Denver Colorado Real Estate | December 2009 Market Statistics
January 7th, 2010 categories: Market Trends, Selling Strategies
December. The end of the year. The end of the line?
Not really. December was another interesting month in Denver Real Estate. Inventory was naturally down, as it typically is this time of year. We’re down to 16,456 active listings. That’s the lowest number of homes on the market since before 2006 when the available MLS records stop. Meaning buyers have less to choose from than in the past 5 years.
The highest number of listings was in July of 2006 with 31,989 homes on the market. We’re almost 50% off that number.
I remember one day back in 2006 pulling up listings in Highlands Ranch to show to buyers I was working with. I had a match of over 500 homes for their criteria. It was a chore to eliminate properties to get a rational number to view. First everything with an unfinished basement was tossed. Then the small yards, then homes that were near busy streets.
Only the creme de la creme made it to a showing.
This month, we’re struggling to find properties to show to buyers. There are some great homes still on the market, but many are stale for a variety of reasons. Some have location issues, many are still over priced, some aren’t finished as nicely as their competition.
Sellers have an opportunity. Right now! They need to get their house in top showing condition and get it on the market.
Average sold price is up: 7.13% since November and 13.59% since this time last year. This number has been driven up by the sales in the lower price points. High end homes are still lagging.
Sellers - now is your time. Buyers want to take advantage of the home buyer tax credits. They have pent up demand. They don’t want to miss out on low rates. Get your house ready and get it on the market.
Buyers who were worried that the tax creidt was expiring in November hurried up their closings, and November sales were way up. December closings were down, but with the tax credit extended, the holidays over and rates still low - sales will undoubtedly begin to increase this month. The contracts written in January will close in February and March, so watch for closed properties to increase in those months.
The state of the economy is still in debate, but what is the average Joe doing? Joe the Plumber? Joe the Snowboarder? They’re starting to think this might be a good time to move.
Check out all the Denver area listings on my website; www.GretchensDenver.com and let me know when you want to buy a new house!
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5 Steps to Selling Your House in a Crazy Up and Down Market
August 30th, 2009 categories: Selling Strategies
You have your house on the market and you say you want to sell it. Do you really?
I find that there are a lot of homes for sale that aren’t really, “on the market.”
What do I mean by that? Ask yourself, “how many showings have I had this month?” “Am I reacting to the feedback I’m getting?” “Am I even getting feedback?”
Are you taking a defensive posture with your broker? Are you thinking of moving on to your second, or even third broker? Chances are, it’s not your broker - it’s denial. We all have moments of denial, maybe I should call it exuberant optimism, in case you feel insulted that I say the “d” word about you and your beautiful house. But there comes a time to wake up and smell the coffee and make the tough decisions.
Step 1 - Decide if you’re committed to listening to the feedback. The feedback from the brokers showing your home and from your own broker. I typically use 30 days and/or 30 showings as a benchmark. If you don’t have an offer after that many bona fide buyers have walked through the house something needs to change. If 30 days have gone by and your house isn’t being shown, then something needs to change. Of course, there are instances when there just aren’t any buyers in the market your house falls into, and then perhaps making changes won’t result in much. However, too many sellers think that’s the case for them, and they agree to make only slight changes. The slight change doesn’t introduce the house to a new market, but it gives the seller a change to say to his broker, “see, I told you there just weren’t buyers out there.” or “You aren’t marketing the house enough, and that’s why there aren’t buyers.” A $3,000 price change is nothing. As, Larry Kendall, the guru of real estate says, “Remember, no amount of marketing will overcome poor pricing.”
Step 2 - Ask your broker for an absorption rate positioning study. Most brokers know how to calculate the absorption rate for their cities and neighborhoods. Have you seen that from yours? It’s an analysis that will give you a very good idea how many months of supply you have in your market. Currently in Denver, we have about 5 months supply in the lower price ranges. This is a good number and indicates market stability. Conventional wisdom says anything over 6-7 months show signs of a weak market. In our high end market we have about 7 years supply. That is most definitely a weak segment of the market. It’s not enough to know the absorption rate. You want to know how you are positioned against the competition. Take the sales rate (absorption rate) and divide by the number of properties currently on the market (including yours.) This will give you your odds of selling this month. If your odds are low, then you need to work hard to rise to the top of the heap. Lower the price so you look the most competitive, consider remodeling, staging, planting flowers, painting. Anything you can do to come out in the top houses.
