As with all relationships, communication is key and this is certainly the case when you choose a realtor.  Your home is one of your most important investments.   Buying or selling a home is a complicated process –some deals go smoothly and some have difficulties.  Your realtor should strive to make the process as easy going as possible for you – I personally aim to make the process fun for my clients.

1)  It should be obvious that a realtor should return all your emails and phone calls in a timely manner, but I hear people complain often that their realtors do not do so.  Your realtor works for you and while realtors cannot be accessible 24/7, you shouldn’t have to wait too long with your important questions and concerns.

My stepmother was working with a realtor in Las Vegas when the realtor went on vacation.  If I go on vacation and will not be accessible by phone, I would email all my clients to let them know that I would be leaving, have an assistant ready to handle my client load in my absence, and have a voicemail recording outlining how to reach my assistant and my dates of absence.  I would also have a way to check in daily with my assistant if there are any questions that needed to be answered.  This realtor just left for two weeks.  No voicemail.  No email.  No notification.  Just left.  I told her to find a new realtor – that’s unacceptable.  Sure, we all want to run away sometimes and “disconnect,” but not at the price of someone who trusts and relies on you.

2)  Your realtor should be educating you about the home buying or selling process.  The Colorado Contract to Buy and Sell Real Estate is 17 pages long.  You should understand exactly what you’re signing, because it is a legally binding contract, so your realtor should be taking the time to educate you adequately.

Buying and selling is a very involved process, and you should be comfortable with everything that happens during the process.  Of course, stay realistic… we can’t sell your $400,000 home for $500,000, but you should understand why your home is being listed for a certain price.  Similarly, if you’re buying, beware of a realtor who seems too “salesy.”  Every now and then, if I see a great deal, I will stress this to my clients, but I’m not the one who will be living in the home and paying the mortgage.  I want my clients to be happy with the home they have selected, so I point out the potential problems that I see in a home or neighborhood as often as I point out the positives.  No property is perfect, but I want my clients to be aware of any concerns, so if they make a choice, they do so with eyes wide open.

3)  You should like your realtor.  You may potentially have to spend a lot of time with this person;  at times, I have taken clients to see 50 plus properties before they found the right one.  The time you spend with your realtor shouldn’t be annoying or awkward – it should be enjoyable!

Note:  You, as a home buyer or home seller, should also seek to communicate well with your realtor.  Your realtor may be fantastic, but if you don’t clearly define your needs and priorities, your realtor probably can’t read your mind.  Don’t let your experience suffer because you aren’t being proactive about getting what you want and need from your real estate transaction.

As your home is one of your greatest investments, let’s face it – you probably worked really hard to earn your home!  A realtor should respect that and hold their relationships with their clients in utmost regard.  Without our clients, our business cannot survive.   Beyond my desire to have a thriving business, I enjoy the opportunity to be a positive element in my clients’ lives.  I find it to be a great honor to help people with their homes – our homes are our safe zone, our sacred space.  I enjoy attending my clients’ house-warming parties, meeting their families, and watching everyone move forward in their lives.  My clients have brought a lot of joy to my life and every person deserves a realtor who really has their best interests at heart.

In the words of Abraham Lincoln, “Whatever you are, be a good one.”  So, if you’re a realtor… BE A GOOD ONE.  Scratch that… be GREAT.

The marijuana state, Colorado grunge rubber stamp, vector illustration

Many homeowners have feared that the introduction of marijuana dispensaries and stores would place neighborhoods at risk by contributing to higher crime rates and nuisance factors.  This is a valid concern – I notice everything in my neighborhood that could affect my home value, even if it’s as minute as a neighbor getting a new roof.  Homeowners SHOULD consider their home as an investment.

However, a study from the University of Colorado at Denver, one of my alma maters, has shown that pot shops do not negatively affect local neighborhoods, cause higher crime rates, or create other undesirable outcomes.  The study focused on 275 marijuana distribution facilities in 75 Denver area neighborhoods, comparing 2010 census data to data from the 2000 census before dispensaries were legal in Denver.  This study sought to discover whether dispensaries qualify as “locally undesirable land uses,” evaluating whether or not these types of businesses contributed to higher crime rates, economic injustice, etc.

