Walters & Company Newsletter

newsletter-opening-header

wnc-group-photo

 

Monthly Market Update

The market stays robust for Denver in the month of October even though we see our lowest inventory in 30 years. You can see below sales price and sold price continue to rise and that there has been no change in days on market, year-over-year or month-over-month.

1

12

2

What Do We Mean When We Say “Average”?

Of the homes that sold in October, the average detached single family home was 1,849 square feet, 4 bedrooms, 3 bathrooms and was built in 1979. The average attached family home (i.e. Condo) was 1,239 square feet, 2 bedrooms, 2 bathrooms and was built in 1987.


adams-web-2


looking-to-sell-what-are-the-odds-2

signature-banner-2

Powerful Economic Data from Lawrence Yun……

Doctor Yun, Chief Economist for the National Association of Realtors, was in Denver at the end of April and shared lots of Data with the local Denver community of Realtors. His over all opinion of the Data was positive for the Housing Market for Denver and for our Nation as a whole. Below are some Data Points for you to browse from his speech:

  • We lost 8 mil jobs in the recession and have since added 12 mil
  • unemployment insurance claims at a 15 year low
  • Denver alone has added about 300,000 jobs since 2010 (could explain low inventory)
  • Household net worth at all time high Nationally
  • Vacation home Sales have doubled in the past two years
  • Pent up demand for housing is at an all time high, construction still sluggish
  • Since 2000 our population has grown by 37 million in 2014
  • 2000 New Homes Sales 880 K vs 2014 New Home Sales 440K
  • Average income is on the rise in Denver and while there have been negative pressures from the Engery sector the other parts of our economy are doing enough to offset them
  • 36% of all US folks Rent this number will trend higher as loans continue to be difficult to get and because we don’t have enough inventory for the 1st time home buyer sector.
  • The Landlord market will stay strong in Denver until we have enough rental units to keep pace with our population growth. This could be awhile.
  • Construction has been slow to re-bound in Denver mainly because of lack of land and backlogged city construction permits.
  • Looking for rates to be higher in 2016
  • Continued low inflation rates

Just some points from his talk…if you would like the slides I am happy to provide them to you! Just send me an email at 5280walters@gmail.com and I will get them over to you in a jiffy!

Nowhere to Hide

As the stock market has made its wild gyrations in the past week or two and the Dow Jones Industrials have given us a nearly 1,000 point range in just a half dozen sessions, people are starting to sit up and take notice of the volatility that can enter the equity markets almost overnight. Ask anybody with any real knowledge of the markets and they will tell you that the vast majority of activity is generated almost entirely by machines. Algorithms and high-frequency trading account for about 70% of the activity in the markets today. What does that mean? Well, it means that all of this volatility preys on it self. Volatility begets volatility. Why does this matter? If you own any stocks, bonds or mutual funds, they are all subject to being influenced by all of this phantom activity. Your investment portfolio can whip around several percentage points while you aren’t even looking, and it can happen fast. I’m not going to lie to you, as a former trader for over 30 years I would lay in wait for activity like this. The emotional swings equaled opportunity for us short-term players that were just waiting for somebody to make a reactionary move. It was money in the bank. However, volatility is not a true long-term investors friend. When we enter into an investment, we want to have a reasonable expectation that it will make us a decent return over time but more importantly not evaporate before our eyes. Recent data suggest that we baby boomers are overweight equity investments in our portfolios. Check out this article from last week. http://money.cnn.com/2014/10/16/retirement/baby-boomers-stocks/index.html?section=money_latest

Blog Volatilty chart copyI left a lifetime of living and breathing the stock market to capitalize on all the opportunities that are being presented to us by real estate; I can’t count the number of people that I have spoken to in the last year or two that are nervous about real estate investment. They fear another bubble. I don’t see it anytime in the near future. Bubbles are characterized by an overwhelming belief in a “sure thing”. An environment where everybody and I mean everybody is chasing the same thing. Think new tech stocks in 1987 or dot-com stocks in 1999 & 2000 or brand new houses with no money down or no earnings documentation in 2004 & 2005. That is not what I see in the real estate market today. There is doubt. There is hesitation. That is a good thing. It means that the folks that have the intestinal fortitude to take a chance will be rewarded. The “bubble” was created be unbridled greed amongst the large banks and fueled by horrible, enabling government policy. Those influences don’t exist today. Those policies are in check now. Couple that with the fact that the largest generation in the history of mankind is entering the home buying stage of their lives. The millennials in the United States number about 90 million compared to about 70 million baby boomers (the previous largest generation). That is an enormous group of people and I don’t think they will be living in their parent’s basement forever. The opportunity to invest in real estate has never been better. Think about the impact that we baby boomers had when we all came into the home buying stage. That was the early 70’s and ran until the late 90’s, I would say that was a very opportune time to invest. The average home cost about $25,000 in 1972, by 1998 it was up to about $160,000. I would say that is quite a move. Back to the title of this post, is there really nowhere to hide? If you have read this far then you know the answer. A portion of your investable assets should be in real estate. The returns are excellent and a good property can generate superior cash flow for years to come. Let us help you find a property that will fit your budget and serve to add some diversification to your investment portfolio. Did you know that you can use 401K or IRA money to invest in real estate? Call us today to find out how. We can help you add some peace of mind to your portfolio.