Step 3 - Calculate your “walking away money.” Sellers are fond of telling us they, “need this amount of money out of my house.” They say they need it for their next house, to pay off debt, or so they don’t have to bring money to the table. Some sellers become shortsighted and reject an offer or don’t negotiate hard enough because of this perceived bottom line. The thing they forget to figure into the calculation is carrying costs. In some cases, houses are selling fast and they might be confident that they will get another buyer right away. But if it took you months to get the first offer, it might take months to get another. And usually the second offer is worse than the first one was. Remember to figure in your monthly carrying costs along with your loan and expenses to get to your “walking away money.” This might make that offer seem a little more appealing.
Step 4 - Keep your house clean. That seems pretty obvious, right? I guess it’s not, or some people have very different ideas of what clean is. I walked into a house today with the worst cat odor in the basement you can imagine. Putrid was my thought. My buyer covered her nose and ran back upstairs. If you live in an area that has a Pottery Barn or a Crate & Barrel, just go walk through those stores for an hour. I’m not suggesting that your decorating style has to be the ubiquitous Pottery Barn style. I am suggesting that while your house is on the market it needs to become a model home. Sometimes uncomfortably so. Hopefully, it’s only for a short while, but think about it as not your house anymore.
Step 5 - Have a crucial conversation with your Broker. The stakes are high and you want to sell your house. Agree to become a partnership. If your broker is exposing the house, and if you’re getting feedback that something needs to change, then you need to do your part. The two of you should lay out a calendar. In this calendar put your broker’s responsibilities in one color - the dates of ads, when it’s posted online, dates of open houses, etc. In another color, put your own responsibilities. This is a two way street, Mr. Seller, it’s not all on your broker’s shoulders. Your responsibility is to react to the feedback without getting emotional or defensive. Don’t say, “they don’t know what they’re talking about, it would only take a few thousand dollars to finish the basement and they could do it the way they want it.” If buyers are passing your house by for finished basements then you have two choices - reduce the price or finish the basement. You choose, but do something. Defensiveness and sneering at “stupid feedback” will not sell your house.
Houses are selling, in all price points. The houses that sell the fastest have the most motivated sellers. Get your house at the front of the line - be proactive not reactive.
Thanks to Larry Kendall, of The Group in Fort Collins, for sharing his wisdom about absorption rate positioning and calculating walking away money.
Want to search for Denver Homes for Sale? Click the link at the top of my page and enter into the best site in Denver for an immediate home search. You can search by neighborhood, by map area or by price!
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You Can’t Market Your Way Out of This
May 15th, 2009 categories: Market Trends, Selling Strategies
We’re at a crossroads.
Denver real estate agents acknowledge our job requires that we spend personal dollars on marketing our listings, that’s a part of the package. We pay ourselves back after a transaction closes. There is no company behind us sponsoring the ads we run, the postcards we mail, the internet sites we buy.
In a real estate market like we have today, many sellers think (hope?) that we can market ourselves to a sale, we can’t. Buyers are few and savvy.
Exposure is happening. Your real estate broker is advertising and marketing more than ever in the history of brokerage. Properties today are more exposed to a broader market than they’ve ever been in the past. We post them all over the internet, we blog about them, we tweet them, we post them on Facebook, we buy old fashioned print advertising (particularly magazines with a longer shelf life,) we send out email blasts to other brokers, we hold open houses and Broker open houses, and we spread word of mouth like crazy to any broker we think might be lucky enough to be working with buyers.
Still, our clients call us and ask, what more can you be doing? Phone calls like these add to our sleepless nights. What more can we do? We stare at the ceiling at night and pray that this one gets an offer before the seller pulls it and lists it with another broker. To a broker selling hope, but not necessarily selling houses.
