Benny Moo

Social Media Backfire: Twitter learns Gravity Lesson

One of the fun things I've messed around with this summer is Twitter. Permission based, you can follow people or organizations, and people and organizations can follow you. Sign up to follow Barack Obama and his minions return the favor within 6 hours. Sign up to follow John McCain, and you're not sure which Daily Show wannabe with a potty-mouth you're actually tracking.

The pluses: you can communicate with people really simply. My blog published to it via twitterfeed, there are Blackberry apps, you can text, direct text and really work a system where your world truly is online. But since it is permission based, you can let in who you want in and keep out who you want out.

 

Well today, reality checked in on Twitter's party. I had 31 people that were following me yesterday. This morning, 24 of them had disappeared. I was following 45. 28 of them were now gone.

It takes work to build a network. It takes creativity to run your business in new directions. It takes emotional elasticity to not take this as "some sign" (a reason a newbie agent won't sit my open house this weekend... seriously) that things won't work, and go back to being an arm-twisting, agenda-driven salesperson rather than an open-book communicator.

No, emotional elasticity says: DO treat it as a sign. It was a lot of fun looking for Wil-E-Coyote images and his many foibles. See, that poor sucker had it really hard.

When Ben doesn't Blog: The Elastic Methods of 2008

Always a good start when there is a self-referencing third-person beginning, right?

Today's post is a long Tweet, a diary of what working in this market really is like. I haven't posted at all this week because I've been bent and twisted in every conceivable direction. It's all from this week.

• I have delivered four pre-listing packages this week
• Delivered one listing presentation face to face
• I'm heading out for a second in 5 minutes
• I delivered another over the phone and via email yesterday
• I was supposed to do a client dinner Sunday night but 2 year old coughs, snot and boogers got in the way.
• Those boogers and coughs stayed in the way Monday night when two sons devoured barbecue and the littlest crashed out asleep on the couch at 6:15 as I juggled Daddy duties with Mom out for a night.
• I previewed a 22 acre ranch that would make an ideal organic restaurant. Problem: it's in Fountain. Benefit: it's in Fountain (they have a 120 growing season 600 feet lower compared to the 90 days at my house in Pinecliff).
• I found out a good friend's father likely has terminal cancer in Sweden. They may move back.
• I met a just-tenured CC prof for the first time and showed him both my listings.
• I had 1109 N. Institute fall when a buyer got weirded out about home-ownership at $300,000 (do more or less offers fall when a buyer offers full-price?)
• I attended a company strategic planning meeting. Yeah, no stress there.
• I just received an ILC on my listing downtown showing a 4 foot encroachment of the garage into the city's alley. "And there was much rejoicing. Yeah." This after a 3rd showing last night, and they're writing an offer if the ILC shows a good property line. Which... it... doesn't. Hey, at least three of the four sides of the garage are within the lot lines, right? Does a 75 year history of trespass count for anything anymore?
• I was fire-hosed by my 5 year old last night as I stepped out my car on a 95 degree evening and the formerly booger-and-snot Jer-Jer laughed hysterically at Dapper Daddy dripping wet from Andrew's garden-hose-assault.

We live in an increasingly customized society. The reality is I'm so terribly grateful for the people I meet who expand my ability to adjust to new people, old people, phone people, email people and little 5-year-old people hiding in the bushes with garden hoses. I'm grateful for the books I read which stretch my imagination to think about how a 1924 farm house backing to Blossomfield could be converted to a world-class destination restaurant with an outdoor cigar bar. I'm grateful for the places I've visited this year (Rocky Mountain Nat'l Park's Fall River on Saturday high on the list) that put high-value petrol in my personal tank so I have something left to give to the world I live in: a world that is in constant change.

Free Friday: Grilled Pineapple Salsa

Kevin Day really gets credit for this, because he's the source file. But as he well knows, there is a very difficult ability to enforce intellectual property on recipes.

