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Tough lending in Summit County

by Allison Simson

Unless you have been living in a cave in the hills, you have heard about the credit crunch and tight lending practices borrowers are encountering today.  In Summit County, buyers of condos and townhomes are having an even tougher time since the lending pendulum has swung so radically in the other direction.  I've sent this letter to some folks in Washington to keep us on their radar.  Thought you might find it interesting.

"As lending practices continues to tighten, it has become exceedingly apparent how this affects our economy in Summit County.
 
Current Fannie Mae Guidelines indicate perfectly sound and warrantable condominium projects in Summit  County may be denied any financing possibilities simply because they are located in a "resort" area or because individual unit owners may rent their units on a nightly basis. Furthermore large banks are adding additional cumbersome barriers restricting financing  because many condominiums do not have individual meters for gas and electric services or because the word "lodge" is in the name.  These are examples of unreasonable and unfounded restrictions that are severely hindering buyers trying to purchase condos in our area.
 
If lenders had the ability to loan judiciously to a fireman or a teacher or other permanent residents who's main option for housing is a condominium, we would see more building, more jobs and a good beginning of economic recovery.  Second homeowners are also hurt by these restrictions and are finding it increasingly difficult to purchase property in Summit County. Healthy resort areas are one of the major heartbeats of Colorado.   
 
When people think of Colorado, they think of mountains and fishing and snow and skiing. Tourism is the second largest economic driver in Colorado.We also rely on tourists to buy  second homes in Summit County furthering jobs and promoting a healthy economy.
 
We need your help and strongly urge you to help reopen the financing doors from FNMA and FHLMC.
 
Thank you in advance for your consideration and help!"


Certainly, the lending practices had gotten far too lax, but to penalize strong, stable complexes with few to no foreclosures on their books seems irresponsible in the other direction!  

We do have a few great lenders who are able to finance condos in Summit County- up to 90%.  Please call if you'd like more info.

 

Should we remodel before we sell?

by Allison Simson

We are always asked by many sellers whether they should remodel their homes or condos before they sell.  According to the annual Remodeling Cost vs. Value Report by Remodeling Magazine, and Inman News it still pays to remodel.  Their survey identifies most cost-effective home improvements

The home-sale market has taken a beating throughout the nation in the last few years, which begs the question: Does it makes sense financially to invest in home improvements? According to Diane Hymer of Inman News and Remodeling Magazine's annual Remodeling Cost vs. Value Report for 2009-10, published in agreement with the National Association of Realtors, indicates that remodeling still pays off, but more so on less expensive projects.
Most high-end remodeling projects don't return dollar for dollar on the investment even in a good market. That is, unless homes are appreciating at a fast clip. In this case, you might get your money back due to appreciation. But the profit on the sale might not be as much as it would have been if you hadn't done a high-end renovation.
Just as today's homebuyers are making pragmatic decisions, so are today's homeowners when it comes to making improvements.


These projects returned from 71 to 83 percent nationally depending on the materials used. The project that paid back the highest return was a midrange front-door replacement that cost approximately $1,200 and returned an average 128.9 percent nationally.
Sellers may wonder why it would make sense to invest in an improvement just for the sake of selling if it won't repay the amount invested. In today's challenging home-sale market, these improvements may be warranted for the home sell at all if there is a lot of inventory in your neighborhood. Buyers expect more for their money and gravitate to listings that are in the best condition for the price.
HOUSE HUNTING TIP: Be judicious about how you spend your money fixing your home up for sale. For example, if your kitchen is a disaster, it makes more sense to do a midrange than an upscale renovation. According to the Remodeling Cost vs. Value Report, a midrange minor kitchen upgrade will return an average of 78.3 percent nationally. A major upscale kitchen remodel will pay back only 63.2 percent
The Cost vs. Value Report recommends the following cost-effective improvements you might consider to prepare your home for the market: tidying up the kitchen cabinets using organizers will make your cabinets roomy; add an inexpensive tile backsplash to a tired kitchen, and use inexpensive tile to give an old bathroom a new look; add a breakfast bar by cutting an opening between the kitchen and family room; and install granite tile rather than slab.
Other suggestions include: replacing outdated light fixtures; freshening up the basement; giving the kitchen cabinets a new look by reconditioning and adding new knobs or having cabinet doors and drawers replaced; updating a bathroom without replacing tile by changing the medicine cabinet, light fixtures, vanity, cleaning the grout or replacing it and adding glass shower doors.
THE CLOSING: Before starting any fix-up-for-sale projects, seek your real estate agent's advice so that you don't waste money on improvements that won't pay back much in your area.

