March 2009 Auction for over 200 foreclosed homes in Colorado

Over 200 foreclosed homes are to be sold at this auction.

When: Saturday, March 21st
Where: Colorado Convention Center
Exhibit Hall B
700 14th Street
Denver CO 80202
Time: Registration at 8:00 a.m.
Auction at 9:30 a.m.

For additional information including a list of properties contact us.

American Recovery and Reinvestment Act

What does it mean for real estate and the economy in Denver?

This $780 billion dollar package has many elements that will impact the real estate industry market trends and forecast for 2009. Here is a breif synopsis of key real estate provisions in the bill.

Home Buyer Tax Credit - This bill provieds for an $8,000 tax credit that would be available to first-time home buyers for the purchase of a principal residence on or after January 1, 2009 and before December 1, 2009. Most of the mechanics of the credit will be the same as under the 2008 rules: the credit will be claimed on a tax return to reduce the purchaser's income tax liability. If any credit amount remains unused, then the unused amount will be refunded as a check to the purchaser. The cost of the program is $3.7 billion, less than 1 percent of the overall stimulis package. The benefit will be felt widely as first time homebuyers move to take advantage of low housing prices triggering trade-up perchases. The tax credit is likely to boost home sales by 300,000 first-time buyers in 2009.

FHA, Fannie Mae and Freddie Mac loan limits - The bill reinstates the 2008 loan limits for FHA, Freddie Mac and Fannie Mae loans. These limists were equal to the greater of 125% of the 2008 local area median home price or $271,050 for FHA and $417,000 for Fannie and Freddie, with an overall maximum cap of $729,750. For a few areas where the 2009 limits were higher, the higher limits will apply. In addition, the bill includes language providing the HUD Secretary with the discretion, if warranted to increase the loan limit for any "sub-area", i.e. an area smaller than a county. The Secretary's discretion is again limited by the $729,750 cap. These 2009 limits will expire December 31, 2009. The higher loan limit will permit more home buyers and homeowners to access lower interest loans as Fannie Mae and Freddie Mac will now be able to buy those loans. The loans for amounts above the limit are jumbo loans that carry very high interest rates. The provision will provide more people the ability to refinance at a lower rate and provide more people the ability to lock in lower interest rates for purchases. This is good news for thos in higher -end markets. The highend market has been stalled and this measure provides some relief. The high loan limit is likely to raise home sales on the high-end by 150,000 in 2009.

Neighborhoos Stabilization - The bill provides $2,000,000,000 in additional funding for the Neighborhood Stabilization Program (NSP). The NSP provides grants through the Community Development Block Grant program CDBG to states and localities to address the problems that can be created when whole neighborhoods are decimated by foreclosures. The funds can be used to purchase, manage, repair and re-sell foreclosed and abandoned properties. In addition the funds can also be used by states and localities to establish financing methods for the purchase and redevelopment of foreclosed properties. After purchase the homes must be used to assist individuals and families with incomes at or below 120% of area median income. Twenty-five percent of funds must be used for households with incomes at or velow 50% of area median income.

Will the election of the 44th President change our housing market?

While I think that the President elect Barack Obama will make changes to aid our economy, I don't think that he will have a huge impact on the housing market. Over time I believe some of the economic changes he makes will impact our market in a positive way, but just because we have chosen our next president will not make people go out and decide to buy a house. I think people still buy and sell for the same reasons. They need to move for work, their family is growing or they are empty nesters, some simply move just for a change. The golden rule to real estate is that over time it is one of the best investments that you can make. Over time your home will appreciate. Over time our market will recover, there is no overnight fix. If you are thinking about buying right now rates are still historically low and you will get an awesome deal on a house, and yes over time you will gain equity, just not over night like in the past. If you are an investor now is a great time to invest and over time your investments will pay off. Real estate has always been one of the best investments you can make and even in troubled times is still the best investment you can make for yourself and your family's future.

The market in Jefferson County Colorado is showing signs of improvement and I believe it will continue to. We definitely are better off than other parts of the nation. Something we should all be thankful for.

I am in the market to buy a home. Is now a good time to buy?

Now is absolutely a wonderful time to buy! The Home Purchase Tax Credit for first time buyers is one of the reasons why it’s a great time to buy NOW as opposed to waiting.
Lower prices, a huge abundance of inventory for sale, sellers that are getting more desperate by the month (at least the serious ones are)…all of this is what creates a very strong negotiating position for the buyers side of the transaction.
What do you risk by waiting?