I'm fishing tomorrow and Rocky Mountain National Park prefers all anglers harvest Brook Trout, an invasive species on the territory of the gorgeous, wild, native Greenback Cutthroat. 

If Andrew and I get any brookies for the creel (I'm using my Cedar Heights Man Purse from the Nichols & Comito Home as a creel... maybe that entertains only me!), this is slathered all over them after they come off the grill.

1 Pineapple, skinned, cored and cut into four large pieces
1 red onion, cut horizontally into about five sets of rings
1 red bell pepper
1 orange bell pepper
8 sprigs mint
3 T Lime juice
2 T New Mexico Chipotle Powder
Optional: 1 Jalapeno (grill whole)
Optional: 1 Chipotle in Adobo

Warm your grill to hot (1 second hand test four inches above grill)
Scatter all the fresh fruit and veggies across the grill until charred
When cooked, remove and dice and place in a bowl
Toss with Lime Juice and Heat of Choice
Add a turn or two of feshly ground Kosher Salt or Sea Salt

Top Five Market Realities

I haven't done a list in awhile, so I'm overdue. Hopefully this is humorous as well as informative about Market Realities.

Number 5: If you leave your pet bulldog in your $400,000 house when you know a buyer is coming, and that buyer had the courtesy to schedule the showing 24 hours prior... you are probably are not selling the house to that buyer.

Number 5A: If said bulldog has a sinus infection and likes to lick women's legs, "probable" descends to "not at all".

Number 4: New construction DOES NOT always appraise. Case in point: my sale in Gold Hill Mesa came in $17,000 low on appraisal today. Since it was a VA appraisal and since the rate of sale there is about 2 units per month, the builder has no other option but to honor the existing appraisal. So the idea that a build-to-suit isn't such a great buy in this market is still determined by the declining market appraisal values we are increasingly seeing. Happy Buyers by the way.

Number 3: There are 5000 pieces of junk for sale right now and 1600 pretty nice, well-priced homes. With a supply of about 800 buyers per month, these buyers will do their due diligence before they look, before they pay for an inspector, before they pay for an appraisal and before they write a contract. The standard to be a pretty nice, well-priced home is pretty slim and there is no second place...you are either pretty nice or a piece of junk.

Number 2: If you're waiting on the fence as a buyer for a really good home to come to market because it feels like there are so many houses for sale and surely another one will list tomorrow... think again. The supply side feed to the market place has been off by 20% this spring from the previous year and is approaching the supply pace of 2003 and 2004. There are probably hundreds of sellers who are simply refusing to put their homes on the market right now because they can't be o don't want to be pretty-nice-and-well-priced. Instead, they will sit tight or rent. Most of the homes being purchased right now are either brand new on market or have eroded price substantially to the point that buyers swoop in and gobble them up as a great buy (se builder's decision on appraisal above... better to close on a low appraisal than sit!). Which brings us to:

Number 1: The rental market has gone gonzo this past week. Clients who chose to rent lost out on 7 properties in the last two weeks from $1500 to $2200 a month in rent. That's called blistering hot. With many of these homes tied up in one year or longer leases, the scale back of properties re-supplying the market when it does turn, and sellers decide they do want to sell (see Number 2) will be phased.

Potential in Patty Jewett: 1322 N. El Paso St.

Rarely do properties with real potential come on the market in the most desirable of neighborhoods.

Even rarer is when those properties are as neat and tidy and ready-to-go as this one:

1322 N El Paso, Colorado Springs, CO
This 1898 Farm House is filled with original fittings and charm with the elegance of a bygone era. There are some necessary upgrades to realize full potential with this home, but many of the major mechanical, structural and non-cosmetic requirements are already complete, making this a home with abundant opportunity for a buyer with real creative vision.