The worst indignity is when a seller pulls the listing, lists with another broker and then reduces the price to where you knew it should be all along. Now the second broker has the benefit of all the months you’ve exposed the home, all of the marketing you’ve paid for, plus a price that you weren’t allowed to list it for.
Phew! We tell ourselves to move on, it’s a part of the job, it’s the nature of the business.
It still stinks because you can’t market yourself out of the problem, but you can price yourself out of the problem.
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A Tale of Two Markets - Denver Real Estate’s Opposite Ends of the Spectrum
May 3rd, 2009 categories: Market Trends, Real Estate News, Relocation Tips, Selling Strategies
I was a busy Realtor today. Showing houses in the morning, an open house in the afternoon. Typical Sunday.
Morning Glory
It was an interesting dichotomy. My morning clients are an adorable couple with their baby looking for their first home together. They can spend around $160,000 for a single family house. That’s a tough price range in Denver Metro Real Estate. The houses that fit their criteria are either trashed foreclosures or they already have multiple offers. The best house today had three offers pending bank approval when I called to tell the broker we had some interest.
In the lower price range, we’ll need to be ready to move fast when we find that perfect house. Buyers must be pre-approved, should think hard before they ask a seller for concessions, and shouldn’t expect sellers to accept an offer contingent on the sale of another property.
Afternoon Delight
This afternoon, I held my Park Hill listing open. This is a new home built in 2007 and is priced at $1,749,000. The house is absolutely gorgeous, but this price range is struggling in Denver. We’ve marketed the house like crazy, held it open many weeks in a row, even reduced the price a couple of times. Sellers in this price range must understand that the only real weapons we have are price reductions until the house sells or time. Time may take longer than most sellers would like. Thankfully, these sellers are very supportive and patient and they understand the market. Many Realtors I know are receiving tremendous pressure from their clients, and it’s a big burden when you have little control over market dynamics.
I firmly believe that our burgeoning lower end real estate market will soon be trickling up into higher and higher price points. Jumbo mortgage rates are more affordable and comparable with conventional loans. Pent-up demand is seen in the numbers of people going through open houses every weekend - even with the Nuggets in the playoffs this afternoon!
Buyers - Prepare by contacting your lender first. Get a pre-approval, keep on top of new inventory through a real estate broker, and don’t assume you can lowball anymore.
Sellers - Respond to what else is selling in your neighborhood. If similar houses are selling at 10-20% less than yours is listed for, then you are overpriced. Appraisals are tough right now, you need to be able to see what the market is telling you about the value of your house. Give it time, there’s an ass for every saddle - someone will love your house - listen to the wise counsel of your broker and the buyers’ feedback and in time you’ll have your name off that title.
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Top 3 Reasons to Understand Real Estate Agency Rules in Colorado
April 19th, 2009 categories: Relocation Tips, Selling Strategies
You’re thinking about buying Denver Real Estate and you’re ready to hire a broker to represent you. What you need to know is that we have very specific rules here in Colorado about disclosing and explaining the rules of Agency to our clients and customers.
There are 3 very important reasons to understand the Colorado Agency Rules before you get started:
1. Is Your Broker a Coach? I like to explain to people that an Agent (a Buyer Agent or a Listing Broker) is like a coach. We have a fiduciary obligation to represent your best interests, negotiate on your behalf, uncover issues with the property that are discoverable and disclose any pertinent information we might have or learn. Your coach puts you in the game, advises you how to play and roots for you all the way.
2. Is Your Broker a Referee? If your agent is working for you as a Transaction Broker (sometimes called a TB) then you can think of her as the Ref. The referee runs up and down the field and makes sure the game is played fairly. A TB will owe you the duty of honest and fair dealings, but will not be able to advise you or represent your interests. It’s required that a broker who is working with both the buyer and seller either be a TB or keep the Agency relationship with one client and treat the other as a “customer” - someone he has no brokerage relationship with at all. It’s not inherently bad to have your broker be a TB, but always ask in what capacity is your agent working with you.
