will be back for a second year starting this Saturday, May 8th.  Then every second Saturday of each month through September you can experience it  starting at 10:00 AM and running until 4:00PM.  Walk the streets of down town Littleton and experience the fun of an open air market with antiques, jewelry, artisans, one of a kind pieces, as well as the existing merchants and restaurants.  For more details check out www.oldetownmarket.com.

Jerry Becker
Jerry Becker and Associates – Metro Brokers
jbeckerhomes@comcast.net

   Are you a transplant in Littleton or the Denver metro area? Many of us are, but do you have friends or relatives back in your home state that are wondering what you’ve gotten yourself into.  Oh, sure, you tell them it’s real nice here and they should come visit but do they really believe you?      

  I just recently added 10 short videos on my web site that highlights what living in Littleton and metro Denver is like, not to mention our state.  If you want to give your doubters a third party testimonial, have them log on to www.JerryBeckerAndAssoc.com.  The videos average about two minutes each and after they watch them, they’ll be calling you, as they make their vacation plans.

Jerry Becker
jbeckerhomes@comcast.net