The study authors expected to see inequalities especially with shops located in poorer neighborhoods.  However, the research showed no relationship between marijuana store locations with poverty rates or ethnicity, as recreational pot shops are dispersed widely throughout the Denver area.

“Everybody is saying that [marijuana stores] are undesirable.  If that’s the case, it’s certainly not showing up in the data,” said Paul Stretsky, co-author of the study and professor at University of Colorado at Denver’s School of Public Affairs.

A scale house on some forms for a deed to conceptualize on the financial investment.

What the heck is title insurance? Why should you buy it?

Well… unless you are paying for your home entirely in cash, lenders will not let you purchase a home without title insurance.  Title insurance ensures that the sellers truly own the property and that there aren’t any problems with the title.

Common Problems with Titles:

1) A previous owner had some construction done on the home and never paid the contractor.  The contractor can place a mechanic’s lien on the title.  You didn’t have that work done, so you shouldn’t have to pay for it.

2)  A previous owner skipped out on paying their property taxes, which resulted in a lien being placed on the title.  Liens are placed on the property, not on the individuals, so new owners need to protect themselves against the antics of previous owners.  T

3)  Forgery! There have been cases of forgery where scam artists search public records to find homeowners who reside out of state and attempt to sell the property as their own on the internet!  (There are so many creative honest ways to make money in this world, it always blows my mind when people do things like this to try to make a buck, but… it happens.)

4)  There are sometimes cases of missing heirs… maybe a child was left in the will and became estranged from their family… years later, the prodigal son or daughter returns and technically has claim to the property. Should this be your problem if you bought the house fair and square?  Of course not!

Title insurance protects home buyers against all of these potential issues and more.

Housing market price drop concept vector illustration

1) Home Buyers don’t consider resale before they buy.  Every house will be resold at some time in the future.  Granted, you cannot predict all future changes; the area or the economy could improve or decline.  Even so, the future value of the home should be a priority.

2)  Home Buyers base their decisions on what they hear in the national news. They need to remember that real estate is local; not national.  Several times when I tell people I do real estate, they look at me sympathetically and say, “Oh, I bet things are really tough right now.”  Well, they are… in Florida, in Nevada… even Chicago.  Denver is doing just fine.  Home prices have met and exceeded pre-recession prices.

 3) Home Buyers only talk to one lender. You need to shop for a loan, just like they shop for a house.  First, interest rates can vary from lender to lender.  Second, not all lenders offer all types of mortgage products, especially major banks.  I had a client who strongly preferred a condo to a home, but was told that he would have to make a 20% down payment on a condo.  I sent him to my preferred lender and within a day, he was qualified to purchase a condo with a 5% down payment.  So, we found him a great condo!

4) Home Buyers don’t read and understand the contract.  Colorado Real Estate Contracts are over 16 pages long, and your agent should  explain the contract to you.  Second, read over the contract carefully before signing.  I have seen realtors make mistakes on important details – like dollar amounts! 

5) Home Buyers don’t get prequalified with a lender before they start looking for a home.  Consequently they may be looking for houses in the wrong price range.  I have seen clients err on both sides – some think they will be able to afford something much higher than what they qualify for; others think they will only qualify for $150,000 when they qualify for $300,000.  (Note:  You shouldn’t necessarily purchase a home at the top dollar amount for which you qualify.  It’s good to give yourself some wiggle room in case of an unexpected financial event.)

6) Home Buyers don’t do their due diligence before buying, including checking on the crime statistics, checking out the schools, and checking out the neighborhood.  Buyers should also visit a neighborhood during different times of the day and different days of week; talk to the neighbors. 

7) Home Buyers buy the most expensive house in the neighborhood.  The most expensive home in the neighborhood is never the best investment, unless an ex-President lived in the home or unless they scrape all the other houses and build new homes larger than yours.  

To avoid these buyer pitfalls, among others, let us guide you through the home-buying process. Whether you are a seasoned home-buyer or a first-time home-buyer, we will have your back every step of the day. To contact one of our brokers, call Conscious Real Estate at 303-908-9873 or email our owner, Allison Parks, at allison@theconsciousgroup.com.

