We are starting to see some real "buys" in the market, and it may be time for you to consider snatching one, but maybe you have to sell a home to buy another. If that is your situation, this is the best time to be a "move up" buyer.
Let's pretend for a moment that you could have sold your home and purchased a new home when the market was stronger, and for easy numbers let's assume the home you were selling was $400,000 and the new home was $600,000. Let's also assume that the market has corrected by 10% on prices, and the concern is the negative of taking less for your home. In reality, you are better off today in selling and buying a more expensive home than you would have when the market was better! How can that be? It is simple, if the market value of the property is 10% less for both properties, you will save $20,000 purchasing today.
Let's look at the math:
When the market was stronger:
Price of home: $400,000
Price of new home: $600,000
Difference: $200,000
After the market corrected: (10% Price Adjustment)
Price of home: $360,000 ($400,000 - 10%)
Price of new home: $540,000 ($600,000 - 10%)
Difference: $180,000
Savings: $20,000 !!!
Now, in addition, the market inventory is much greater, offering you choices that were not available in a stronger market. The combination of a better value equation coupled with more inventory, and historic low interest rates makes this the best time to purchase a home.
If you would like further information on this idea or a market evaluation of your home in Durango/Bayfield Colorado, please contact me, Don Ricedorff at The Wells Group real estate brokerage, 970-375-7014, e-mail me at don@frontier.net, or visit me on the web at www.durangorealproperty.com.
Don Ricedorff is a licensed real estate broker in the State of Colorado, and he resides in Durango Colorado. He has numerous real estate designation including, CRS, CRB, CCIM,ABR, GRI, RSPS, and CIPS, and he is active in his church and in the community.
Monday, October 6, 2008
Thursday, September 18, 2008
The Perfect Season
Have you noticed the beautiful fall days, with a hint of chill in the air in the morning, and warming to the mid-70's during the day? How about the deep blue skies and the clear rivers and streams? Even, the fall colors are beginning to show. Yes, it is the perfect season.
It is also the perfect season for real estate. This has been a year of transition in the real estate and financial markets, and it is clearly a buyers market. What makes a perfect season for real estate? The market must have adequate choices; a couple of years ago, there was a low inventory, and few choices for buyers. Today, the number of homes available is great, and buyers have significant choices. Second, this is a great time for negotiation, as there is competition in many neighborhoods, and we are in the fall selling season prior to winter. Third, if you have solid credit, an adequate down payment, and most important, a good credit score, money is available, and interest rates are low. The low cost of money, many great choices, and a strong negotiation position makes this the perfect season to buy!!
Last, this is the perfect season in our life! We are fortunate to live in a great country, with all of our freedoms, and to wake up each day to a bright and wonderful future. We need to be thankful for those serving in the armed forces that protect our freedoms, and be thankful for those in leadership of our nation, state, country, and city for their commitment to give of themselves to better our opportunities. Most importantly for those of us that call Durango home, we live in the best place in the country, and there are people all over this nation that wish they could be here.
This is truly a blessed season. Enjoy and make the most of it, and don't forget to vote.
Don
If I can be of any service, please contact me: Don Ricedorff at 970-275-7014, don@frontier.net, or at my website at durangorealproperty.com.
Don Ricedorff is a licensed real estate broker in the State of Colorado, and he resides in Durango Colorado. He has numerous real estate designations including, CRS, CRB, CCIM, ABR, GRI, RSPS, and CIPS, and he is active in his church, and in the community.
It is also the perfect season for real estate. This has been a year of transition in the real estate and financial markets, and it is clearly a buyers market. What makes a perfect season for real estate? The market must have adequate choices; a couple of years ago, there was a low inventory, and few choices for buyers. Today, the number of homes available is great, and buyers have significant choices. Second, this is a great time for negotiation, as there is competition in many neighborhoods, and we are in the fall selling season prior to winter. Third, if you have solid credit, an adequate down payment, and most important, a good credit score, money is available, and interest rates are low. The low cost of money, many great choices, and a strong negotiation position makes this the perfect season to buy!!
