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Summit County Market Reports

by Allison Simson

We are just about at the 1/2 way mark for the year 2012.  Where are we? What is going on in the wide world of Real Estate in Summit County?

For all the details, click on the links below!

1) Breckenridge
 
 
2) Dillon
 
 
3) Frisco
 
 
4) Keystone
 
 
5) Summit County
 
 
6) Wildernest_Silverthorne

8 things to know about buying a home today

by Allison Simson

Question:  Allison, we are interested in buying property in Summit County, CO.  What should we be on the lookout for?

Answer:  The home-sale market is showing signs of life. More buyers are confident now than they were a year ago that now might be a good time to buy. Interest rates are near all-time lows and home prices in some areas nationally are back to 2002-2003 levels.  In Summit County, the prices are back to 2005-06 levels in many areas.

According to Dianne Hymer, with Inman News some analysts are finally suggesting that we may be headed for recovery. If you have a secure job, plan to stay put and feel this is the right time for you to buy a home, consider the following.

In most places in the country, home prices are still declining. It has only been recently that the market picked up and it's too soon to know if this will result in a sustainable increase in prices.

The recent home sales in areas around California's Silicon Valley defy the norm. Significant job growth in the area combined with a low inventory of good homes for sale has resulted in multiple offers with buyers bidding the price up sometimes hundreds of thousands of dollars over the asking price.

In other high-demand, low-inventory areas, you may find yourself bidding against other buyers, perhaps even more than once. This doesn't necessarily mean that the price will be bid up significantly over the asking price. This will vary from one listing to the next depending on property location, condition and price.

It's important to research the local community where you want to buy. Find out what homes are selling for, if multiple offers are common and if listings are selling for more than the asking price. This will help you make a realistic offer that might be accepted when you find a home you'd really like to buy. It helps to work with an experienced local real estate agent.

Some sellers in high-demand niche markets intentionally list their home at a low price hoping to stimulate multiple offers. If you see such a listing and there are a lot of buyers wanting to make offers, you will be better able to know how high your offer would need to be to win the contest if you have done your due diligence.

HOUSE HUNTING TIP: Whether you're anticipating competition or not, you should be preapproved for the mortgage you'll need to complete the purchase before you write an offer. In competition, this will make a big difference, particularly if everyone else who is offering is preapproved. It also lets you know what you can afford. And, it puts you in a good bargaining position with the seller.

Buyers aren't the only participants in the housing market that have heard the news that the market has improved. Some sellers are putting their homes on the market because they've been waiting for a better time to sell. This is good news for buyers looking in low-inventory markets.

You should expect that you will have to negotiate. Many of today's sellers are selling for less than they paid. Even though the market has improved a bit, sellers may be disappointed with the current market value of their home. Be prepared to negotiate, not just the initial price, but after inspections are completed if items come up that you hadn't anticipated.

Include realistic contingency time frames in your purchase contract for loan and appraisal approval if you're applying for a mortgage. The recent uptick in the market means that lenders are suddenly overwhelmed.

THE CLOSING: Underwriters could require that additional conditions be met before you can be approved. Act quickly to avoid further delay.

 

 

For answers to your real estate questions, call Allison at 970-468-6800. Email - [email protected]. Her philosophy is simple, whether buying or selling, she understands that the most important real estate transaction is yours.  Want to know the value of your Summit County property? Visit www.SummitHomeValue.com  

What to expect from FHA's pending condo rule revisions

by Allison Simson

Officials shed light on issues to be addressed

Question:  Allison, we want to buy a condo in Keystone, CO, but we have heard that it is difficult to get condo financing.  We need to get a loan to purchase – do you know what the current status is?

Answer:  You are correct that financing regulations for condos can be difficult,  but certainly not impossible!  The best step you can take is to work with a local lender that knows the area and the ins and outs of lending on resort property.  Aside from that, here is some information from Inman News regarding what is happening in Washington:

When acting FHA commissioner Carol Galante told a standing-room-only audience at NAR's midyear meeting last week that "we have heard you" on condominium issues -- and that FHA would publish revisions to the agency's controversial rules "very, very soon" -- she provided no details about what specific modifications the industry and consumers could expect.

