Here’s an End-of-Year Special for New Clients of Golden Real Estate

As regular readers of my column already know, Golden Real Estate has two moving trucks available for free to buyers and sellers. We’ve also made it available to other agents’ sellers as an enticement to accept our buyers’ offers on their listings.

This past weekend, I was trying to think what a real estate firm like ours could offer as a “Black Friday Special,” and I came up with the following deal for new clients.

For the month of December, we’re not only going to provide free use of our moving truck to buyers and sellers, we’re going to provide the labor, moving boxes, packing materials and gas for the truck. The only limitation is that your move be IMG_1256within the Denver metro area — and that we earn a commission!

Our free moving trucks have been so popular that last year we purchased a second one. In addition to providing them for clients, we make them available to local non-profits, including several churches which participate in Family Promise of Metro Denver’s program that provides temporary shelter to homeless families.

We figure our trucks save our clients and our non-profit friends thousands of dollars per year, versus the cost of the typical moving van rental.

We look forward to serving you, too!

 

Winter’s a Good Time to Sell a Home, But It Can Be a Good Time for Buyers, Too

By JIM SMITH, Realtor®

I’ve written in the past about how winter can be a great time of year to sell a home, as there’s often less competition for buyers’ attention due to lower inventory.  Also, buyers who may have failed to secure a home earlier in the year are still out there, and still getting auto emails with new listings (yours?) that match their search criteria.

But let’s look at winter from the buyer’s perspective for a moment. Here are some reasons that buyers might want to include house hunting in their holiday shopping plans.

First of all, it’s likely you’ll be competing with fewer other buyers, particularly in the weeks leading up to Christmas. This could make it easier to land the home you fall in love with.

Second, homeowners who put their home on the market during December may be a bit more motivated to sell for reasons that may or may not be disclosed.

For example, there could be a job relocation, or they may have tax considerations making them want to consummate the sale before year’s end. Check the days on market for each listing. If the home was listed in the summer or early fall, the seller may be in a position to settle for less now that it’s December.

You, as a buyer, may have tax considerations of  your own. Some of your mortgage closing costs are tax deductible, so you may want to close in December to get those deductions a year earlier.

On the other hand, if you close on a home in January from an elderly seller who has a senior property tax exemption, that tax exemption applies to you, too, for the entire 2018 tax year. (That benefit is based on who owned the house on Jan. 1st.) Weigh this against other tax considerations before deciding whether to close on that house in December versus January.

 

How Can Applying Feng Shui Principles Improve Your Home?

feng shui logoPerhaps you’ve heard of the ancient Chinese art of Feng Shui (pronounced Fung Shway). As explained at www.dummies.com, “It enhances your environment according to principles of harmony and energy flow. Whether you’re aware of it or not, your environment — and your relationship with it — are constantly affecting you. Consequently, your best bet for a healthy, happy, and successful life is to make your environment work for you through the practice of Feng Shui.”

I have only a passing familiarity with it, and find that some of its principles are, dare I say, a little “woo-woo,” but other principles make eminent sense and I believe that I have benefited from applying them.

For example, it is believed that open drains, including open toilet seats, allow energy (or “chi”) to be drained from your home, so Rita and I are diligent about keeping the lids down on our home’s (and office’s) toilets. Besides, it looks better, don’t you think? I advise sellers to do the same while their home is on the market.

Clutter is a big no-no. I remember when I owned an office building on Capitol Hill in the early 1990s, it had a side yard that was filled with debris and trash. I paid little attention to clearing it out since it wasn’t visible to passers-by, but a Feng Shui consultant urged me to clean it out, and when I did, I was noticeably more successful in attracting tenants.

One principle that makes sense to me, but that I tend not to practice, is that of keeping my desk clear of clutter. I know I feel better when I have cleared my desk. I remember being told during a tour of RE/MAX International’s executive offices that co-founder Gail Liniger had a strict rule that every desk must be cleared before leaving work each night. It’s easy to imagine the psychological effect of that practice, and it sounds as if Gail’s rule might be rooted in Feng Shui principles.

When It Comes to Real Estate Statistics, We Should Think “Median,” not “Average”

By JIM SMITH, Realtor®

Excuse me for getting a little nerdy here, but it’s important to know the difference between “median” and “average” when studying the real estate market, and here’s why.

Let’s say an area has five home sales: one at $300,000, a second at $325,000, a third at $330,000, a fourth at $400,000 and a fifth at $1.2 million.  The average sale price would be $511,000, a huge increase over the previous year when all the sales were under $400,000. The median sale price would be $330,000, because half the sales were under that price and half were over.