Last, this is the perfect season in our life! We are fortunate to live in a great country, with all of our freedoms, and to wake up each day to a bright and wonderful future. We need to be thankful for those serving in the armed forces that protect our freedoms, and be thankful for those in leadership of our nation, state, country, and city for their commitment to give of themselves to better our opportunities. Most importantly for those of us that call Durango home, we live in the best place in the country, and there are people all over this nation that wish they could be here.
This is truly a blessed season. Enjoy and make the most of it, and don't forget to vote.
Don
If I can be of any service, please contact me: Don Ricedorff at 970-275-7014, don@frontier.net, or at my website at durangorealproperty.com.
Don Ricedorff is a licensed real estate broker in the State of Colorado, and he resides in Durango Colorado. He has numerous real estate designations including, CRS, CRB, CCIM, ABR, GRI, RSPS, and CIPS, and he is active in his church, and in the community.
Monday, September 15, 2008
THE RULES HAVE CHANGED FOR BUYING REAL ESTATE IN DURANGO COLORADO AND ELSEWHERE!
Today's news, September 15, 2008: Lehman Brothers files bankruptcy notice and Merrill Lynch agrees to a forced sale to Bank of America for $50 billion, resulting in further turmoil in the financial markets. What does this mean to you if you are buying or selling real estate in Durango Colorado?
First, the financial markets are global, and these developments are evidence that the sub-prime mortgage fiasco has not run its full course. Even before the recent change with Freddie Mac, and Fannie Mae to government oversight, lenders have changed the rules for qualifying for mortgages. Today, your credit worthiness is more important than it has been in the last decade or longer. The qualifying requirements have also tightened in the last 12 months. For sellers, this means fewer qualified buyers, and for buyers, it means much tougher standards, a more difficult loan process, and potentially more expensive credit. For borrowers with excellent credit, and a low debt-to-income ratio, they will see very little difference.
If you learn nothing else from this article, KNOW THIS: your credit score will determine the cost, and even the potential for borrowing money. If you have a credit score of 740 or higher, you will get the best rates. If your credit score is 695, you may have to pay a 1/4% higher interest rate, and a borrower with a score of 655 will pay 1/2% or more. This impacts the amount of money a lender may loan to a borrower, and the the difference in cost of that money. For example, on a $400,000 loan with the rate at 6.5% the borrower with a credit score of 655 will pay $166.60 more per month than the same amount of loan, but with a credit score of 740. If we use the same $400,000 loan, and we use equivalent payments, the borrower with the 655 credit score will be able to borrow $25,000 less money.
The loan to value ratios have also tightened. It was not uncommon in the recent past to get a 100% loan, but today, the minimum down payment is 5%, and that is on a primary residence. Other important changes include the the cost of jumbo financing, which is required on loan amounts above $443,750 in La Plata County. Jumbo rates are 1.5% to 2.0% higher interest rates than conforming loan amounts. Some of the manufactured homes and condominiums are harder to finance today, as compared to the last few years, and underwriters have less discretion on loan requirements, and procedures than in the past.
The Good News: The federal government has taken huge steps to stabilize the financial markets, and the economy. They have reduced the impact of the sub-prime mortgage crisis, and they have even added incentives for purchase. Tip: Be sure to ask your lender about the $7,500 first time home buyer tax credit, if you think you may qualify.
The above quotes are used for example only, interest rates and costs change daily, and may be different by lender. It has never been more important to use a high quality, knowledgeable lender. Please do not make the mistake of many borrowers, and assume that all lenders are alike, and that they offer the same loan products, with the same level of advise and experience. In fact, I highly recommend high quality local lenders to assist you, and to advise you. We have seen situations with some "internet" companies that make promises, and then don't deliver, and for most borrowers, this is one of the biggest financial decisions of their life, and the quality of lender reprentation is key. For this article, I received help from David Fountain of Wells Fargo Mortgage, and I would highly recommend his service. You may reach him in his Durango Colorado office at 970-385-9360.
