Living In Colorado Springs

Condo vs Townhome – Is There a Really Difference?

Rick Van Wieren — Thu, 04 Mar 2010 15:49:07 +0000

When I first studied for my real estate license, I always found the distinction between a condo and and town home to be confusing and a little hard to explain. In Colorado Springs, most condominiums for sale tend to be multi story, with units above other units, and so visually it was a little easier to determine the LIKELY description. Town homes tended to be ‘ground to sky’ single unit, and many people still distinguish the 2 by this physical attribute. This isn’t 100% correct however. The real distinction is in the legalese, and in today’s market, the financing.
1st, the legal descriptions of condominiums describe ownership in the unit itself, and a portion of the common areas. This can technically be done with any type of architecture (even detached units), and is ultimately the distinguishing mark of all condominiums. Town homes grant ownership to the unit, and the homeowners association actually owns the common areas. For most owners, the difference is not discernible, because they pay dues to the HOA to maintain common areas regardless.

The US Department of Housing and Urban Development (HUD) however, sees a big difference. They see the common ownership problem to be a big one when it comes to the current mortgage crisis. As more units have fallen into foreclosure, homeowners in the remaining units have been hit with big dues increases (since the defaulted units aren’t paying their share). This in turn leads to more defaults, liens, etc that make a mess. Their solution? Make it harder for people to use FHA financing to buy condominiums. The new rules don’t apply to town homes, and it is not impossible. However, the new rules have essentially caused many lenders to simply stop doing condominium financing. This in turn reduces the liquidity to existing condo owners, causing a new set of problems.

There are various criteria FHA is using to approve condo projects, including foreclosure rates, owner occupancy rates, proximity to traffic, financial statements, etc, that are all subject to change. You can view condominium projects that are on the ‘approved list’ here, however that doesn’t mean every lender you work with will do the loan, and it also doesn’t mean the complex will still be approved at the time your loan is processed. Fees can also be charged to the buyer to re-certify a project.

So does it really matter if a unit is a condo or townhouse? Yes it does! If you (or your future buyer) need FHA financing, a townhouse is a much safer bet right now. Could that change? Maybe, but in the world as we currently know it, it is already a disadvantage to buy a condo. Thankfully, in Colorado Springs, town homes for sale are much more plentiful, making the decision a little easier. Because town home architecture has normally been preferred, the legal descriptions have also been more frequently done that way, reducing the impact of the FHA financing changes.

February Home Sales Continue to Rise in Colorado Springs

Rick Van Wieren — Mon, 01 Mar 2010 15:44:52 +0000

Preliminary figures indicate homes sale rose again in Colorado Springs for the 7th consecutive month at a double digit pace of 13.5%. Prices were also up, though barely, with the average up .4%, and the median (1/2 above, 1/2 below), up only 2.7%. The inventory of unsold homes for sale dropped again, to 4,361 units or 12.7% below 2009 levels. The 90% percentile was a very soft $345,000, indicating that sales of higher end homes continues to be quite weak.
For more details, charts, links to the longer term history, please visit Market Conditions.

Cumbre Vista – Affordable New Homes in District 20

Rick Van Wieren — Wed, 24 Feb 2010 00:36:22 +0000

Today I stopped out to Keller Homes in Cumbre Vista to see their new model and discuss a current transaction I’m working with them, and thought I would share a little about this great neighborhood. Cumbre Vista is a unique development on the east side of Briargate, very near the new St Francis Medical Center (also known as Penrose Hospital north to some of us). It is unique, in that is a fairly low dues neighborhood ($20 / month for the regular single family homes), it is relatively small with only 2 builders in the neighborhood (Keller Homes and Classic Homes, both excellent local builders), and the prices for new homes still start under $300K (although most are more) Cumbre Vista (map) is also unique because it is on the southeastern edge of D20, and has great access to the Powers corridor for shopping and entertainment, while still offering great district 20 schools. The other unique feature of this neighborhood is that it is split between maintenance free patio homes (dues are $125/ month) and regular single family homes, so it is an attractive place for both young families as well as empty nesters.
Here are some of the homes available for sale currently in Cumbre Vista. In addtion to the attractive prices, some of these have nice incentives available as well. For RSS subscribers, you’ll need to visit the actual blog to see these, sorry!

Does Colorado Springs Have a ‘Shadow Inventory’ Problem?