Historical elegance includes:
Wide-Plank Fir floors. In need of refinishing, they are all exposed and evident throughout the home.
Six Inch Trim and original crown moldings.
Copper Door Hinges on every door
Nine Foot ceilings with lathe and plaster walls.
A high-ceiling entry with original staircase and bannisters showing Victoria-period woodwork
Covered Front Porch with Swing
Dutch Gambol-style architecture with hipped roof and window "eyebrows" to neatly deflect rainwater
Clawfoot Tub
Butler's Pantry
Original Fireplace (capable of gas coversion)

In addition, the home features functional attributes that are hard to find downtown:
Spacious Room sizes
Dining Room with Bay Window and Fireplace
Bathrooms on the main and upper levels
Gas Stove and dishwasher in the kitchen
Large Kitchen Pantry
Main level laundry hook ups
Two-Car Garage "sized" shed that could be converted to a two or three car garage on the back alley
Beautifully maintained landscaping
90% Efficient Furnace
2003-installed Roof
Storm Windows
Rock Foundation Tuck-pointed in June, 2008

The exceptional value of this home is the original character and charm unmolested by low-quality renovations. With the original vision of this home still present, and all of the high-value original features exposed and ready for showcasing, this is an opportunity of high order ready to reward the creative buyer.

Price Wars: Utopia

Brad Inman did it again.

I have a lot of regard for Brad as a journalist and inquisitive individual. I often don't agree with his sentiments, especially in regards to limited service versus full service (Glen Kelmann and his Redfin boys and girls are smart and they have a good business model but they are not consumer-messiahs as Brad tends to treat them). Yet his posts and my posts have tracked very similarly this last week culminating in TODAY'S POST.

If you read this and your a REALTOR, you might quibble. But if you're a consumer (who the REALTOR serves afterall and should really be working for the benefit of), you probably read this with full-force agreement.

I was speaking with my friend Morgan Saturday night and between us, we know 6 people who actually own their home. Since I work in the business of selling and buying homes, you might think that after 300 transactions, that number might be a little higher. It isn't. I have had five cash buyers in nine years of practicing real estate. All the other transactions were financed with loans. I have never had a listing receive a cash offer. Ever. Maybe some of them got paid off later. But when they bought, they always bought with someone else's money.
Morgan asked exactly the same question Saturday night Brad Inman asks today: if a bank has a loan on our house, who really owns the house? Well the Greek tells us that one is the Mortgage. The other is the Mortgagee. One has something to put to death (mort coming from the same root as mortuary, mortician, etc., meaning "to put to death"). The other has to do the business of putting it to death. Who is putting who to death when 100% loans are concerned is less a question and more a reality. There isn't much philosophy or perspective can do to change that appearance. It is fact.

What's this whole mess built on?

Now, let's go to the contract I wrote today:
Past clients.
Own a home downtown.
Have assets (as in savings, stocks, bonds, securities, those things that create wealth).
Keeping the original home as a rental property.

I handed her my "Give your Child a Chance Flyer: and asked her four questions:
Do you own your own home? (I sold it to her 5 years ago)
Has it been a good investment? (it has increased in value 45%)
What if it was free and clear?
What if you owned ten of them?

All of a sudden, you own ten, free-and-clear houses, and the game is very, very different.

I have a friend in Greeley, CO. In the last four years, the average sales price has dropped 20% in his market. The 100% financed buyers have been slayed. The "investors" have been destroyed. Not Nate. He kept buying. Why?

He bought on 15 year loans. He's paid off most of his properties. He owns 14 of them. Last year his rental income was more than his real estate income. Nate's the bank. And Nate's the bank with actual cash in the vault. While everyone else is worried about the value of their home being worth less than what they paid for it... he's increased rents 25% in the last 18 months because no one can buy anymore. Since he owns them outright... a 25% increase is total profit.

A Feel Good, Friday, Freebie

Thank you Guy Kawasaki for Chocolate Cake in Five Minutes.

See, these are the things you find on Twitter... Family, Occupation, Recreation... Dessert.

