Your Trusted Real Estate Advisor

2008 signals major changes for foreclosures and "short sales".  A new Colorado Foreclosure law took effect January 1, and some new Colorado Real Estate Commission (CREC) rules and forms will be mandatory March 31.

The chart shows what has taken place with single-family homes over the past 4 years in the Denver Area. Figures are from Metrolist, Denver's Multiple Listing Service.

Over each of the past 4 years fewer homes have sold each year than the prior year, and the number of homes on the market has increased. The trends indicate that at some point in the future the lines would meet and we would have as many homes on the market as sold in an entire year.

However, that kind of "linear projection" gives a false picture. Nothing stays the same, including trends in Real Estate. The line will go up someday, maybe this year.

This chart doesn't show the number of Days on the Market (DOM), but when I look at those stats, certain areas look better than others. So, we can't look at one chart and say what the market is doing in a specific area.

For example, the DOM for Highlands Ranch is 66 (2007 data), while in the Brighton area it is 134. Aurora North DOM was at 115 and Aurora South at 93. For all areas the DOM for single family homes was 102. The same concept applies to other data (sales relative to homes on the market, average sale price, etc.).

Would you believe there are homes available (nice homes) for under $150,000 in the Denver area?

Most of the homes in that price range are either bank-owned or "short-sale" properties; and a lot of those look pretty bad. When someone loses a home to foreclosure or is in danger of that happening, they sometimes just don't care what it looks like. Some of the homes I've seen have been trashed by the previous owner. Others just have a lot of deferred maintenance because the owner didn't have the money or the desire to keep them up.

But some of these homes are in great shape. Yesterday I showed one such home. It has 3 bedrooms, 2 baths, a finished basement, and a 1-car garage; and it was priced at $129,900.  It looked better than many $300,000 homes I've seen.

It is advertised as a "short-sale". That means the owners are desperate to sell, but they owe more than they can get out of it.  So the bank has to agree to accept a payoff less than (short of) what is owed. 

With interest rates down below 6% again, and prices like this, it's an ideal time to buy (either for investment or for just an inexpensive home to live in).