Summer News Letter – July 2010

A lot is happening out here in this crazy world! There has been the most rain in June I have seen and interest rates are up and then down. Real estate is now slowly rising from the ashes. As for my family, my oldest granddaughter is now graduating from high school!!! Wow!

OK, first things first.

Interest rates shot up to 5½ to 5¾%. In some instances this was quite the shock. After being around 4.5% for awhile, the rates slowly crept up to 5%, then BOOM. Over night, they shot up to as high as 5.75%! Well that lasted for about a month. Why? When the supply dwindles, everyone can ask what they want. For the past 6 to 9 months, when the rates shot up, the feds would pump money into the market to take them back down. This time it took awhile.

Here we go again. Whenever there is any opportunity to make a little extra money, you better believe there people, investors and banks that will pocket a little extra cash. Back to some greed – not total greed.

Anyway, rates are now about 5 to 5.25%. They will probably stay close to that for awhile. In mid-summer, real estate slows down a bit because of vacations, like July 4th, but not too much.

We are starting to see signs of real estate picking up. There are fewer foreclosures and the foreclosures in good areas see multiple offers. Now I don’t mean one or two offers, but 5 or 6 offers. A bank deal in Golden had 6 offers in 4 days. The bank deals are so much easier to deal with, by far, than short sales. The banks are saying short sales are becoming easier, however, not from what I’ve seen.

I waited for one couple for 5 months before the deal fell apart. We were waiting on another property for 2 months. We found a bank deal and we were done in a week, actually in less than a week!

For my money, existing homes on the market is still the way to go. Live people, still living in the homes, with real showings by realtors who we can make contact with (most of the time).

Still, location, condition and pricing – take your pick – a well priced home, in good condition, will still sell in a good area.

Now, to another subject. Ever notice the realtor who sends out notices that they sold this or sold that property? But you never notice anything ever mentioned about at what price the property was sold? Now I have no problem if someone asks me that question. Why? Because I never have anything to hide. Case in point – I had a realtor ask me what I thought a place was worth, mainly because I also live there and own in the area. I gave my opinion. Well, that person did not sell the property for that price, but instead, in one week the price was dropped by $10,000 and then eventually sold for an additional $5,000 off the original price – a price close to $150,000 – so why ask, me? The seller was an older person that in my opinion was taken advantage of. So, when someone says or advertises that “I Sold It” – ask!!! You may get an interesting answer.

So what is ahead for us? Well, more jobs sure will help! Jobs are the key. Not the incentives and other goodies that may still be on the way. However, what does it matter with the tighter qualification rulings still coming out. Some are long overdue, but to qualify, you still have to have employment! There is no secret to that. Tighter rules and more jobs will slow down and almost eliminate foreclosures.

The housing inventory is starting to dwindle. This may be a good sign, or this may be because sellers are afraid that housing prices have come down too much. My idea is that you should try it. Get a comparable analysis and you may be surprised. Good signs are starting to show up. Denver is in good shape for a recovery. Some think we are starting to recover now. Not the higher priced homes, though; there are lots of them on the market over $600,000 and above.

Now, for my family.

This June, my oldest granddaughter Rachel Reed graduated with Honors from Worthington High School, just north from Columbus Ohio - a real nice suburb. And to boot, she received a real nice scholastic scholarship to Denison, in Granville, Ohio. Denison is a very nice, small, older school with a total of 2,200 students.

I was busting a few buttons on that one, I can tell you that. Rachel is a great young lady who loves to study, bright and is full of fun. Congratulations from Poppa Joe!

Then Leah, Rachel’s sister and my youngest grandchild spent a great week in Colorado with us. We went for a hike up to Isabel Glacier… at least we tried anyway. There was still a tremendous amount of snow for the 4th week in June and we needed more than hiking boots to complete the hike. But still pretty neat and beautiful scenery. We also took in a Rockies game and it was nice to see them turn their season around.

It’s been a pretty good spring and summer for local baseball and basketball and Bronco season is just around the corner. Magnet schedules will be coming out the 3rd week in July.

Ok Denver Area – keep the faith! As far as housing goes, it will come back nicely. I am seeing a slow change in the attitude already. Hang in there!!!

Thanks,

Joe Bilicki