Here Are Some Obstacles (Real or Imagined) Faced by First-Time Home Buyers

Real_Estate_Today_bylineMany home buyers, especially first-time home buyers, would like to buy a home but harbor misconceptions about the obstacles they might face along the way. Here are some perceived obstacles.

Down Payment

Many buyers are misinformed about minimum down payment requirements.  They may think that a 20% down payment is required to purchase a home, or that they’ll be charged mortgage insurance if they put less than 20% down. In fact, some conventional loans require only 5% down, and while they do require mortgage insurance initially, that expense can go away once you can demonstrate 20% equity.

Indeed, even 5% is not the minimum down payment.  FHA loans require only a 3.5% down payment, and VA loans require no down payment at all to qualified veterans. The Colorado Housing Finance Authority (CHFA) can get a first-time home buyer into a house with only $1,000 out-of-pocket. CHFA also has a program which includes a down payment that is an outright gift to the buyer, and their Mortgage Credit Certificate program allows first-time and veteran homebuyers to get a tax credit for 20% of their interest expense for the life of the loan.

Credit Issues

The credit reporting agencies have done a good job of informing us about what is a good credit score, but we still encounter people who believe that derogatory credit entries are insurmountable barriers to home ownership. I had a client who had a bankruptcy and two foreclosures in her credit history, along with a sprinkling of minor late payments. Using one of our preferred lenders (Jaxzann Riggs), she still obtained a 3.5% down loan. While medical collections still factor into credit scoring, those under $2,000 are typically ignored by Fannie Mae and Freddie Mac underwriting software. Most credit obstacles can be overcome within a 6- to 12-month period if the client has some discretionary income.

Student Loan Debt

Fifteen years ago student loan debt averaged $15,000, but today it is $35,000 and growing. Most underwriters will now accept income-based repayment plans of student loans (if reported to the credit bureau) as opposed to fully amortizing payments. Fannie Mae now allows student loan debt to be included in refinances without categorizing the loan as “cash out” (which would impact the interest rate). Families with children living at home could use this option to reduce the burden associated with student loans.

Unwarranted Risk Aversion

Another emerging segment of our marketplace is millennials who experienced the loss of their family home. One day Dad was employed, and the next he was not, and 6 months later they were out of their home. They do not trust that the employment market will always be so robust and therefore opt for the perceived security afforded by renting. A good Realtor and loan officer can help a buyer understand and recognize the advantages of home ownership vs. renting, making the decision to buy feel safer.

Limited Inventory

While it is true that there are fewer active listings on the market and that there is more competitive bidding, especially in the lower price ranges, it is definitely possible to succeed at buying a home when you have the right real estate agent and the right loan officer.

It is possible to be notified within 15 minutes of any new listing that meets your search criteria, so there’s no reason to be late to the process — so long as you check your email regularly. Here at Golden Real Estate, we are particularly successful in winning bidding wars for our buyers. Just last week, for example, our buyer was the successful bidder for a Belmar townhome, which was accomplished by matching, not beating, the next best offer. How? By offering totally free moving to the seller using our moving truck, laborers, moving boxes and packing material.  All of these costs will be covered by Golden Real Estate, not by our buyer.  Of course, covering moving expenses is only one of the many advantages Golden Real Estate’s agents bring to the table, so give us a call!

Lenders and Loan Officers

A good loan officer, such as Jaxzann Riggs of The Mortgage Network, who assisted with this week’s column, can make a huge difference in helping buyers get into their first (or next) home.  A good local mortgage broker like Jaxzann makes a better impression with home sellers and their agents than any online lender and even some banks. You can reach Jaxzann at 303-990-2992.


Is Deporting Immigrants, Including Dreamers, Bad for the Economy?

Elliot EisenbergEvery January, economist Elliot Eisenberg comes to Denver from Washington, D.C. to update Realtors and lenders about the economy and the real estate market. I attended two of his presentations in January and was struck by his remarks about the recent tax reform legislation, which he called “a mistake.”

Reducing taxes when the economy is this healthy makes no sense, he said. Yes, it will have a positive effect on some business, but for only 12 to 18 months, and no more.