Real estate market good new! The sale of existing homes in July in the western states surpassed July 2007. The numbers were 106,000 units versus 102,000, and there are some individual markets seeing a rebound in real estate. These include Colombus, Oklahoma City, Charleston West Virginia, and in our state, Colorado Springs. Many real estate brokers and some national media believe that we are seeing the bottom of the market. If you are a buyer, getting your "ducks in a row" with your credit score and credit report may make a big difference as you find a home to purchase. For those of you that have not taken the first step, contact a good lender, and have them provide you with a pre-qualification letter. This will help you with your real estate broker, and in your negotiation on a property. If you have already contacted your lender, then call your Realtor to find your perfect property.
If I can be of any service, please contact me: Don Ricedorff at don@frontier.net, at my website at durangorealproperty.com, or by phone at 970-259-5007.
Don Ricedorff is a licensed real estate broker in the State of Colorado, and he resides in Durango Colorado. He has numerous real estate designations including, CRS, CRB, CCIM, ABR, GRI, RSPS, and CIPS, and he is active in his church, and in the community.
First, the financial markets are global, and these developments are evidence that the sub-prime mortgage fiasco has not run its full course. Even before the recent change with Freddie Mac, and Fannie Mae to government oversight, lenders have changed the rules for qualifying for mortgages. Today, your credit worthiness is more important than it has been in the last decade or longer. The qualifying requirements have also tightened in the last 12 months. For sellers, this means fewer qualified buyers, and for buyers, it means much tougher standards, a more difficult loan process, and potentially more expensive credit. For borrowers with excellent credit, and a low debt-to-income ratio, they will see very little difference.
If you learn nothing else from this article, KNOW THIS: your credit score will determine the cost, and even the potential for borrowing money. If you have a credit score of 740 or higher, you will get the best rates. If your credit score is 695, you may have to pay a 1/4% higher interest rate, and a borrower with a score of 655 will pay 1/2% or more. This impacts the amount of money a lender may loan to a borrower, and the the difference in cost of that money. For example, on a $400,000 loan with the rate at 6.5% the borrower with a credit score of 655 will pay $166.60 more per month than the same amount of loan, but with a credit score of 740. If we use the same $400,000 loan, and we use equivalent payments, the borrower with the 655 credit score will be able to borrow $25,000 less money.
The loan to value ratios have also tightened. It was not uncommon in the recent past to get a 100% loan, but today, the minimum down payment is 5%, and that is on a primary residence. Other important changes include the the cost of jumbo financing, which is required on loan amounts above $443,750 in La Plata County. Jumbo rates are 1.5% to 2.0% higher interest rates than conforming loan amounts. Some of the manufactured homes and condominiums are harder to finance today, as compared to the last few years, and underwriters have less discretion on loan requirements, and procedures than in the past.
The Good News: The federal government has taken huge steps to stabilize the financial markets, and the economy. They have reduced the impact of the sub-prime mortgage crisis, and they have even added incentives for purchase. Tip: Be sure to ask your lender about the $7,500 first time home buyer tax credit, if you think you may qualify.
The above quotes are used for example only, interest rates and costs change daily, and may be different by lender. It has never been more important to use a high quality, knowledgeable lender. Please do not make the mistake of many borrowers, and assume that all lenders are alike, and that they offer the same loan products, with the same level of advise and experience. In fact, I highly recommend high quality local lenders to assist you, and to advise you. We have seen situations with some "internet" companies that make promises, and then don't deliver, and for most borrowers, this is one of the biggest financial decisions of their life, and the quality of lender reprentation is key. For this article, I received help from David Fountain of Wells Fargo Mortgage, and I would highly recommend his service. You may reach him in his Durango Colorado office at 970-385-9360.