Willie Walters, ReInvestment 303-908-2330

Denver Business Journal Reports that Denver Home Prices are…

Denver-area home-resale prices rose an average 9.1% in March from a year earlier, and also were up 1.4% from February, reaching an all-time high level, according to the latest S&P/Case-Shiller report. The Denver area’s year-over-year price gain was the same as in February, and marked the 15th straight month with a year-over-year price increase of 8.9% or more. Denver metro area home prices were up 9% year-over-year in both January and December 2013.

But while home prices in metro Denver edged down 0.1 percent between January and February, they rose a robust 1.4 percent between February and March, topping the average gain for 20 cities tracked by the closely followed Case-Shiller report series from S&P Dow Jones Indices LLC, based on non-seasonally-adjusted data.

March was the 27th consecutive month with a year-over-year gain in Denver prices, according to Case-Shiller data.

Data taken from The Denver Businss Journal May 2014

The Denver Rental market is hot…..and getting hotter!

The market for rental property is hot and getting hotter here in Denver. Check out this article today in the Denver Post. We have one of the hottest zip codes in the country for returns on rental property. Give us a call today at 303-908-2330 or 303-907-1984  and we can show you how you can capitalize on this trend.

Hottest Real Estate Investment ZipCode in the Country
Hottest Real Estate Investment ZipCode in the Country

http://www.denverpost.com/business/ci_24570707/realtytrac-denver-has-one-nations-hipster-zip-codes

Denver Real Estate Stats for October 2013

Look likes the inventory decline continues for October Y/Y we are down 5-6%. Our Sold Market is up 13% from last year this month and the average sold price is up 9% too! Our Days on Market, however are way down in the 30% range. So the Market in comparison to recent years past is just a great place to be.

Kirby Slunaker, CEO and president of Metrolist, said that although the market has slowed somewhat, sales, inventory level and average home prices have changed “very little from prior months, keeping the market nearly as competitive as the hot summer months.

“While the market has slowed down slightly as one would expect, the numbers are incredible,” said Slunaker in a statement. “Increasing inventory spurred on by hot early season buying will continue to provide buyers with more and varied opportunities.”

The slight changes indicate that home prices and strong sales will occur throughout the fall and winter months, said Metrolist.

Metrolist added that average mortgage rates continue to remain low and steady, which will result in a “busy local real estate market well into 2014.”

Please call or text anytime 303-908-2330/303-907-1984 if we can help with any real estate information!

October Snapshot

 

To Buy or Not to Buy in the last Quarter of 2013

Have you been pondering the purchase of a new home? We are thinking that the positives for buying now are stacking up…Rates on fixed rate loans are still cheaper and on a downward trend again and folks in the know are saying it is still cheaper to Buy then Rent. The requirement for a down payment on a loan are lower than you might think and the qualifications requirements seem to be easing from the peeps that loan the moo-lah!

bigstock-man-hand-Finding-new-property-27034844

  1.    Rents are only going up from here. There are many pundits spouting about a 4% increase in rentals in 2014. Trulia Trends did a study in 2012 that said is it is 44% more expensive to rent in 100 major metropolitan areas so you do the math….
  2. Home Flippers have come to a halt. With our group of investors we have found that the flippers have flipped and want to hold on to their properties and use them as Rentals. Which makes sense since Rents are clearly on the rise.
  3. Loan Restrictions have eased.  Less stringent rules and qualifying criteria may help some people finally get that home Loan they have been waiting for. If you have good credit and some savings available for a down payment, you might just be able to get a loan for your dream home this year.
  4. Home Prices and Rates still at all time lows. Folks let’s just say while home prices are indeed rising they are still historically low in comparison to the highs in the early part of this century in most cities. Over the Summer interest rates did indeed rise, but they have been trending downward and relative to what interest rates could look like, we are still very low.

Wishing you all a very good day from The Walters Group