Part of what makes our economy healthy is our low unemployment rate, which can’t go much lower. In short, Eisenberg says we need more workers. In light of that statement, I asked him about the possible deportation of DACA children (many of whom are now working adults) and non-DACA illegal immigrants who are also working and paying taxes. He responded absolutelywhen asked if he believes that deporting these workers would only make matters worse for our economy.

I’m reminded of something former President George W. Bush said after Hurricane Harvey: “Good luck rebuilding Houston without immigrants!”


Golden Split-Level Home Just Listed by Jim Swanson

1060 Yank StreetThis awesome move in ready home at 1090 Yank Street, listed at $439,000, is just minutes from the Colorado Mills Mall, with easy access to both 6th Ave and I-70. Welchester Elementary School is only one block away, and Daniels Park is also nearby. The roof, gutters and siding were replaced last summer, and the entire home was painted inside and out. The interior has 3 bedrooms upstairs with a large master bedroom/bath and good sized 2nd and 3rd bedrooms served by a 3/4 hallway bath. The updated kitchen features a new refrigerator. Walls were removed to create an open floor plan, with hardwood flooring throughout, including on the stairs. The lower family room has a wood-burning fireplace and a full bath. The large private backyard has a covered patio, garden area, shed and 8.5’ x 14’ motorcycle garage. A newer (2011) boiler provides the hot water baseboard heat. Cooling is provided by a roof-mounted swamp cooler. Take a narrated video tour at, then call your agent or Jim Swanson at 303-929-2727 for a showing.  He’ll be holding it open Saturday, Feb. 3, from 10am to 2pm.


Life’s Transitions Are at the Heart of Most Real Estate Needs

Real_Estate_Today_bylineIn my 16 years as a Realtor, I have learned that most people’s real estate needs arise from life’s many and varied transitions.  These can include relationship changes such as marriage and divorce, a birth or death in the family, health changes, and other reasons for upsizing or downsizing, as well as job relocation, job loss, and changes in income. People also relocate to be closer to grandchildren or other family members.

Clients have come to us because of most or all of these “transitions,” but perhaps the most common is, sadly, divorce. When couples divorce, one option is for one spouse to buy out the other, and although the court (in a non-amicable divorce) might require a valuation by a licensed appraiser, often we’ll be called upon to give a “Broker Price Opinion” of the home’s value. I don’t charge for this service, nor do I think most agents would. If a sale of the home is necessary, of course we’re available to assist in that, and the proceeds can be disbursed as the couple or the court dictate.

Medical changes or uncertainty, which can affect people of all ages, often necessitate a home sale. We can help the seller of a multi-level home find a wheelchair accessible home or simply one with fewer stairs, and discount the commission on the sale of their current home when we earn a commission on their purchase. If the seller is moving to a rental such as in a senior community, we can refer them to a specialist in that field, such as Jenn Gomer of Care Patrol.

Marriage or simply the combining of two households is a happier transition, and, again, look for your agent to discount the fee for selling your current homes in return for earning a commission on your new home.

Empty nesters (and others) come to us on occasion wanting to downsize. They may want to use their new-found freedom to travel, and ask us to find them a “lock-and-go” home such as a condo or patio home, where you have no maintenance responsibilities and it’s not obvious when you’re away.

When children head off the college, they may want to live in dorms or fraternities/sorrorities, but some parents want to invest in a home near campus that they can sell for a profit (or keep as a rental) after graduation.  They prefer to buy homes with three or more bedrooms so that classmates of their son or daughter can provide rental income for the parents.

Relocation is a big area of need, too. This is a good time to “sell high and buy low,” by moving from Denver to, say, Goodland, Kansas, where a recent client of mine was able to buy a bigger house using only the equity from the sale of their Arvada home.  Now they have no mortgage!

With so many jobs allowing telecommuting, some workers want to leave the hustle and bustle of the city and live in a quieter, perhaps rural setting with good internet service. A client of ours who works for the federal government is allowed to work from home, so he moved to a sleepy town in Mesa County, even though his “office” is 200 miles away in Lakewood!

What life transition are you facing?  Whatever it may be, it’s important that your real estate professional is ready to listen to your wants and needs and can be a compassionate consultant, supplying information and advice that helps you make the best decision for you and your family.  Call us!  We are eager to be of service.


Did You Know That the Best Car for Wintertime Travel Is Electric?