3. Do You Have Anyone in Your Corner? If your broker is representing the other party as an Agent and treating you as a customer, you might want to rethink that relationship and get some help and advice. I’m always amazed at the people who will walk into an open house, say they want to make an offer, but also say they want to do it on their own to, “save the co-op commission.” People, really! This is probably the most complex and expensive purchase of your life! Get someone who understands the ins and outs of real estate to help you. If you like the broker at the open house, ask her if she can be a TB (her sellers would have to agree.) You can also ask her to make a referral for an outstanding Buyer’s Agent. You might even want to engage the services of a crack real estate attorney. We aren’t required to use attorneys in Colorado transactions, but someone should be in your corner.
For more information on Colorado Agency Rules, you can visit the Colorado Real Estate Commission site. And one more thing - these disclosures are supposed to be made in writing! Ask your broker for the Definitions of Agency if you’d like a more thorough description.
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Reduce the Price of Your House When Rates are Falling?
March 25th, 2009 categories: Market Trends, Selling Strategies
We’re in a recession. The worst since the 1930’s.
Have you heard that yet? So have I, but guess what - we’re still selling homes in Denver!
I’ve said it before, Denver is weathering the storm better than many other areas. It’s not only me and other exuberant Realtors pushing an agenda - read it in the NY Times and see it on NBC - Denver’s stability is news.
Still, our higher priced homes are taking longer to sell and have fewer showings while they’re on the market than the mid-priced homes. Medium priced homes that are overpriced relative to their competition are stalled too. It’s a buyers market!
A seller recently asked, “rates have come down more, why should I drop the price of my house now?” Uh, well Mr. Seller, because if you can’t get showings now, when Mr. Buyer’s purchase power just went up again - you’re overpriced!
I really wish it weren’t so. I wish your home and mine were still appreciating at 10% a year. I wish that you could get “what you need” or “what you paid for it” or “what your neighbors got 18 months ago.” I would love to skip the part of the listing presentation where I tell you your house is worth $400,000 less than you want me to list it for. I have some wonderful listings that we priced 18 months ago that could have benefited from my crystal ball (it’s been on the fritz lately). I might have suggested back then that we not be quite so aggressive.
I’m suggesting it now. Two weeks ago I essentially walked away from listing a house that I’ve always loved when I drove by. I had to suck it up and deliver the news to the sellers what today’s value is. I knew that would be the kiss of death, that they would pick the broker who told them what they wanted to hear. It’s listed now for $250,000 more than it should be.
Strike while the iron is hot. Drop the price until you get showings. After 25-30 showings, drop it again if you don’t have an offer.
I’ve closed 4 sales in the past 40 days - all high priced homes relative to the average in Denver. What got them sold was that they were aggressively priced relative to their competition. As rates go down and buying power goes up, use that to your advantage to gauge where the market rates your house a value. Get your price there and you will sell it.
Surf Denver Real Estate at www.GretchensDenver.com!
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Knowing When It’s Time to Buy a Move Up House
February 24th, 2009 categories: Selling Strategies
In today’s real estate market, there is a very compelling argument that it’s a good time to buy a move up property.
You say, “I can’t sell now, I’ve lost money on my house.” Assuming you’re not upside down and owe more than the house is worth, you may not be losing as much as you think.
Say you’ve lost 20% in value - as shown in the first slide - your “loss” compared with the loss the larger property incurs wouldn’t be as high. The percentage decline is a function of the value of each of the homes. If your loss is $90,000 and theirs is $130,000, then when you net this out you could say that you’ve gained $40,000 by trading up.
You’ve now moved into your beautiful, and larger home. Stay there awhile. You’ll need to hang tight for several years, but eventually inflation will take hold and the price of the home will begin to rise.
You decide to sell at some future point. The gain is 20% in value since you purchased the house. If you had stayed in your smaller home, your 20% gain over that time would amount to $72,000. The gain you’ll recognize on the larger house would be $104,000! Can you see why it’s a great time to move up when the market is depressed?
Rarely is there such a dramatic convergence of low prices and low rates. It can’t last forever. You should speak to a reputable mortgage lender and see if you’re a good candidate for a move up now. Check out Denver Real Estate at my web site, www.GretchensDenver.com, with nearly every listed property in the Denver Market available to see.