Home finance concept: residential house, office calculator, colorful bar graph and color pie chart isolated on white background

Getting ready to buy a home and want to get 30% of your interest payments back?  Keep reading.

The City and County of Denver 2012 Mortgage Credit Certificate (MCC) program allows qualifying borrowers to receive an annual federal income tax credit equal to 30% of the annual interest they pay on their mortgage loan. The tax credit enables a taxpayer to subtract the amount of credit from his or her annual total federal income taxes. Borrowers may choose to adjust their W-4 withholding to account for the tax-credit benefit and receive a higher net monthly income. Any excess credit from the MCC may be carried forward for up to three subsequent tax years.

This program will run from April 2012 to December 31, 2014.  Homeowners must keep their first mortgage and occupy the home as their primary residence.  The homeowner must not have owned another home in the past three years (unless they have purchased their home in a “targeted area.”)  Furthermore, the allowable maximum family income for families of 2 or fewer is $79,300 in a non-targeted area and $91,195 for a family of 3 or more, while the maximum family income is $95,160 for a family of 2 or less in a targeted area and  $111,020 for a family of 3 or more in a targeted area.  Click here for a list of targeted areas.

Note:  You must contact the appropriate government agency about getting an MCC before you get a mortgage and buy your home.

For a list of lenders who participate in the MCC program of Denver, please call us to get started at 303-908-9873.

New house buyers concept for mortgage, home loan

FHA Loan – This is a great program for first-time home-buyers, though you do not need to be a first-time buyer to qualify for this loan.  FHA loans usually require a middle credit score of 640 and tends to have more lenient guidelines than most other mortgages.

The Guidelines:

-Bankruptcies must be discharged at least two years ago

-Foreclosures and Short Sales must be at least three years ago

-Debt to income ratios are allowed up to 55%

-3.5% is required for a down payment

-Co-signers are allowed, as well as gift funds for a down-payment

CHFA Loan – This is another great program for first-time home-buyers offered by the Colorado Housing and Finance Authority.  CHFA is a organization that provides down payment assistance for FHA loans.

The Guidelines are the same as FHA Loan Guidelines except:

-Only a .5% down payment is required or a minimum of $1,000 down, whichever is more

-Buyers must complete a Homebuyer Education class that can be done in person or online

VA Loan – This is a great loan program for any veteran with VA loan eligibility.  Similar to FHA loans, this loan has very lenient underwriting guidelines.

The Guidelines are the same as FHA Loan Guidelines except:

-No down payment is required

-No mortgage insurance is required

Conventional Loan – This is the preferred program for any buyer with a higher credit score (at least 650) and can afford at least a 5% down payment.  Ideally, a buyer would need to put 20% down for a conventional loan.  However, buyers can now put as little a 5% down with various options for mortgage insurance.  (Generally, a higher credit score will gain the buyer a lower price on mortgage insurance.)

The Facts:

-Bankruptcies must be discharged at least 4 years ago

-Foreclosures and short sales must be at least 7 years ago

-Debt to income ratios allowed up to 45%

-At least 5% is required for a down payment

-Co-signers are allowed in most cases, as are gift funds

-With a slightly higher credit score and a slightly larger down payment than an FHA loan, a conventional loan ends up being a much cheaper option than an FHA loan

On a final note, buyers be aware that a conventional loan is often required when purchasing a condo.  If you have more in depth questions about which loan is right for you, give us a call or email and we will point you in the direction of a great loan officer!  Also, if funds for your down payment are a problem, look into the Denver Mortgage Assistance Program to see if grant money is still available for home-buyers who qualify for a home, but need assistance with a down payment.

house and money on scales. Isolated 3D image

A lot of people have expressed concerns to me about buying a home in the Denver market, as the rapidly increasing prices have raised concerns about a housing market bubble.  If you would like to learn more about current economic trends affecting the Denver market, click here.  For now, let’s consider some good maxims for buying a home in any city and any market.