Now let’s look at “Days on Market.” Let’s say those five homes took 1, 2, 5, 7, and 150 days to go under contract. The average days on market would have been 33, while the median would have been only 5 days. Which is more useful?

These two hypothetical scenarios are precisely what we’re seeing in the real estate market. Luxury homes are selling much more quickly than they have in years past,  inflating the average sales price, whereas the median sales price by definition discards both the lowest and highest data points, providing a more accurate picture of what’s happening in the market.

Average_vs_median_DOM    At right is a chart comparing 2017 average days on market to median days on market.   Homes that take a long time to sell — particularly in the current market — are almost invariably overpriced.  The amount of time these homes languish on the market artificially increases the average days on market.  The median days on market is a much better reflection of the market.

Despite this, we continue to hear statisticians and market analysts tell us the changes in the average sale price or the average days on market instead of giving us the more meaningful median statistics.

It’s Thanksgiving, and I’m Thankful for Many Things and Many People

Real_Estate_Today_bylineThanksgiving is my favorite holiday – a non-denominational opportunity to reflect on the past year and our current situation.

I subscribe to the teaching that what we dwell on affects what we draw to ourselves. For example, if we think we might fail at a task, we are more likely to fail, but if we think we’ll succeed, we’re more likely to succeed. Some people refer to this as the “law of attraction.”

That’s why I like Thanksgiving, because it causes me to dwell on what I’m thankful for – not my regrets, not my failures, not what went wrong, but what went right and the good people in my life.

Well, I have a lot to be thankful for!

First of all, I’m thankful to be married to Rita, who always thinks positively and now shares her positive energy with me and the broker associates at Golden Real Estate as our office manager.  Her positive orientation is evident in our house, where she has such phrases as “How Does It Get Any Better Than This?” and “What Else is Possible?” printed on our family room wall.  How did I get so lucky as to attract this woman into my life?  I’m forever grateful for that!

Rita and I have no children together, but we have three “adopted daughters” — three women who consider us “Mama Ri” and “Papa Jim.”  Thank you, Kristin in Kansas City, Ashley in Centennial, and Benedikte in Seattle, for honoring us with your love.

Secondly, I’m thankful for our great broker associates at Golden Real Estate.  In order of seniority, they are:

JimSwansonJim Swanson, who worked beside me at Coldwell Banker and RE/Max Alliance before joining Golden Real Estate when Rita and I founded it in 2007.  He’s our native Goldenite, living ½ mile from our office.

 

web_smallCarrie Lovingier lived in Golden when she joined us as Carrie Ackley soon after our founding. She married a high school sweetheart, Brady, and lives with him and his sons in Evergreen now – she’s our foothills anchor.

 

Cropped 2016 pictureKristi Brunel is from Wisconsin but met her soul mate, Kenny, on the ski slopes of Colorado, marrying into that legendary “old Golden” family. Kristi and I met through Leadership Golden, and I was honored that she wanted to begin her real estate career with us.  As an owner, along with Kenny and her father-in-law, of numerous rentals, she’s a resource to me and her clients as an expert in buying investment properties.

Leo Swoyer came to us as a new Realtor after a long career as a licensed Leo_Face_Shot_with_Glasses_-_04-17-2016_1668_1_25appraiser specializing in mountain properties. His expertise in valuing properties and his knowledge of mountain properties has benefited us on many occasions.

 

photoChuck Brown was an independent broker with Metro Brokers in Denver, but he lives on Lookout Mountain, so he was attracted to joining Golden Real Estate as a broker associate. He is our Denver specialist and continues to list many Denver homes and serve Denver buyers as well as here in Jeffco.

David's head shots 003David Dlugasch was broker/owner of his own real estate company in Crested Butte, but chose to join Golden Real Estate when he moved to Arvada to be closer to his daughter’s family in the Village of Five Parks. He says that reading my newspaper columns was a factor is deciding to join us. Thanks for the compliment, David!

Susan DixonI met Susan Dixon at the Colorado Environment Film Festival. Her commitment to sustainability drew her to leave her previous brokerage and join Golden Real Estate. She lives in Arvada.

 

Andrew LeskoAndrew Lesko transferred to Golden Real Estate so he could specialize in Golden area condos and townhomes. We were so impressed by his research on this topic and his creation of www.GoldenTownhomes.com that it was a no-brainer to welcome him into our fold!

 

NormKowitzNorm Kowitz serves with Kristi Brunel on the board of directors of the Christian Action Guild, and I met him when he represented a buyer for one of my listings. He, too, was attracted by this newspaper column and before long he became a great copy editor for me. Thanks, Norm, for joining us!

 

These broker associates provide a depth and breadth of expertise, but they all share a commitment to our values of integrity, service and sustainability, and I couldn’t be prouder to be associated with them.