Consider these reasons why you might prefer an electric car (EV) during the winter.

No warm up needed. Just get in and go. And the cabin will be warm within half a mile.  No puffing!  If your car is parked outside and has ice or snow on it, you can turn on the heat remotely without unlocking it 10 or 15 minutes before you want to leave.

You’ll never break down. Winter is a terrible time for a breakdown, isn’t it?  There’s nothing to break down in an EV, and it will never “stall.”  The only time you’ll see an electric car in the breakdown lane is if it was in an accident or has a flat tire.

No filling your tank during in the freezing rain or snow. Think of your EV like your smartphone. You plug it in at night and it’s fully charged in the morning. When you have an electric car, gas stations are just for cleaning your windshield and buying lottery tickets.

Traction is better in an EV. My all-wheel-drive Tesla is hands-down better in snow than my old Lexus RX 400h or, I wager, any car. Test drive one on a snow-packed road and you’ll be amazed, as I was.

You can leave the heat on while parked. It’s really nice to come back to a warm car with no ice to scrape. I left my locked Tesla’s heat on for several hours during a recent snowstorm and it only consumed a couple kilowatt-hours (22 cents’ worth of electricity, if you don’t have solar panels). When I was ready to leave, the windows were all clear and the cabin was 70 degrees!  The same feature works during summertime.  I don’t have to return to a car that’s over 100 degrees in the sun.


Just Listed: A Solar-Powered Home Near DU With a $5.89 Monthly Xcel Bill

1960 South Gilpin best pictureWould you like to own one of Colorado’s — and possibly the nation’s — most energy efficient homes?  Here’s your opportunity!

At Golden Real Estate, we love listing “net zero energy” homes such as this one at 1960 S. Gilpin Street in Denver. This particular home, listed just this week for $890,000, goes beyond net zero, generating more electricity than it uses, including the charging of the seller’s electric car.

This home was designed to meet passive house standards, meaning that, among other features, it is super-insulated and has triple- and quadruple-pane windows. The exterior walls of this home were built with structural insulated panels (“SIPs”) which not only insulate the home but make it super quiet inside.

SIPs_-_Structural_Insulated_PanelsAt left is a picture of one of those panels being installed.

Because of its sustainable features, this home has been on tours of solar homes four times since its construction in 2008. Click here to view the narrated video tour of it which I myself produced for the 2016 solar tour. That video was limited to the home’s solar and sustainable features. Now that it is for sale, I have produced a new narrated video of all the features of this house. You can view that video at

In 2012, the Colorado Renewable Energy Society (CRES) gave this home its coveted “Award for Renewable Energy & Sustainable Design in Buildings — Residential New Construction.” Space limitations here prevent me from listing all the reasons, but that video is a good start.

The home is so energy efficient that is has no furnace — in fact, no gas service at all. Limited in-floor electric radiant heating and one small wall heater provide enough heat in the winter, and the home requires no cooling in the summer because of its insulation and passive house design. A small propane stove provides extra warmth, but isn’t needed very often.

how-heat-recovery-ventilation-worksAs in all super-insulated and therefore air-tight homes, fresh air must be brought into the house using an Energy Recovery Ventilator (ERV) which improves air quality and also tempers incoming air by passing it through a heat exchanger with outgoing air. Thus, if it’s 30 degrees outside, for example, the fresh air entering the ERV could be as warm as 65 degrees by the time it is distributed into the home.  This schematic explains how an ERV works.

Hot water is provided by a solar thermal panel on the south-facing roof, next to the solar electric panels. Another special feature is the battery storage system which maintains electrical service during blackouts.

I will be holding this special house open on Saturday, January 27th, 11 a.m. to 2 p.m.


What Improvements Should You Make Before Listing a Home?

This is a common question that I get from my readers. Should they replace their appliances, paint the house, install hardwood floors or new carpeting, etc.

Let me share my usual response to this question. Keep in mind that improvements do not typically produce more in added value than what you pay for them.

The only improvements a seller should make, in my opinion, are ones which eliminate eyesores — that is, things which draw negative attention by a visitor.

I wouldn’t replace items that are dated but that are in good condition. I wouldn’t, for example, replace Formica counters that are in good condition, but I would replace them if they have burn marks or other damage.