Your home is one of your greatest investments.  There is absolutely nothing wrong with buying the home you like, wherever you like, BUT if you prioritize your home increasing its value, consider these following tips:

1)  Seek homes in walkable neighborhoods.  Walkable neighborhoods are becoming a high priority for home-buyers.  With increases in gas prices, people are moving back in from the suburbs and finding that its often more pleasant to walk to work, to the store, and to dinner.  A home in a walkable neighborhood will be more likely to maintain and increase in value.

If you are looking for a home in a new city, check the walk score.  Neighborhoods are rated from 0-100, with 100 meaning that multiple neighborhood businesses and parks will be within a stone’s throw.  The Riverfront neighborhood in Denver boasts some of the higher home prices in Denver and has a walk score of 98.

2)  Look for homes near parks and public transportation.  Homes that are near parks and public transportation are more likely to maintain or increase in value.  Once again, it’s where people want to be.  Location, location, location.

In Denver, an area which will likely increase considerably in value in the future is near the future lightrail extension by 38th and Blake.  If one were to purchase a home in this area now, in 3-10 years after construction is completed, the home value would likely have increased significantly.  Note:  choosing a location based ONLY on projected increases can be risky.  I recommend that you appreciate the location you choose as it is, in case projected improvements to the area never happen.

3)  Stay abreast of new developments that will make a location more desirable.  Glendale is already a desirable neighborhood to many, but when the Riverwalk is completed, homes near this development will likely increase in value because the neighborhood will be even more enjoyable.

4)  Learn a bit about the rental market in your area.   If rents on comparable properties are going for equal to or higher than your mortgage, this is good. If the vacancy rate for rentals in your city is low, this is good.  So, if, in the words of Kurt Vonnegut, the excrement hits the air conditioning and you no longer can afford your mortgage, you could likely cover your mortgage (and maybe even make money) by renting out your home and keep yourself out of foreclosure.  This could also benefit you if you have a job transfer to another city, while your current city is in a down market.  You could cover the mortgage (and maybe even make money) by renting out your property until the market improves so you don’t lose money when you sell your home.

Renting out your home may not be for everyone… Being a landlord contains its share of headaches, but if remaining financially strong is your primary goal, the ability to rent out your home can be a major asset.  Real estate markets aren’t so different from stock markets, and the mistake a lot of people make in stocks is selling when the prices are dropping.  Sometimes this can save you, but most markets will rebound and make their way back up.  Do what you have to do to weather the storm and wait it out.

5)  The home that is generally the best investment is the worst or smallest one on the block.  The home that is generally the worst investment is the biggest and best one on the block.  There can be some wiggle room on this… If , for instance, someone famous once lived in the biggest home on the block, that will be intriguing to future buyers.  If the worst home on the block needs major foundation work, a roof, and windows and would cost a great deal to get it up to snuff, it might not be the best investment.  If you are savvy about finding good contractors and can do some work yourself, consider purchasing and renovating the icky house in a great neighborhood!

6)  Choose a home that has eco-friendly features and make eco-friendly renovations.  From the tree huggers to the penny pinchers, home-buyers are increasingly desiring green homes.  Green homes sell for more than conventional homes; they sell more quickly and closer to asking price.  So, if you view your home as an investment, greening your investment will likely get you more green (money) when you sell, as well as saving you money while you live in your home.

If you are ready to buy a home and want to make sure you get the most bang for your buck and security in your financial future, let Conscious Real Estate guide you through the home-buying process. Call 303-908-9873 to reach one of our agents or email our owner, Allison Parks, at allison@theconsciousgroup.com.

Energy efficient house graphics with question and percentage marks against grey background

Is the Denver housing market is in danger of a bubble?  If someone you know has purchased a home in the Denver metro area this past year, you will certainly have heard about skyrocketing home prices, bidding wars, and properties often selling for higher than the asking price.  Considering that the home prices have quickly been rising while our nation’s economy still feels shaky, this is an understandable concern.

As with any bubble, real estate, stock market, or otherwise, a bubble can only be predicted in hindsight.  We don’t know where the peak (or the crash, for that matter) will hit, until we are past the hump or slump.