If you have specific questions about fixing up your place, please don't hesitate to call.  Or, if you'd like a copy of our special report "Staging Your Home", just let us know and we'll send it to you. We're here to help! 

It still pays to remodel

by Allison Simson

Survey identifies most cost-effective home improvements

Question:  Allison, we are considering selling our Keystone condo in a year or so and would like to do some updating and remodeling before then.  Is it a good idea to fix our place up and put money into it before selling in this market?

Answer: Yes. And no. The home-sale market has taken a beating throughout the nation in the last few years, which begs the question: Does it makes sense financially to invest in home improvements?

Remodeling Magazine's annual Remodeling Cost vs. Value Report for 2009-10, published in agreement with the National Association of Realtors, indicates that remodeling still pays off, but more so on less expensive projects.

Most high-end remodeling projects don't return dollar for dollar on the investment even in a good market. That is, unless homes are appreciating at a fast clip. In this case, you might get your money back due to appreciation. But the profit on the sale might not be as much as it would have been if you hadn't done a high-end renovation.

Just as today's homebuyers are making pragmatic decisions, so are today's homeowners when it comes to making improvements. Most of the remodeling projects with the largest return were for such things as replacing exterior siding and windows. On average the cost involved was less than $14,000, according to Remodeling Magazine.

These projects returned from 71 to 83 percent nationally depending on the materials used. The project that paid back the highest return was a midrange front-door replacement that cost approximately $1,200 and returned an average 128.9 percent nationally.

Sellers may wonder why it would make sense to invest in an improvement just for the sake of selling if it won't repay the amount invested. In today's challenging home-sale market, these improvements may be warranted for the home sell at all if there is a lot of inventory in your neighborhood. Buyers expect more for their money and gravitate to listings that are in the best condition for the price.

HOUSE HUNTING TIP: Be judicious about how you spend your money fixing your home up for sale. For example, if your kitchen is a disaster, it makes more sense to do a midrange than an upscale renovation. According to the Remodeling Cost vs. Value Report, a midrange minor kitchen upgrade will return an average of 78.3 percent nationally. A major upscale kitchen remodel will pay back only 63.2 percent

The Cost vs. Value Report recommends the following cost-effective improvements you might consider to prepare your home for the market: tidying up the kitchen cabinets using organizers will make your cabinets roomy; add an inexpensive tile backsplash to a tired kitchen, and use inexpensive tile to give an old bathroom a new look; add a breakfast bar by cutting an opening between the kitchen and family room; and install granite tile rather than slab.

Other suggestions include: replacing outdated light fixtures; freshening up the basement; giving the kitchen cabinets a new look by reconditioning and adding new knobs or having cabinet doors and drawers replaced; updating a bathroom without replacing tile by changing the medicine cabinet, light fixtures, vanity, cleaning the grout or replacing it and adding glass shower doors.

THE CLOSING: Before starting any fix-up-for-sale projects, seek your real estate agent's advice so that you don't waste money on improvements that won't pay back much in your area.

 

For answers to your real estate questions, call Allison at 970-468-6800. Email - [email protected]. Are you looking to purchase property in Summit county, but not ready to speak with a Broker yet?  Go to www.SummitHomeBuyer.com for a list of properties that meet your criteria!

Real estate's 'fear factor' waning?

by Allison Simson

Economist sees hope in first-time buyers, pent-up demand

Question:  What do you see on the real estate horizon? 

Answer: I wish I could consult my real estate crystal ball, but alas, it’s in the shop getting some work done!  There is so much speculation about real estate in the media today it’s difficult to discern what is reality and what is fantasy.  But according to Inman News Group, while most housing analysts believe there will be no double-dip recession, the number of foreclosures will continue to hound the industry in 2010.

"The only guys predicting a double-dip recession are guys who want to make a name for themselves," said John Tuccillo, national residential consultant and the former chief economist of the National Association of Realtors.

"If they can call this one right, everybody will remember them. But, in reality, it will be a long, grinding, slow recovery. Banks are sitting on too much cash now for a double dip, and I don't think most people see that happening."

Lawrence Yun, the present NAR economist, expects the $8,000 first-time homebuyer credit extension to continue to stimulate the lower end of the market, influencing the entire housing ladder. As more first-timers move in, others move up.