Real estate market good new! The sale of existing homes in July in the western states surpassed July 2007. The numbers were 106,000 units versus 102,000, and there are some individual markets seeing a rebound in real estate. These include Colombus, Oklahoma City, Charleston West Virginia, and in our state, Colorado Springs. Many real estate brokers and some national media believe that we are seeing the bottom of the market. If you are a buyer, getting your "ducks in a row" with your credit score and credit report may make a big difference as you find a home to purchase. For those of you that have not taken the first step, contact a good lender, and have them provide you with a pre-qualification letter. This will help you with your real estate broker, and in your negotiation on a property. If you have already contacted your lender, then call your Realtor to find your perfect property.
If I can be of any service, please contact me: Don Ricedorff at don@frontier.net, at my website at durangorealproperty.com, or by phone at 970-259-5007.
Don Ricedorff is a licensed real estate broker in the State of Colorado, and he resides in Durango Colorado. He has numerous real estate designations including, CRS, CRB, CCIM, ABR, GRI, RSPS, and CIPS, and he is active in his church, and in the community.
Thursday, August 14, 2008
You Can Benefit From A Buyer's Advocate In The Durango Colorado Real Estate Market...
This is perhaps the most important time to have an advocate in the real estate market. The need is great, because of the rapid change in the real estate market in Durango Colorado, and around the nation. The perception of the market by buyers and sellers is in transition. Everyone recognizes the shift to a buyer's market, and that buyers will more directly dictate terms and conditions, and there are deeply discounted properties on the market that are getting attention. As a buyer, what can you expect? How do you find the properties that are more distressed? How much shall you offer for a property? How do you manage the negotiation process? How do you negotiatate inspection issues? Do you clearly understand title issues and how they can impact your use and enjoyment of the property?
In Colorado, a real estate broker has the opportunity to provide service to buyers as a seller's agent, a transaction broker or a buyer's agent. Of course a seller's agent is "working" for the seller on the sellers behalf. As a transaction broker, the broker can not advocate or advise the customer. As a buyer's agent, a contract establishing "agency" is established, and the real estate broker may use their knowledge and experience to assist the buyer through the buying process. The real estate broker can advise and advocate for the buyer, and in fact, the real estate broker has a higher degree of responsibility to the client. Most often, the buyer's agent is paid the same, regardless of the type of relationship, and typically, the commissions are paid by the seller through the listing contract. There are other ways a buyer's agent can be paid if preferred by the buyer, and the real estate broker can discuss these with you. Enough of the legal! Simply said, the State of Colorado through the real estate commission has established a method for an agent to directly assist you.
Not all buyer's agents are created the same! Of course, there are lots of differences between real estate brokers, and their ability to assist you. Some of the basic criteria can vary greatly. Here are some of the questions you may want to ask. How much real estate experience does the real estate broker have? How long have they been in this market? Do they specialize in a segment of the market? What further education credentials have they completed? Ask them to provide the most recent statistics on the market. How many days on the market for properties? Is this growing? What is the sales price of recently sold properties versus their final list price? How would they recommend to work with you and why? How can they get you the best possible "deal"? What would they recommend for the negotiation process? Chemistry also plays a role, and by interviewing the broker, you can determine if that person is a good fit for you.
Last, you may want to consider real estate brokers who have the ABR designation. ABR stands for Accredited Buyer's Representative, and it is a designation awarded by the Real Estate Buyer's Agent Council of the National Association of Realtors. It is the benchmark of excellence in buyer representation. These designees have completed course requirements in buyer's representation, and they had to document successful sales transactions, in which they represented the buyer's interest.
In conclusion, make the most of this unusual opportunity. We have not seen a buyer's market like this one for 20 years. It is a great time to be a buyer, so take advantage of the opportunity by buying now, and utiliziing the services of a qualified buyer's agent!
This article is submitted by Don Ricedorff, a licensed real estate broker in Colorado, servicing La Plata County and Durango Colorado. If you need to reach Don, please contact him at don@frontier.net, at his office at The Wells Group, 970-375-7014, or visit him on the web at durangorealproperty.com.