It’s worth mentioning that the Denver real estate market was not as negatively affected as many parts of the United States during the recession.  The subprime mortgage game wasn’t as prevalent in Denver, our economy remained stronger than many major cities, and our percentage of foreclosures was considerably lower.  The Case-Shiller Denver Home Price Index reported that metro Denver home prices have met and exceeded the pre-crash peak in 2013.

Much of the price appreciation has been due to the drop in interest rates.  During the recession, interest rates have been at an all time low, in the Fed’s attempt to keep money in the system and create more consumer confidence in home-buying.  Whether the attempt was psychological or not, when you buy at a low interest rate, as long as you can make your mortgage payments, you will greatly benefit in the long run by saving a boatload of money throughout the years on interest.

Denver, depending on which statistics you read, historically has had a 5% appreciation on home values.  (I have seen statistics reporting this number as high as 9%, but for sake of being conservative, I will report the lowest number I have seen.)  Most investments won’t yield more than 10% per year on average, and let’s face it – you can’t host a holiday party in your mutual fund.

Overall, the Denver economy is pretty strong.  Even if home prices drop for a bit, they most likely will recover and continue to rise.  Our state’s population has grown at almost double the national rate over the past few years.  State Demographer, Elizabeth Garner, states that of this growth, 55-60% of people are moving here due to a job change, indicating that Colorado is showing job growth.  Also, many young families are eschewing the coastal cities for Denver for lower taxes, lower cost of living, access to parks, and sunny days.  The Denver economy continues to grow with diverse industries – natural gas, mutual funds, clean energy, technology, and well… marijuana.

So, what do I recommend?  If you’re financially and emotionally ready to purchase a home, do so.  Interest rates are still low enough that even if home prices drop after you buy, you will still save money in the long run.  The Denver economy has remained strong and shows no indicators of slowing down.  The population keeps growing in Denver, and increasing demand for homes will keep prices up.

If you think you may be ready to talk a real estate professional about purchasing or selling your home, please contact Allison Parks at Conscious Real Estate at 303-908-9873 or allison@theconsciousgroup.com.

People walking on a street motion blur

Walkability is a measure of how friendly an area is to walking.  A high walk score mean that you will have neighborhood restaurants, coffee shops, grocery stores, schools, parks, and more nearby.  It also means you will have more public transportation options.  (Walk scores range from 0 to 100, with 100 being the best.)

The Walk Score website reports that people who live in walkable neighborhoods weigh 6-10 pounds less.  Walkable neighborhoods can save residents a considerable amount of money, as cars are the second largest household expense in the United States.  Walkable neighborhoods are also eco-friendly, as 82% of CO2 emissions are from burning fossil fuels.  Short commutes reduce stress and increase community involvement.

For help in finding some of Denver’s best walkable neighborhoods with homes for sale, let Conscious Real Estate guide you in your next home purchase! To contact one of our agents, call 303-908-9873 or email allison@theconsciousgroup.com.

green paint and paint supplies ready to do home improvement

FHA’s Streamlined 203(k) program permits homebuyers and homeowners to finance up to $35,000 into their mortgage to repair, improve, or upgrade their home. Homebuyers and homeowners can quickly and easily tap into cash to pay for property repairs or improvements, such as those identified by a home inspector or an FHA appraiser. Homeowners can make property repairs, improvements, or prepare their home for sale.  Homebuyers can make their new home move-in ready by remodeling the kitchen, painting the interior or purchasing new carpet.

This could be very useful for you if you don’t mind buying a home that may not be move-in ready or would like to have the home customized to your taste… that’s right, the kitchen and bathroom would be designed by you.  For those of you who are passionate about sustainable living, the 203(k) loan could utilized to do green upgrades, such as energy-efficient windows, ENERGY STAR appliances, high-efficiency furnace with sealed ductwork, and solar panels.

The Section 203(k) program is FHA’s primary program for the rehabilitation and repair of single family properties. As such, it is an important tool for community and neighborhood revitalization, as well as to expand homeownership opportunities.

Note:  It is recommended to use a 203(k)-approved contractor for improvements.