Rick Van Wieren — Tue, 23 Feb 2010 19:54:04 +0000

A friend of mine at RE/MAX Properties posed this question to me yesterday, “does Colorado Springs have a ’shadow inventory’ problem?” and it really got me thinking. First of all, for those not familiar with this real estate industry term, ’shadow’ inventory refers to homes usually owned by banks, that are not being offered for sale yet, but probably will be before long. The existence of a ’shadow’ inventory of homes for sale is a hard one to prove, but I did a little snooping, and here is what I found.

There are 173 single family or patio homes for sale in Colorado Springs that are currently disclosed as Bank Owned of some sort or another, out of 4,352 active listings of homes for sale, or less than 4% of the Colorado Springs homes for sale. There are 181 out of 1450 Pending transactions, or 12.5% of the homes under contract. One theory is that these homes take so much longer to close, that they are disappearing from the market, but not showing up in the closed statistics.
In a preliminary spot check of homes owned by Wells Fargo, Bank of America, US Bank, and Household Finance (a random list), it appeared the only homes that were not showing up as for sale, were very freshly foreclosed upon, indicating that there is not a significant pool of ’shadow’ homes for sale.
In checking the number of actual foreclosure sales vs foreclosure filings, it would appear that the number of foreclosure homes on the market is fairly well balanced to the number actually being sold in foreclosure by the public trustee. Some foreclosures result in the bank taking ownership, but many are bought by investors. In addition, some foreclosures are not single family homes, and so are not material to the issue.

My conclusion? While we don’t seem to have a lot of foreclosures for sale in our inventory of homes for sale, they do not appear to be getting taken by the banks and held, therefore we probably don’t have a shadow inventory problem.

My own theory is that we have homes that may have begun the foreclosure process, but the banks are moving very slowly to actually complete it, granting homeowners more time to sell the homes (ie short sales), doing workouts, or simply delaying taking the property to sale (and therefore taking title), waiting for a better market. The fact that there were 207 withdrawals and 365 new filings (56.7%) would indicate that the banks are doing something to avoid owning all these homes.

For more information on foreclosure statistics in El Paso County, visit the El Paso County Trustee web site.

Woodmen Valley – A Secret Place

Rick Van Wieren — Fri, 19 Feb 2010 15:44:38 +0000

On the southern border of the Air Force Academy is a special neighborhood that we included in our luxury home tour yesterrday, called Woodmen Valley. The house was pretty special, and the 6 acres and horse facilities made it even more so. Woodmen Valley is unique because it is so close in, off the beaten path, and yet offers such a great lifestyle. Here is a link to the house we looked at: 8230 Westwood Rd. Here some other homes available in Woodmen Valley:

Colorado Springs City Budget Woes

Rick Van Wieren — Fri, 12 Feb 2010 16:15:57 +0000

Colorado Springs has a budget problem. Yawn. So does about every city, state and county in the country. The Federal government is about the only entity out there than can just print or borrow money when they are short. For those living in Colorado Springs, there are also some other issues however.

1. Every government entity in Colorado is required to have a balanced budget. That means the city can’t hit their Visa card to pay for services.

2. Taxes cannot be raised without a general referendum here. In fact, if tax collections rise as a result of, say higher auto sales, they can’t even keep the money without a vote. This law, called TABOR, has made it very difficult for cities to figure out how to maintain services.

3. Coloradans in general, and residents of El Paso County in particular (of which Colorado Springs is the bulk of) are pretty tax resistant. The recession hasn’t ignored us here, and with many either unemployed or underemployed, more taxes are not exactly on the morning breakfast menu when they wake up. Low taxes are in part why our cost of living is 7.7% below the national average.

At a national level, the debates rage over “guns vs butter”. To be more specific, defense spending vs health care spending in the current environment. At the local level, if revenue can’t be raised, it comes down to some pretty basic services, like trash cans and irrigation in the parks, street lighting, police and fire department staffing and response times, fixing pot holes, bus services, etc. In Colorado Springs, the city council is having to make some tough choices. Some of them may, at some point, cause noticeable drops in city services that we all have come to expect. The watering season for our parks really doesn’t start until May, so the decision not to run the sprinklers may not even be noticed until then. Who knows, with the weather being so weird nationwide, we might even get lucky and have a wet summer that makes this completely a mute point. There are even discussions underway to possibly sell the city owned Memorial Health System. They are auctioning off police helicopters, and even sold some buses to help continue funding the commuter bus service to Denver (called FREX for Front Range Express). CNN is supposedly working on a piece using Colorado Springs as an example of the municipal budget dilemma being faced around the country.