Some audience members speculated: Will the changes be enough to bring back FHA financing of individual condo units to thousands of communities across the country that no longer are certified?

Will they be enough to open up financing to first-time buyers who seek to use low down payment FHA loans in places like Las Vegas, Miami, Phoenix and dozens of other markets where investors have purchased large percentages of condo projects, rendering them ineligible for FHA approvals under current rules?

Could Galante and HUD simply throw in the towel and scrap -- or suspend -- the whole package of heavily criticized requirements, given the sharp decrease in FHA condo volume this fiscal year?

First, there's zero chance the whole package of rules will be put on ice or withdrawn. The rules were adopted following FHA studies of key factors associated with high default and claims rates in condos, plus a general perceived need to keep in much closer touch with the financial health of condo projects -- their budgets, reserves, insurance coverage and compliance with state and local regulations that could affect their viability.

However, there's an excellent chance that some of the specific requirements that have bugged associations and unit sellers will be modified in a two-step process scheduled to begin shortly. FHA plans to issue a mortgagee letter to lenders in the near future that revises a number of the current rules.

But it's also working on drafting a full-blown regulatory proposal that will allow the industry and public to weigh in on the pros and cons of the proposed rules -- an opportunity that was conspicuously absent when the current rules were promulgated.

Once those comments are digested, the agency will publish final regulations designed to govern the condo financing program for the long term. Timeline on that: Probably sometime in 2013. During the interim, the rule changes outlined in the soon-to-arrive mortgagee letter will be in effect.

So where's the meat here? What areas of the current rules are most likely to be changed?

High on the list: The agency intends to soften and clarify some of the "project certification" language in the current package that condo associations and builders must sign. In its current form, the certification has terrified many condo board officers -- typically volunteers from the resident base -- that they are assuming overly broad, lifelong legal responsibilities to inform FHA every time there is a material change in any of the information submitted, including enactment of state or local regulations that might affect the project. Under earlier rules, condo association attorneys could take on legal liability for the accuracy of the submission.

The current language also requires condo board members to attest that they have "no knowledge of circumstances or conditions that might have an adverse effect on the project or cause a mortgage secured by a unit" to become delinquent, including "disputes concerning unit owners" and "dissatisfaction among unit owners about the operation of the project or the owners association." Any board member who "knowingly and willfully" submits information found to be false to FHA as part of the certification is subject to fines up to $1 million and 30 years in prison.  

Andrew Fortin, former government affairs head for the 30,000-member Community Associations Institute (CAI) and now vice president of the national management firm, Associa, asks, "Would YOU sign something like this?" Homeowner association leaders in droves have declined to, and their projects are among the thousands no longer certified by FHA for unit financings.

Other changes coming:

  • Condo fees in arrears. Under the current rules, no more than 15 percent of the total units in a project can be more than 30 days past due on the condo fee payments. Look for an extension of the delinquency standard beyond 30 days -- maybe double or triple that timeline -- or an increase in the percentage threshold beyond 15 percent.
  • Investor ownership limits. The rules now prohibit more than 10 percent of the units in a project from being owned by a single investor. This has created significant problems when a developer sells out most of a project but retains an unsold portion in its own name for a period of time, for sale or rental. Look for a relaxation of the rules here.
  • Concentration of FHA loans. Currently no more than 50 percent of the units in a project can carry FHA financing -- a limit that creates problems for some projects aimed at lower and moderate income buyers, who are often first-timers and minorities. FHA is looking hard at raising that ceiling.  
  • Non-residential, commercial space. The agency now limits a project's commercial usage to 25 percent of total floor space. This is tough on some condos in urban areas where retail or office space rents help pay the bills, but the requirement is likely to be changed to accommodate those projects' needs.

One  controversial area that may not see much in the way of modification: Non-owner occupancy. The current rule limits rentals to 50 percent of all units. FHA believes this standard is consistent with Fannie Mae and Freddie Mac rules, though there could be some wiggle room if second home/vacation home units are counted on the owner-occupied side of the ledger.

 

For answers to your real estate questions, call Allison at 970-468-6800. Email - [email protected]. Her philosophy is simple, whether buying or selling, she understands that the most important real estate transaction is yours.  Want to know the value of your Summit County property? Visit www.SummitHomeValue.com  

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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