Don Ricedorff
Broker Associate
ABR, CRS, CRB, CCIM, RSPS, GRI, CIPS
In Colorado, a real estate broker has the opportunity to provide service to buyers as a seller's agent, a transaction broker or a buyer's agent. Of course a seller's agent is "working" for the seller on the sellers behalf. As a transaction broker, the broker can not advocate or advise the customer. As a buyer's agent, a contract establishing "agency" is established, and the real estate broker may use their knowledge and experience to assist the buyer through the buying process. The real estate broker can advise and advocate for the buyer, and in fact, the real estate broker has a higher degree of responsibility to the client. Most often, the buyer's agent is paid the same, regardless of the type of relationship, and typically, the commissions are paid by the seller through the listing contract. There are other ways a buyer's agent can be paid if preferred by the buyer, and the real estate broker can discuss these with you. Enough of the legal! Simply said, the State of Colorado through the real estate commission has established a method for an agent to directly assist you.
Not all buyer's agents are created the same! Of course, there are lots of differences between real estate brokers, and their ability to assist you. Some of the basic criteria can vary greatly. Here are some of the questions you may want to ask. How much real estate experience does the real estate broker have? How long have they been in this market? Do they specialize in a segment of the market? What further education credentials have they completed? Ask them to provide the most recent statistics on the market. How many days on the market for properties? Is this growing? What is the sales price of recently sold properties versus their final list price? How would they recommend to work with you and why? How can they get you the best possible "deal"? What would they recommend for the negotiation process? Chemistry also plays a role, and by interviewing the broker, you can determine if that person is a good fit for you.
Last, you may want to consider real estate brokers who have the ABR designation. ABR stands for Accredited Buyer's Representative, and it is a designation awarded by the Real Estate Buyer's Agent Council of the National Association of Realtors. It is the benchmark of excellence in buyer representation. These designees have completed course requirements in buyer's representation, and they had to document successful sales transactions, in which they represented the buyer's interest.
In conclusion, make the most of this unusual opportunity. We have not seen a buyer's market like this one for 20 years. It is a great time to be a buyer, so take advantage of the opportunity by buying now, and utiliziing the services of a qualified buyer's agent!
This article is submitted by Don Ricedorff, a licensed real estate broker in Colorado, servicing La Plata County and Durango Colorado. If you need to reach Don, please contact him at don@frontier.net, at his office at The Wells Group, 970-375-7014, or visit him on the web at durangorealproperty.com.
Don Ricedorff
Broker Associate
ABR, CRS, CRB, CCIM, RSPS, GRI, CIPS
Saturday, July 19, 2008
Now Is The Time To Buy Durango Colorado Investment Real Estate!
Timing is everything, and the timing for buying Durango Colorado investment real estate is now. The Durango Herald (Durango's daily newspaper) ran an article today on the low supply and the increasing rental rates for rental homes and apartments in Durango. This is not a surprise, as we have been informing our clients for well over a year that rental rates are increasing, demand is high, and the supply is low. We live in an area of increasing population; the state demographer estimates our population increasing by 1 to 2 % per year. This population growth requires the need for housing, and businesses that service the increasing population.
As we know the real estate market has been soft, with several years of declining numbers of transactions, which means that the increased population must rely on rental homes. In addition, most of the investors have chosen other investments over the last few years, which has left the Durango market in a shortfall for housing. As investors, we look at the return from the rents and we look at the return on appreciation. Historically, we have seen residential rents average about 4-6 % of the value of the homes, and the appreciation has been an average of about 8.6 % for Durango homes in the last decade, and nationally the appreciation has been about 6 %. This can easily offer a double digit return.
Rents were under the market value for years, as first time home buyers moved out of rental property and into their first homes, and likewise, investors were purchasing homes to rent, which coupled to provide a large supply of rental homes. It was a tenant market, and the large supply with the low demand created a soft rental market. Now, that supply has turned around, and it is much more a landlord's market, and they can more easily dictate the amount of rent, the terms, and be particular on the quality of tenant.
