I have been broadcasting for several years now, and I’d like to think I devote more time to facts and statistics than most other broadcasters. Regular listeners will have by now acquired a robust knowledge base on the real estate and mortgage industries, as well as on our local and national economies. But facts, figures, and statistics only go so far. A theoretical knowledge of how these industries function is little help when it comes time to make a home purchase and you suddenly find yourself in a frenzied and frantic state of mind. This week’s show is devoted to managing expectations, tempering emotions, and remaining calm and collected throughout the home-buying process.
The surest way to prevent episodes of panic and frustration is to know your market before you start shopping. When making a purchase as large as a house, it’s common to consider how that house fits into its local market and how that local market will affect the house in the coming years and decades. Once you sign a purchase contract, you may start wondering whether the market is going up or down; whether waiting a year or two would make better economic sense; and whether the neighborhood you’re buying in is improving or hitting the skids. It’s better to have these answers before you start shopping—to know your city, understand its neighborhoods, and be able to anticipate where those neighborhoods are heading in the near-to-mid-future.
To help understand where the Colorado Springs and Denver markets are heading, I had Bill McAfee of Empire Title in the studio this week to discuss these two markets. The big take-away this week is that Denver is absolutely a seller’s market, and Colorado Springs is heading in that same direction. Inventory is still incredibly low, the few houses listed are selling incredibly fast, and sellers are able to sell their homes without making many, if any, concessions to the buyer. In Colorado Springs, the mean house price has reached $225,000—a new record. While there is still more value to be found outside of Denver, homes anywhere along the I25 corridor will no doubt be appreciating in the coming years.
It would be difficult to make a bad purchase when considering Denver, Colorado Springs, or the surrounding towns as a whole. But you should consider the neighborhood that a house is in before deciding whether to purchase it. For example, I had one radio listener who told me she was interested in purchasing a home in the same neighborhood she had grown up in. Her interest was entirely sentimental, and the unfortunate fact is that neighborhoods go through roughly thirty-year cycles of decline and rejuvenation. It’s likely that the neighborhood a person grew up in is presently in a worse state than he or she remembers it. This radio listener would be wise to study her neighborhood thoroughly and understand where it’s been and where it’s likely to be in the near future before deciding to purchase in it.
I regularly hear from radio listeners who began the home-buying process with confidence but suddenly find themselves panicking about the entire process. It’s a natural response that helps focus the mind and forces the buyer to consider all aspects of the purchase. But it can become overwhelming and lead to bad decision-making. If you’re beginning the home-buying process and are beginning to feel uncertain about the process, please feel free to give me a call to discuss your uncertainty. I’ll try to collect anecdotes from listeners to share on the air, and hopefully help other listeners who may be having the same uneasiness.
5-23-15 Shelter Skelter