Price Wars: Only In America

Here is an actual quote from Katie Benner at Money Magazine explaining Fannie Mae and Freddie Mac's massive problems in laymen's terms:

In the meantime, the companies were allowed to operate in this manner, piling on risk after risk, with virtually no capital cushion (Wall Street speak for the rainy-day piggybank financial companies keep should one of their investments blow up.) As the company's loan portfolio loses value and the mortgage market continues to crumble, it's easy to see why this was a fatal misstep.

Some saw the crisis coming before this week. For example, Alan Greenspan famously warned in 2004 that Fannie and Freddie's rapid growth needed to be curbed because their expansion threatened the financial markets.

Still, the cocktail of high credit ratings, domination of the mortgage securities market, and preferential government treatment led to the sort of shenanigans that go hand in hand with excessive privilege.

Fannie overstated its earnings by $10.6 billion from 1998 through 2004, and its chief executive Franklin Raines lost his job. Freddie Mac had understated its profit by nearly $5 billion from 2000 through 2002. Both companies missed earnings filings while their (sic) overhauled their books.

• I really, really, really believe in a free-market system.
• I really am a capitalist at heart.
• I'm chronically accused of being a whacked-out liberal by my peers in what is a traditionally a very conservative, bordering on libertarian profession. 
• I also try and avoid being overtly political in this space, and prefer to talk about possibilities rather than reactionary historical commentaries.
• But a reactionary historical commentary is in order. We need some serious financial regulation and whoever wins in November can craft a savvy economic political platform on how they will do this.

What's completely galling is that Fannie experienced the degree of problems they had from 1998 to 2004. Only two of those years, 2003 and 2004 were big run-ups in the market. Over-liquidity of borrowed money was the number one culprit behind real estate values reaching unaffordable peaks, and of course, the number one reason for the implosion.

If these are the folks who are supposed to "make lending safe" by providing the baseline underwriting standards for more than half the mortgages in America, and these are the folks who create the ability to securitize loans (a word that by the way, is spell-checked by any word processing program as "not-a-word" but we take for granted... huh) which banks use as an incentive to be more willing to lend... and they are operating just like the health and wealth investors that are crippling America.

We have become an economy of wants, not an economy of needs. That's a Seth Godin summation. Real estate is one of the three basics, "food, shelter and clothing.". That's a Larry Kendall principle. Their teaching and writing mentor my business. Neither is disproven. Supply and demand will beat on. I'm not just for some powerful regulation: the entire system of finance needs re-invention. Here we are on the precipice of the mortgage industry's secondary market falling apart. The reason there is the possibility of a bailout is because while other industries were targeted by the big bad nasty Feds and the SEC, Fannie and Freddie got their wrists slapped. In the meantime, Inman News's Guest Opinion slot today is taken by Brad Inman himself. Brad isn't the one to forecast a bubonic plague for the real estate world. Saying that, read with caution.

What all of this gets back to are people who needed to borrow money to build a Death Star. I mean, there are some good, basic reasons to have a Death Star. Build a big enough one, and you keep labor happy by providing them with jobs. It certainly improves the value of the neighborhood, what with all those rooms and the granite landing pads, even if it might be a little garish and off-putting in it's design. Steve Wynne's neighbors don't complain... much. And there is something to be said for the law and order brought to civilization, both by such a great instrument of security as well as simple ownership.

Oh, that ownership, thing. This is the path Fannie Mae made easy for millions of Americans, and the rules were the same for those who attended a Real Estate Riches Seminar and learned how to securitize their own investment (which completely violates any deed of trust ever written, but let's not regulate that or let the law get in the way). The insidious concept that was at play inside Fannie Mae was that it was all secured. The problem was that a loan was secured by a loan, secured by a loan, secured by a loan. So yes, eventually the Chinese or a sheik in Abu Dhabi did own some of your home. Because they were the only ones with cash. In America, it was all loan after loan after loan.