The last ingredient for a perfect investment recipe is the timing of the real estate market for purchasing. We all know that it is a buyer's market, and although the median price has remained stable, there are deals out there. Again, we are in the third year of lower number of transactions, and sooner than later, this too will turn around. As astute investor will take advantage of these market conditions, and benefit in the long run. (Please read the previous blog on comparisons to the last housing crunch)
Last, smart investors invest money in markets that produce the best return for the lowest risks. How do you feel about the stock market right now? In these economic times, is it likely to give you the returns that you are looking for? Are the assets hard, meaning do they have underlying intrinsic value like real estate? Are you pleased with the returns in the financial markets, such as bonds or CD's? Will these instruments meet your long term goals? If your answers point you to investment real estate, please give me a call. You can reach me, Don Ricedorff at The Wells Group, 970-375-7014, e-mail me at don@frontier.net, or visit me on the web at durangorealproperty.com.
Don Ricedorff is a licensed real estate broker in the State of Colorado, and he has numerous real estate designations including CCIM (commercial real estate), CRS, CRB, GRI, ABR, RSPS, and CIPS. He has 15+ years of real estate experience, and is very involved in the community.
As we know the real estate market has been soft, with several years of declining numbers of transactions, which means that the increased population must rely on rental homes. In addition, most of the investors have chosen other investments over the last few years, which has left the Durango market in a shortfall for housing. As investors, we look at the return from the rents and we look at the return on appreciation. Historically, we have seen residential rents average about 4-6 % of the value of the homes, and the appreciation has been an average of about 8.6 % for Durango homes in the last decade, and nationally the appreciation has been about 6 %. This can easily offer a double digit return.
Rents were under the market value for years, as first time home buyers moved out of rental property and into their first homes, and likewise, investors were purchasing homes to rent, which coupled to provide a large supply of rental homes. It was a tenant market, and the large supply with the low demand created a soft rental market. Now, that supply has turned around, and it is much more a landlord's market, and they can more easily dictate the amount of rent, the terms, and be particular on the quality of tenant.
The last ingredient for a perfect investment recipe is the timing of the real estate market for purchasing. We all know that it is a buyer's market, and although the median price has remained stable, there are deals out there. Again, we are in the third year of lower number of transactions, and sooner than later, this too will turn around. As astute investor will take advantage of these market conditions, and benefit in the long run. (Please read the previous blog on comparisons to the last housing crunch)
Last, smart investors invest money in markets that produce the best return for the lowest risks. How do you feel about the stock market right now? In these economic times, is it likely to give you the returns that you are looking for? Are the assets hard, meaning do they have underlying intrinsic value like real estate? Are you pleased with the returns in the financial markets, such as bonds or CD's? Will these instruments meet your long term goals? If your answers point you to investment real estate, please give me a call. You can reach me, Don Ricedorff at The Wells Group, 970-375-7014, e-mail me at don@frontier.net, or visit me on the web at durangorealproperty.com.
Don Ricedorff is a licensed real estate broker in the State of Colorado, and he has numerous real estate designations including CCIM (commercial real estate), CRS, CRB, GRI, ABR, RSPS, and CIPS. He has 15+ years of real estate experience, and is very involved in the community.
Friday, July 4, 2008
It is the market and nothing but the market...so what do we do? Durango Colorado real estate market is a buyers market!
One of my favorite college professors, Dr. Tom Eckenrode, started a semester class with "why study history?". The best reason given was to help us understand and perhaps predict the future when circumstances are similar. This relates to our current real estate market. How quickly we forget. When the market is bustling, it seems like it will never stop, and when the market is slow, it seems like it will never pick up. History shows us differently. Let's look back at the last major downturn in the Durango Colorado real estate market. The market bottomed in 1989 when the average price of a Durango (In Town) single family residence sold for $81,385, an 8.6% drop from 1988. The very next year the average price increased to $97,902, a 20.3% increase! In the five years following 1989, the average price increased to $145,211, a gain of $63,826, which was a 78.5 % increase in value. At the end of 2007, the average value of a Durango residence was $448,649, a whopping 451 % increase since 1989.