Rising Interest Rates
If interest rates start going up by any significant amount, you are losing all the benefit of buying the home for a lower price because your interest payments will go up significantly.

Losing the Home Buyer Tax Credit
That’s a $7,000 interest-free loan from the government that you WON’T get if you wait to buy…it’s free money!

The market could turn around before you know it.
From my experience, it takes 2-3 months for real estate agents to know that the market is changing direction…it takes another 2-3 months beyond that before the average buyer/seller realizes the shift (How many people do you know who didn’t believe their Realtor when told that the market was no longer going up 2 years ago? How long did it take them to come around and realize the shift?)

We tend to give all my buyers the same basic advice.
If you are buying a home in a downward trending market, understand that you’re buying a HOME…not a cash cow. Plan on living in it. Plan on staying. There is no better long-term investment than real estate - but it’s the long term that makes it a safe bet…the only time you get into trouble is when you HAVE to sell (if the investors who got burned didn’t have to sell, they could have taken their properties off the market, waiting for it to turn around, and then sold for a great profit…but their hand was forced because they were (mostly) in over their head. Buy a HOME first…investment second, and you will be absolutely thrilled with the deals you can get in today's marketplace…just please don’t turn around and want to sell next month for a $35,000.00 dollar profit!

Denver's Real Estate Market is getting stronger!

Good news to report! The Denver Post published an article this week with the following excerpts from it.

Colorado's largest mortgage lender is making it easier for homebuyers to borrow money.
Wells Fargo Home Mortgage on Saturday upgraded the status of the Denver metropolitan area's real-estate market from "distressed" to "stable."
"The fundamentals in the Denver market are changing," said Greg Osborne, regional vice president of the mortgage company. "Inventory is being worked down, and as a result, prices are stabilizing."
There were 24,648 homes on the market last month, a 20 percent drop from August 2007's 30,827 homes, according to data released last week.
The improved status of the market means consumers can borrow 5 percent more than they previously could, Osborne said.
"I am hopeful that it will stimulate demand by increasing confidence in our market," he said. "We may have led the nation into the doldrums, but we're again leading out of the doldrums."

The Standard & Poor's/ Case-Shiller U.S. National Home Price Index dropped 15.4 percent for the one-year period that ended in June. Denver, however, was down only 4.7 percent for the period and has shown three straight months of price growth.

We have been telling many of our buyers that even though the stock market has been volitale and the media as usual as been reporting doom and gloom. It is important to remember that real estate is a local market, not a national market. The Denver market appears to be on the verge of swinging up if not already. If you are thinking about buying. Now is the time, interest rates are low and real estate is "on sale". Contact us today or start your home search by visiting our website www.ColoradoSuccessTeam.com.

Source: Denver Post Business Section
Article date: 09/15/2008 12:32:40 AM MDT
Author: Margaret Jackson

Real Estate Investor's Tax Alert

Here's a tax alert for real estate investors who use popular tax-free exchanges: The recently signed federal housing legislation contains a hidden zinger that could cost you thousands of dollars if you don't plan around it.
As of next January 1st, investors who exchange into rental or second home properties that they later convert into their personal homes no longer will be eligible for the full $250,000 to $500,000 tax-free exclusions now available on sales of principal residences.
Instead, they'll need to allocate their time of ownership between taxable investment or second home usage and non-taxable principal residential usage.
To qualify for tax-free exclusions they'll still need to use a property as their primary home for two out of the five years preceding any sale or exchange. But if any part of their total usage time after January 1st is what the new law calls "nonqualified" -- that is, investment, rental or second home use - then that will lower their maximum exclusion.
This an especially big deal for investors using "Section 1031" exchanges because they frequently shield their real estate gains on rental houses and condos by moving into them for a couple of years and converting previously taxable gains into non-taxable principal residential profits.
An example of the dollars and cents impact of the change was provided by the Federation of Exchange Accommodators, a national trade group representing investors and intermediaries. Under the old law, an investor could exchange into a property that he or she then rents out for three years. Then the investor would move in and use the property as a principal residence for two years.
When the investor -- who is single -- sold the house for a $300,000 gain, $250,000 of that amount would be tax-free under the old law.
Under the new law, three fifths of that gain -- $180,000 out of the $300,000 -- would be taxable, while just $120,000 would be tax free.
That $130,000 difference is why exchange investors are so upset with Congress's latest tax increase.