Four of the five cheapest homes in Flying Horse right now are asking $30,000 less (or more!) than the combination of their loans owed against. There are at least six properties like this in Barnstormer Landing in Widefield. There are probably 500+ properties in the MLS like this, published MLS asking prices  for less than what they owe. Subprime mortgages were the first wave of default at this time last summer. The subprime thinking though has been leading the charge at Fannie and Freddie for a decade.

Fannie and Freddie presently have $5 trillion in loans securitized.

Price Wars: A New Hope

Cue the John Williams track, the second half is here.

Characteristics of the 2nd half of the 2008 sales year:
1.) There will probably be fewer transaction in the 2nd half than the first (seems to be the trend every year over the last decade). Will sellers get more optimistic with fewer showings or less optimistic?
2.) About 45% of all listings taken will sell in 2008. So if you're on the market now, and there will be fewer buyers in the second half, has your chance to sell increased or decreased?
3.) Schools starts in D49 and D20 within 5 weeks. D11, D38, D2 and D12 are all up and running within 6 weeks. Do you think sellers will become more patient or less patient once school begins?
4.) We enter the 2nd half with the slowest relocation - purchasing traffic in 15 years. Since sellers like relo buyers (they don't know areas as well, they tend to buy more-conforming real estate, they're attracted to similar values like schools, 4 bedrooms, attached garages, etc. AND most importantly they have 72 hours to make up their minds), do you think sellers will like working more or less with local buyers?
5.) Most of the sellers who are on the market now, actually need to sell. That means one of the 6600 sellers on the market right now probably has this as their reason to sell: they can't afford their payment; they are already behind on their payment; the bank is the payment; they are relocating out of market; they started out priced too high; they started out under-conditioned. Given those motivations to sell, and reasons 1 through 4, do you think sellers will be calm and collected or more apt to make emotionally-charged decisions?

As the trumpeting fanfare ends, the scrolling back-story disappears into deep space, and the mysterious woodwind music begins...

What is presently really weird is that places with scarce inventory still have sellers stuck in their properties. Some of these are some of the most desirable parts of town:
Skyway
Westside (Pleasant Valley)
Mountain Shadows
Peregrine
Pine Creek
Flying Horse
Downtown

What makes all of these areas really interesting is that they are all prime areas for buyers who already live in Colorado Springs to migrate to. The people likely to migrate to these areas usually live in places like N/E, PWR and EAS MLS, all areas with less than 6 months of inventory presently. These areas usually are heavily reliant on relocation traffic, and while they are slower than usual this year, they are receiving the bulk of first-time buyer traffic. The Gen X/Gen Y surge plus the enormous immigration to the United States will create millions of first-time buyers in the next ten years. They are starting to do something now.

Relocation buyers usually don't find Erindale when they come to town. It's right there near I-25 and Woodmen, yet no one really knows how to get back there. It's the views of University Park with more trees for $150,000 or more LESS. Working with a relocation buyer who gets their sites set on Rockrimmon at anytime is always hard. They usually end up in D20, but in Briargate. East of I-25, owners become sellers pretty quickly. West of I-25, sellers sometimes buy and die... they never move again.

So here is the odd scenario:
What is selling: Northeast, 4 bed, 4 bath, 2 car garage, a/c, 2500 square feet, 4800 square foot lot, some updates, feels like a nice, 2001 built suburban home. $260,000 (list price)
What is not selling (but boy what a buy!): 4 bedroom, 2 bath, 2 car garage, 2300 square feet, 11,000 square foot lot, great windows and carpet but an out-dated kitchen, bi-level floorplan and  shake roof, but... amazing gardens and landscaping and a straight on view of Pikes Peak from the whole upstairs, deck, yard. $275,000 (list price)

Those are facts. This is the opportunity:
An east-side resident who wanted to move west: probably never has a better chance. There is always scarcity on the west side, and the Gen X/ Gen Y buyer prefers shiny-new-houses. Stainless appliances. That kind of stuff. The difference in dirt value between the two homes above is about $80,000. But the asking prices are $15,000.