About 47 percent of all home sales in 2009 involved first-timers, up from 41 percent in 2008 and 36 percent in 2006. Yun believes that number will continue to rise because of an estimated 16 million renter households making enough money to qualify to buy homes. Demand should remain strong in 2010 and restore confidence for all potential buyers.

"I don't think the fear factor will be at play in 2010," Yun said. "We're seeing price stabilization on a month-to-month basis."

Yun's numbers show the pool of first-time buyers is 5 million more than in 2000, and thus represents pent-up demand. In his opinion, if the credit continues to have the same impact on demand in 2010, overall house prices will rise 3-5 percent this year and sales will be up "conservatively" 15 percent.

It remains to be seen if the first-time homebuyer program -- plus the new $6,500 credit for existing homeowners -- will generate enough energy to eliminate the fear factor this year. People simply postpone a buying decision if they believe home prices will continue to go down.

The stewing pot is the number of foreclosures heading to the market. Some lenders, deluged with active foreclosures, are way behind with some borrowers who are 16-20 months behind in their payments. These properties have yet to hit the market as foreclosures. Yun predicts 2.2 million foreclosures this year.

Let's hope that fear factor is quickly eliminated in 2010. Let's hope people will regain the confidence -- and guts -- to make their payments or seek a realistic, honest solution.

 

For answers to your real estate questions, call Allison at 970-468-6800. Email - [email protected]. Want to know the value of your Summit County property? Visit www.SummitHomeValue.com   

Tuesday Coffee Break ~ Getting a loan?

by Allison Simson

Happy Tuesday Morning to you!

Getting a loan?  It could be easier now for you to "shop around" to pick the most cost effective loan...or not, depending on your point of view!

Recent guidelines from Washington have forced a change to the way that loan originators will disclose closing costs for all homebuyers. The purpose of the new Good Faith Estimate is to level the playing field for borrowers comparing loans to be able to make apples to apples comparisons for loan scenarios.

In essence, HUD is working to bring all lenders up to the same standard of excellence in reporting closing costs that I have always adhered to, estimating realistic fees that a buyer should expect to pay at closing with no last minute surprises.

What are the important facts you should be aware of in having conversations with homebuyers? Below are some important points to know:

All fees paid to the lender/broker are to be consolidated in one line, including processing fees, origination fees, etc. These charges cannot change from the original estimate without a material change to the loan requested.
In the event fees are being charged to obtain a lower rate, these are to be broken out and itemized for the borrower's ease of comparison to other loan programs.
Estimates for fees from government recording charges and third party settlement providers we suggest are to be itemized and the lender is held to a tolerance of 10% for their accuracy. In the event the estimated charges exceed the amount listed by the allowable tolerance, the lender will be responsible for making up the difference.
Estimates for services that the buyer can shop for and do choose can change at settlement without the lender being held accountable. This can include title charges, homeowner's insurance, and initial deposits for an escrow account.

In some ways this new form will be easier to understand, and more difficult in others!  We know some great lenders, so if you're looking, please give us a call. We're happy to help! 

"There are two ways to live your life. One is as though nothing is a miracle. The other is as though everything is a miracle."   —Albert Einstein

Did you hear? STAR POWER Conference is back!

by Allison Simson

It's official ... STAR POWER is being re-launched under new leadership! As a STAR POWER Star it's incredibly exciting to be involved in the continuation of STAR POWER into a new era of industry leadership.  Since you are a part of my database you automatically get $100 discount to this event.

The 2010 Conference has been booked and this years key note speaker is Dave Ramsey . I do not personally profit if you sign up on my recommendation, but if you try to sign up without going through me it is going to cost you extra money.  Us the link below to get the discount.

http://www.gostarpower.com/go?w=conference&p=a434

STAR POWER also has a new saying that fits perfectly with the organization's goals:

STAR POWER is ... Success Shared™.

I'm proud to be a part of this extraordinary organization helping thousands of agents across the country learn how to be more successful, both professionally and personally.

Agents interested in elevating their business should definitely look into going to STAR POWER Conference. Again, the site is:  http://www.gostarpower.com/go?w=conference&p=a434

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Photo of Summit Real Estate Real Estate
Summit Real Estate
The Bright Choice
330 Dillon Ridge Way, Suite 10
Dillon CO 80435
970-468-6800
800-262-8442
Fax: 970-468-2195

Allison Simson, Owner/Broker, is a licensed Colorado Real Estate Broker