Durango Colorado has benefited from a spectacular growth cycle in the last 20 years, as it has been "discovered", and the benefits for living here have been publicized. The combination of a historic mining supply town, a Victorian heritage, the Animas River, the two million acres of national forest, the skiing, biking, hiking, fishing, hunting, art, music, restaurants, and a real community have propelled growth. At the same time, let's not lose sight of what history is teaching us. The need and desire for housing will continue to increase in our community, in the State of Colorado, in our nation, and in the world, as population increases. The cost of building new homes will depend on the cost of materials, labor, the cost of government regulation, and the supply and demand of land. Today, we have an over abundance of homes on the market, which is causing a short term deflation in the cost of homes, while the cost of materials in the world is skyrocketing. What do you think is happening to the cost of steel, lumber, oil (forgive me for bringing that up!), and concrete in the world market as China and India are emerging as major consumers? Do you think the cost of these materials, labor and governmental regulation will be lesser or greater in five years?
History gives us the answer. There is an underlying inflation cost that continues to rise over periods of time. Sometimes, it is quite evident, and other times it is nearly obscure, like in the real estate market right now. If you have lived a full life time, this is not news to you, as you have seen the cost of goods and services increase over your entire life. If you are young and reading this post, ask your parents what the cost of a bottle of Coca-Cola was when they were growing up. Better yet, let me give you one to ponder. The average cost of a home in the United States was $9,075 in 1952! At the end of 2007, the average cost of a home in the United States was $218,900, a 6% annualized increase in value. I contend that we are seeing an underlying value increase in materials and labor right now, and yet we do not see it in the current price of real estate.
If you agree, what do you do? Do you anticipate the future and make decisions based on history or do you wait until we have a number of years of spectacular growth, and wished that you had been part of it?
The author, Don Ricedorff, is a licensed real estate broker with The Wells Group in Durango Colorado. If you would like to reach him, please call don at 970-375-7014, visit him on the web at http://www.durangorealproperty.com/, or e-mail at don@frontier.net.
Durango Colorado has benefited from a spectacular growth cycle in the last 20 years, as it has been "discovered", and the benefits for living here have been publicized. The combination of a historic mining supply town, a Victorian heritage, the Animas River, the two million acres of national forest, the skiing, biking, hiking, fishing, hunting, art, music, restaurants, and a real community have propelled growth. At the same time, let's not lose sight of what history is teaching us. The need and desire for housing will continue to increase in our community, in the State of Colorado, in our nation, and in the world, as population increases. The cost of building new homes will depend on the cost of materials, labor, the cost of government regulation, and the supply and demand of land. Today, we have an over abundance of homes on the market, which is causing a short term deflation in the cost of homes, while the cost of materials in the world is skyrocketing. What do you think is happening to the cost of steel, lumber, oil (forgive me for bringing that up!), and concrete in the world market as China and India are emerging as major consumers? Do you think the cost of these materials, labor and governmental regulation will be lesser or greater in five years?
History gives us the answer. There is an underlying inflation cost that continues to rise over periods of time. Sometimes, it is quite evident, and other times it is nearly obscure, like in the real estate market right now. If you have lived a full life time, this is not news to you, as you have seen the cost of goods and services increase over your entire life. If you are young and reading this post, ask your parents what the cost of a bottle of Coca-Cola was when they were growing up. Better yet, let me give you one to ponder. The average cost of a home in the United States was $9,075 in 1952! At the end of 2007, the average cost of a home in the United States was $218,900, a 6% annualized increase in value. I contend that we are seeing an underlying value increase in materials and labor right now, and yet we do not see it in the current price of real estate.
If you agree, what do you do? Do you anticipate the future and make decisions based on history or do you wait until we have a number of years of spectacular growth, and wished that you had been part of it?
The author, Don Ricedorff, is a licensed real estate broker with The Wells Group in Durango Colorado. If you would like to reach him, please call don at 970-375-7014, visit him on the web at http://www.durangorealproperty.com/, or e-mail at don@frontier.net.
Monday, June 9, 2008
When the real estate market is half-full, you need a high octane realtor!