Author's Footnote: For the record, I'm not a Star Wars geek and that's not my stormtrooper suit. There's just an over-abndance of moronic, but funny Star Wars returns whenever you do a Google Images search. I think it's a built-in part of their algorithm. What you focus on... expands. Thank you Google-geeks.

Mid-Year Market Update: July, 2008 Stat Pack

I had a great lunch today with a fun past client. He's THE inspiration for the Stat Pack (because he asked questions I couldn't answer when he sold his home. I was hell-bent not to replicate that!). He's a thinker and he asks questions. Lots of questions.

We spoke at some length about a town neither of us had been to, but fascinates us both: Austin, TX.

I'm a Colorado guy, I like small, cool streams, long hikes in the quiet woods, the San Miguel River is right there with the best of Kaua'i for my favorite places I've ever been to. And yet Texas ends up in the equation. Why?

• It seems kind of recession proof
• Inclusive
• Not exclusive
• Good public schools
• Great public higher education
• R&D everywhere and a spirit that embraces that
• Venture Capital
• Not huge, the right size
• Some good recreation
• Good culture
• Good food
• Close to the rest of America
• Not Houston

For me, it's a fascinating place because despite all the oil money that floods into UT and keeps tuition lower than most other mega-universities, the wind and solar power movement in the United States has the biggest following "deep in the heart of Texas".

Why talk about Austin on a Colorado Springs Real Estate Blog?

There is a lot to be said for being recession-proof. There is a lot to be said for massive industrial diversification, for embracing creative and green industries and operating out of the heart first and the wallet second.

The Colorado Springs Real Estate market is still mired in the trough of the market downturn. Nancy Rusinak was quoted in the Gazette today saying "we'll take flat" which is where we are. Why we're flat and not rebounding is because all of the following happened in succession:

• Our supply went up (2003)
• Our demand went up (2003)
• Our prices went up (2004)
• Our demand went up (2005)
• Our supply went up (2005)
  
• Our demand went down (2006)
• Our supply went way up (2006)
• Our prices went sideways (2007)
• Our supply went up (2007)
• Our prices went down (2007)
  
• Our supply went sideways (2007 and 2008)
• Our demand showed up... but didn't doing anything (Now)

There is no question that people now want to buy real estate in Colorado Springs.

The problems are:

• They didn't save much during the boom
• Lenders now require this pesky thing called cash in your account
• If they are in tech, they are back to worrying if their job will be here in six months
• If they aren't here, there is no one looking at their home for sale elsewhere

If you do the complicated math and look back in time, our estimates are that two in three buyers last June were relocating to the area. Relo was hot because people from other markets saw their markets starting to tank and liked what they saw here (affordability). They got out before the door hit them on their backsides and they could buy here. Now we're estimating that this June, two in three buyers were local. It's a stretch, but let's do the math: 2/3rds of 1050 sales is about 700 relocating buyers, June 2007 (average relo, down local); 2/3rds of 870 sales is about 570 local buyers, June 2008 (down relo, average local). Total of the two "averages": 1270 units.

There have been only three 1300 unit months ever in our MLS and 1270 would be the 5th best month in terms of unit sales.

If...

Pipe Dream... Over.

What is going on instead is that there is this big give and take that is tearing things up. Buyers here that are local have the desire, but lots of options. They don't ever have their showing interrupted by another eager-beaver buyer hopping out of their agent's Escalade to snipe the property. They know the areas, and often hold out as long as they like for "it". So 1270 units is 100% hypothetical. The present reality is that there is 50% more selection than the 2005 peak and 40% less demand. In showing terms, 1 + 1 does not equal 2, and that delta really means that showings are about 1/4 of the pace they were in 2005. We are seeing 0.8 showings per property right now. Since the buyers are almost all local, there are whole areas of town that don't get shown (because our relocation traffic tends to buy east and if they stay, migrate west).