Thanks to Steve Harney and Keeping Current Matters for the terrific slides.
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Denver Real Estate | Denver’s Architectural Styles
January 3rd, 2009 categories: Life In Denver, Relocation Tips, Selling Strategies
When you’re selling your home in Denver, you may want to have the correct label on the house for it’s architectural style. I’ve seen homes that were clearly Victorian labeled Tudor, or Mid-Century Modern called International Style. Denver Real Estate is replete with fabulous architectural styles, and remember, marketing is everything. Your Bungalow may or may not be Arts and Crafts.
My home is a Tudor style, something my husband and I said we didn’t want when we were looking for a home. We tended to gravitate to clean lines and a more modern, warm feel. Our house was built in 1938, and many of the architectural details reminded me of the house I grew up in, built the same year. While we thought a Tudor home would be dark and choppy, we discovered that the house was perfect for our family’s lifestyle.
Another lovely style that’s been adopted as a Denver original is the Foursquare. Locals call this a “Denver Square” and these homes were primarily built in the late 1800’s and early 1900’s. They supplanted the more embellished Victorians found in many of our older neighborhoods.
Always a favorite of mine is the Modern Style home. Among “Modern” you’ll find Prairie and Usonian styles, and in some 
neighborhoods (Bonnie Brae for example) there are fine examples of International style homes. These tend to be devoid of decoration with clean lines and flat roofs. As a child, our coffee table books were Art or Architecture books. I clearly remember thumbing through my parent’s Bauhaus book and being enthralled with the artistry of the style.
Other typical Denver styles of architecture are Neoclassical and Georgian. These are often confused. The Georgians are very symmetrical and formal. They usually have a grand entryway or portico. The keystones above the windows are another giveaway that you’re looking at a Georgian style home. The Neoclassical style shows off the very prominent columns and you can’t mistake the look that was intended to mimic a Greek Temple.
Finally, we must admire the workhorse of Denver’s Washington Park neighborhood - The Bungalow. Bungalows in Denver are low slung and brick. They typically have lovely front porches with brick columns holding up the roof. Many bungalows have beautiful Craftsman style mill work inside, and it’s always a pleasure to find the warm wooden trim unpainted or restored.
Central Denver is a unique mix of architectural styles, and while some have been adapted with a western flair, there are elements of historic styles in new and older neighborhoods. Read today’s terrific article in the Rocky Mountain News if you’re interested in more information on Denver’s architecture.
Enjoy your search for a new home in Denver, Colorado!
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Denver Colorado Real Estate | Top 5 Ways to Move Your Listing to First Place
October 25th, 2008 categories: Market Trends, Selling Strategies
Many home sellers are finding themselves heading into the Fall and Winter months with their house still on the market. “Why?” They ask, “My home is wonderful and I love it, why doesn’t someone else? Why are we missing the bullseye?”
Denver real estate is very segmented right now with some segments selling much better than others.
Many home sellers are on their second or even third listing agent and have reduced their price along the way. They’re wondering where they go from here. Even wondering if they should remove their house from the market through the winter.
Market trends dictate that sellers need to be calculating in how they approach the sale of their house. Here are my top 5 suggestions for sellers to keep in mind:
1) Get a New Market Analysis - when real estate prices are trending down you’re in a very different position than when prices are flat. If you get a new market analysis every 5-8 weeks, you can discern what’s been happening with actual sales in your area. If you see prices continuing to deflate then you need to get in front of that rock that’s rolling downhill. Price reductions putting you just behind the rock won’t help you move into first place for buyers.
If the prices seem to be remaining flat, then you can adjust your price to that place and then leave it there. Pay attention to other factors that will move you into first place and keep getting a new market study every month or two. Remember, prices of homes currently available on the market don’t count when comparing prices.
Avoid “pricing entitlement” - a friend just coined that term and it fits. Sellers need to realize that their house is a commodity that goes up and down (more up than down for sure). If you’re willing to look at stocks as an investment and recognize that sometimes you sell up and sometimes you sell down, why is it so difficult to recognize that this can happen to a real estate investment too? You aren’t entitled to a price, the market will tell you what the house is worth. You can choose to sell or to hold on for a price upswing, but you can’t change market perception.