These are difficult times in the real estate business. Durango Colorado has not been as deeply affected by the severe real estate market, as compared to many of the overheated markets like Southern California, Arizona, Nevada, and Florida. The Durango market is affected by the inability of buyers to sell their home in other markets, as there are many buyers that have a desire to purchase a home in Southwest Colorado, yet, they need to sell their home in another market first. We have also been affected by the economic downturn, and as most of you know, consumer confidence is at a multi-year low.
If you are a buyer or seller in this more difficult market, you need the help of a seasoned professional. We are way beyond the easy days of selling real estate, and when the worth of a Realtor was being questioned. It is quite obvious that the number of FSBO's (For Sale By Owners) has dwindled in the last 18 months. Those owners realize the importance of marketing a home for sale, and the days of a sign in the yard selling the home is in the past. Sellers need the attention of the fewer buyers in the market, and they have a difficult time reaching those buyers, without the use of a Realtor, and a strong marketing program. They also need professional help in pricing their home in an everchanging environment; it is absolutely critical to be competitive when there are numerous choices for the buyer. Besides making a decision to use a Realtor, a seller needs to be convinced in the choice of a Realtor. Obviously, Realtors are not all created equal. There is great differentiation in experience, marketing budget, negotiation skills, and education. This is the time to make a smart choice, selecting the Realtor that has the tools and skills to help you be successful.
In addition, the choice of the real estate company is equally important. A small real estate company may not have the marketing punch that you need in this market, and there are other impressive differences in selecting the best fit for you. For instance, The Wells Group (the company that I am associated) has a very strong internet presence to help reach those hard to find buyers.
If you are a buyer, the choice of a Realtor is equally as important. Strong negotiation skills and market knowledge can and will make a big difference in this market. The Realtor needs to have advanced knowledge and skills to help you find the right property, and to help you strike the best deal. You need a "connected" Realtor, that stays tuned into the changes and opportunities. This is the time when you will create future appreciation by purchasing when the market is at its weakest. You do not want to leave this to chance, find and utilize a top professional Realtor.
If you are looking in the Durango & Bayfield areas, and would like further information about this market or on my experience, please contact me. You can reach me, Don Ricedorff, at 970-375-7014, or e-mail me at don@frontier.net, or visit me on the web at durangorealproperty.com.
If you are a buyer or seller in this more difficult market, you need the help of a seasoned professional. We are way beyond the easy days of selling real estate, and when the worth of a Realtor was being questioned. It is quite obvious that the number of FSBO's (For Sale By Owners) has dwindled in the last 18 months. Those owners realize the importance of marketing a home for sale, and the days of a sign in the yard selling the home is in the past. Sellers need the attention of the fewer buyers in the market, and they have a difficult time reaching those buyers, without the use of a Realtor, and a strong marketing program. They also need professional help in pricing their home in an everchanging environment; it is absolutely critical to be competitive when there are numerous choices for the buyer. Besides making a decision to use a Realtor, a seller needs to be convinced in the choice of a Realtor. Obviously, Realtors are not all created equal. There is great differentiation in experience, marketing budget, negotiation skills, and education. This is the time to make a smart choice, selecting the Realtor that has the tools and skills to help you be successful.
In addition, the choice of the real estate company is equally important. A small real estate company may not have the marketing punch that you need in this market, and there are other impressive differences in selecting the best fit for you. For instance, The Wells Group (the company that I am associated) has a very strong internet presence to help reach those hard to find buyers.
If you are a buyer, the choice of a Realtor is equally as important. Strong negotiation skills and market knowledge can and will make a big difference in this market. The Realtor needs to have advanced knowledge and skills to help you find the right property, and to help you strike the best deal. You need a "connected" Realtor, that stays tuned into the changes and opportunities. This is the time when you will create future appreciation by purchasing when the market is at its weakest. You do not want to leave this to chance, find and utilize a top professional Realtor.
If you are looking in the Durango & Bayfield areas, and would like further information about this market or on my experience, please contact me. You can reach me, Don Ricedorff, at 970-375-7014, or e-mail me at don@frontier.net, or visit me on the web at durangorealproperty.com.
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