So here is something you won't find in the Mid-Year Stat Pack: Where Ben predicts the monster deals will be in the next six months. Why "monster deals?" Because sellers are giving up. They are scared. They need to move somewhere, change jobs, or their ARM is about to eat them alive and they've had two years worth of knowledge to know buyers are frugal pesky varmints and their market is entirely composed of frugal pesky varmints so they'll have to deal with them eventually. Ladies and gentlemen, behold the best time to be a frugal, pesky varmint. Understand also, that when I say monster deals, what I'm saying is that presently the active inventory in these areas is still over-priced and will correct to "market value". I think market value looks a lot like what homes were worth (without puff and fluff) in later 2005 and early 2006.

1. Flying Horse: Put a big bullseye on this area. There are two kinds of owners in Flying Horse: the ones who bought for the community and Discovery Canyon who don't plan on moving anyway, and the greedy health & wealth, over-leveraged investors/ wannabe-investors. The former is almost completely absent from the roles of present sellers right now, because they bought for the right reasons (the long-term) and filled with dozens of the fly-by-nighters who lived big and cratered bigger. Flying Horse has a lot of smart people living there enjoying the view and the pool and a lot of people who bought a home with a loan designed by a really smart-scheming person, and now they have a bank who can choose to live in their home. Look for more smart people to join the club, especially with the Parade headquartered here in August
2. Broadmoor Spires: lots of inventory, not much activity, a huge price appreciation in 2004, 2005, 2006 and even 2007 has left this market slightly over-valued by the selling community. Here the motivation is different, sellers in 80906 tend to have big equity positions. They can almost always get deals done if they need to and they always understand: money is made on the buy. The deals done here could be to go after really big properties further up the hill in the Resort. Ben's favorite stat to date: 13 deals done over $1 million YTD, all of the Pikes Peak MLS. That's it. Again, Broadmoor residents are no dummies. If they want to live larger, they have a great chance.
3. All of N/W. The only markets that are selling well right now are under $250,000 in N/E, EAS and PWR. If these are individuals staying in Colorado Springs, they are headed to one of three MLS areas: NGT (see Flying  Horse), BRI (Pine Creek, which is number 4) and N/W, almost all of these for D20. Migration patterns are east to west for local buyers and first time home buyers and the limited relo is buying out east. That gives these individuals the opportunity to position their home as a strong value amidst an easy-to-compare marketplace and seek life in the foothills.
4. Pine Creek: Big inventory, lots of $475,000 to $650,000 properties heavily impacted by 8% jumbo loans (loans over $417,000). Some major league price wars will happen here this summer and fall, sure to be the talk of the neighborhood. Activity was off the charts in late 2005 and 2006 up here and correspondingly, lots of buyers paid too much in the panicked-buying. Now the harder part comes, the panicked-selling. This will probably be the scene of some fast activity, and while it will probably draw prices down in the next six months, it will be temporary. Pine Creek's location, views, composition and perceived livability by relos and locals alike will allow it to rebound quickly by the start of Summer, 2009.

There are other areas that will probably see some additional activity. Areas that need to see activity include Fountain, especially District 8 and downtown where values have remained relatively stable. There is an abundance of affordably priced, Grade A newer construction for investment purposes. Soldiers will want to live in a house, but they will not want to buy. Rental rates cashflow down here with as little as 10% down.

Am I buying?

Nope. I'm eliminating debt. I'm paying off my car by the end of next month and then I have to get my HELOC worked off. This is also a weak year, I work 100% on commission and I have to have my reserves over-stocked. A buyer should use their real cash not their borrowed cash to act. I'm classifying myself as a 6 to 9 month planner. The money I save from my debt service will allow me to make at least one purchase in 2009.

If I had it would I? Yes on investments. I would 100% buy my own listing on Dassel Drive. But since I'm sitting this year out, I'm part of the "problem".