2) Consider Staging - if you’re living in your house while it’s on the market, you’d be amazed what a staging specialist can do with your own belongings to make the house pop. A fresh eye on furniture placement, some added decorative items and massive de-cluttering can completely transform a property.
If your house is vacant, you should investigate professional staging. The addition of classy furniture adds warmth and pizzaz to an empty house. Staging can add up if you’re paying a monthly fee, but there are ways to economize - like staging main rooms and leaving secondary rooms unstaged.
3) Re-Frame From the Curb - are you missing showings that were scheduled, but they skipped coming in? Then you may have to act like a movie director and look at your house from the street to see what’s going on. Be critical - act like you’re a buyer and this isn’t your house yet. What do you see? If there is chipped or peeling paint, if the front door is dirty, if the grass or shrubs are dead (or they block the front) you’ll need to give some attention to the maintenance of the exterior of your house.
Washing the windows will add sparkle that isn’t overt, but still makes a difference. Buyers like to look out through clean and clear windows. Dirty windows add a dingy feeling to an otherwise nice property. You can hire a window washer, or buy one of the spray products that screw onto a hose.
4) Paint the interior - I like colorful walls, and have several rooms in my house painted in color. That probably isn’t the best way to show a house. Neutral (with a little spark so it’s not boring) is much better. If you already have fairly neutral walls, but they haven’t been painted in over two years, then re-paint again. Fresh paint makes a world of difference in a buyer’s attitude about a house. If you have white walls, that’s just as bad as having too much color. White is harsh and cold - it doesn’t add a feeling of warmth to a house.
5) Have Your House Ready - too many sellers get preparedness fatigue after a few months on the market. They’re sick of living in a show home, tired of picking up and harassing the kids, and want to leave the bed unmade for just one day. Discipline yourself - don’t fall into this trap! I can’t tell you how many times I’ve walked into cluttered and unprepared homes with buyers lately. It amazes me that sellers would let their guard down when there is so much competition. Can some buyers look past this and see the house for what it is? Sure, a few can. Is that a risk you want to take?
Keep things in perspective, keep a positive attitude and remember that there’s an ass for every saddle! Your saddle just needs to be in first place on a buyer’s list.
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3 Open House Requirements
September 22nd, 2008 categories: Real Estate News, Selling Strategies
It’s time to hold an open house and your real estate broker has scheduled the date and time. You may not realize that there are a few essential preparations you need to be making prior to that day.
1) Clean as if your life depended on it. My sister and her husband called me recently as they left an open house. They’d admired this home for a few years, and when it was finally held open, they were excited to see the inside of the house. This is a $2.4 million home in Denver. They entered the house and the carpet was filthy, there were stains throughout the house on all of the floors. The ceilings, light fixtures and ceiling fans were covered in cobwebs. Needless to day, they left diasppointed. The sellers should have spent the day before cleaning and getting ready for their chance to shine. Instead they fell flat.
2) Remove personal items. There are people who will visit an open house just to obtain private information, jewelry or prescription medications. Hide or remove valuables and medications. Security lock your computer and keep bills and personal mail out if sight. A few years ago, a client had recently endured knee surgery. During our open house the pain medication he’d been prescribed was stolen. The open house was very busy that day, and I had no way to keep my eye on everyone so the pain pills walked out the door with someone.
3) Think of the 5 senses. Buyers like a house that is light and bright and has plenty of fresh cut flowers, smells like vanilla or cookies, has soothing soft music and feels like home with an abundance of textures in fabrics and finishes. You can even appeal to visitors’ taste buds by offering them some cookies or chocolate.
Keep your house ready for showings at any moment. It’s more likely that buyers will see your home with another real estate broker who has set up an appointment rather than at the open house. But you never know, so help your broker who’s taking Sunday afternoon to hold an open house and make your home shine.
To view Denver Real Estate, relocation information and Denver maps visit GretchensDenver.com.
Visit the Park Hill home tour Sunday, September 28th and stop by our open house at Montview and Grape.
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