This week I had a homeowner tell me that they are going to try and organize their neighborhood to raise money for the watering and otherwise maintaining the neighborhood park in Old Farm. Old Farm Park is part of the network of parks connected by the Homestead Ridge Trail. It has awesome views, some nice play areas for the kids, and services an area of about 1200 homes. I was totally impressed by the level of commitment being expressed to not let this recession rob the quality of living in Colorado Springs in the Old Farm area. Perhaps this is just one park, but perhaps this will be duplicated in other areas, and just perhaps this sort of thinking will take hold across the country. Until this recession is over, maybe individuals and neighborhoods will chip in to do what government can’t afford to at the moment?

REMAX Properties Awards Breakfast Was Fun

Rick Van Wieren — Tue, 09 Feb 2010 20:02:30 +0000

This morning was our annual REMAX Properties awards breakfast. It was a cold one, 10 degrees when I left the house, and the streets were a little slick, but it was a good turnout. Joe Clement, broker owner for the #1 real estate company in Colorado Springs, always does a good job celebrating, and today was no exception. There was a little warm up music from Be Positive, a reggae group that will be playing tonight at the ‘after party’, and despite 2009 being a tough year in real estate in Colorado Springs, it was a very upbeat time.

I received several awards this year, including the RE/MAX International 100% Club award for my production in 2009, a 15 year recognition award, was ranked #13 in the company for production (among solo agents), and a Brokers Cup Award (for making Colorado Springs real estate sales statistics available to all of our agents first in the city every month, you can see these too, visit the Colorado Springs real estate Market Condtions tab on this site ) One of the reasons I’ve been with RE/MAX Properties for 15 years was captured in Joe’s closing remarks. He has a poster on his wall at our South office that says “First we will be best. Then we will be first.” His continued commitment to excellence and innovation make us as agents all proud to call RE/MAX Properties our real estate home.

Finding Colorado Springs Homes for Sale Gets Easier

Rick Van Wieren — Sun, 07 Feb 2010 00:39:17 +0000

New software is going to make it even easier to find homes for sale in Colorado Springs on our web site. We’ve added the Home Search option to our main menu at the top of the screen, making it easier to access without ever leaving our site. While we have a couple of options for searching for homes (those are still available), this menu item is based on the MLS Wizard from 1Park Place. It provides map based searching, even allows searching based on school district boundaries, and is a very fun way to browse our MLS. The search capabilities of this software are still not going to give the same filter capabilities as having us set up a “Client Web” site on our regular MLS system (please contact me at 888-568-6784 if that is what you need), but this will give a much more complete home search experience than we’ve ever had before.

Dry Cool Weather to Change

Rick Van Wieren — Sat, 06 Feb 2010 16:41:26 +0000

We’ve had a pretty normal winter in some ways. Other than a cold start to the month, it has been pretty much in the 40’s, and very little snow, and lots of sunshine. We are finally due for another snow event on Sunday – Monday (maybe just in time for the Super Bowl?), so I’ve have to get my hiking in today. Yesterday I was able to get up to Palmer Park over the noon hour, it was pretty gorgeous, as usual. The Mesa Trail is really pretty flat, and runs around the edge of the plateau, making for a really scenic little hike. It is an ‘off leash’ area for dogs, and takes a little getting used to how many people walk their dogs up there (or maybe it’s how many dogs people have?), but the 360 degree views are stunning, and it is good exercise.

I say pretty normal, the central mountains where most of my favorite ski resorts are located, have been hurting for some fresh powder. They’ve gotten a little again this week, but by this time of year, the base should be in the 50 inch range, and while some resorts have it, many do not.

This week was a little busy. I showed quite a few houses in the $350 – $450k price range. The selection is pretty good in this range, though I was surprised there weren’t more builder ’spec homes’ available. Several had sold just recently, so this segment may be picking up a bit. Generally, homes for sale in Colorado Springs in this price range are going to have some pretty nice amenities, such as granite countertops, nice lots in good areas, and will range from 3000 to 4,500 square feet. Most of the homes we looked at were in the Monument and northern Colorado Springs areas (Briargate, Northgate), as the client was most interested in D38 and D20 schools, and larger lot sizes.

January Home Sales Up Again in Colorado Springs

Rick Van Wieren — Mon, 01 Feb 2010 18:33:43 +0000

Single family home sales were up in January by 12.3% over a year ago at 464 units (preliminary data). Prices were also up, with the mean up 6.2% ($211,008) and the median (1/2 above, 1/2 below $178,250) up 3.0%. January of 2009, in fairness, was a terrible month. This January and last January, were in fact, the 2 worst months of home sales since 1998 in Colorado Springs. Still, year to year comparisons are sometimes good, to remember that we do have seasons to our market, and January is always the worst month of the year. It only gets better from here!

Please see Market Conditions for additional details.