Next, I am thankful for you, our readers, who turn to us every week for advice, which we are happy to provide, whether or not you hire us for the sale and/or purchase of real estate.  Thank you for your confidence in us.

Realtor pinNext, I’m thankful for the National Association of Realtors and our local association, the Denver Metro Association of Realtors. Not all licensed agents choose to join NAR and DMAR, but they all benefit from these organizations’ work to protect home ownership and our industry. I’m proud to say that Golden Real Estate is a Realtor brokerage, and all our agents are Realtors.

I’m also thankful for our local MLS and its CEO, Kirby Slunaker, who has shepherded the organization to a level of service and effectiveness which I couldn’t have imagined just five years ago. Our MLS has a great website, and now we are about to merge with the northern Colorado MLS, called IRES, to create an even stronger and better MLS. I’m proud to serve on the Rules & Regulations Committee of REcolorado.

Regular readers know of my commitment not just to sustainability but also to the adoption of electric vehicles.  I am so thankful that EVs are going mainstream and that multiple countries (France, China, Norway and the UK, among others) are speeding the end of internal combustion-powered automobiles. I predicted this revolution a couple years ago, but this year’s developments in that regard surprised even me.

Rotary Club of Golden LogoWe should all be thankful for the various service organizations which contribute so much to society— Rotary, Lions, Sertoma, Optimists, Kiwanis, and others. Rotary, for example, is singularly responsible for the eradication of polio. The Lions Clubs, inspired in 1925 by Helen Keller, have worked on projects to prevent blindness, restore eyesight and improve eye care for millions of people worldwide. The Optimists are all about serving youth. Here in Golden, they have a “bicycle recycle” program that has provided free or inexpensive bicycles to those who couldn’t afford them. Sertoma (short for “Service to Mankind”) is devoted to serving those at risk of hearing loss.

logo100Service clubs in America are in decline, although I’m pleased to report that both the Golden Rotary Club and Golden Lions Club are experiencing a surge in membership this year. (Rita and I are Rotarians, and I’m a Lion.) If voluntarism is in your heart, I urge you to check into one of these clubs in your community, all of which welcome you as their guest at one of their meetings.

I don’t have room to mention all of the organizations or people for whom I am thankful, but let me mention one more — our local chambers of commerce. Golden Real Estate is pleased to be a member of the West Chamber serving Jefferson County and the Golden Chamber of Commerce, on whose board of chamberlogodirectors I serve. These organizations play an important role is promoting a healthy business environment in the communities they serve. Legislators benefit from their advice and feedback regarding bills affecting business. All businesses should consider joining their local chamber and participate in their events.

8WWLogo copyLastly, on a personal note, Rita and I are eternally thankful to have connected with Body in Balance Wellness Center, where our health and fitness benefited from their “8 Weeks to Wellness” program — a real life changer!

As We Learn How Fragile the Electric Grid Is, ‘Off-Grid’ Gains Increased Appeal

Real_Estate_Today_bylineNews from our hurricane-ravaged states and from the Caribbean islands can be unsettling, even to those whose life and property weren’t affected by these events. How would life be for you if you lost electricity for several weeks, or even months?

Without electricity, there is no refrigeration, and you can’t even run a gas furnace to keep warm. If you live on well water, you couldn’t run the electric well pump, so without a manual pump (which are still available) you’d be without water. Forget the internet and charging your cell phone. Gas stations wouldn’t be able to pump gas, so you’d soon lose the use of your car or at, best, find long gas lines — unless you have an electric car powered by off-grid electricity.

Even before the devastating news from Puerto Rico, I’d been considering going off-grid in my Golden home, or at least buying a Tesla Powerwall battery pack as back-up to the electricity supplied by Xcel Energy. I have enough solar panels to power my home and my cars, but when the grid goes down, my solar panels are useless. With today’s solar power systems, you’re either on-grid or off-grid. I used to like to say that the grid is my battery. Now I’m not so confident of that.  My home sends power to Xcel during the day then receives if from Xcel at night.  As long as this  give-and-take arrangement (called “net metering”) works as designed, it makes no sense to own your own battery.   But what about when it doesn’t work?

A friend and mentor of mine, Steve Stevens, has a home powered by Xcel, but also keeps a fully-charged battery pack in his garage so when there’s a black-out he can throw a switch and run his home (and charge his cars) directly from the battery pack.  His solar photovoltaic (PV) system will continue charging the battery pack during daylight hours, which is capable of providing enough electricity to live normally during the night.

I used to think such an investment was silly, but so, it could be argued, is flood insurance — that is, until you have a flood. I’m not considering flood insurance, but I am seriously considering buying “electricity insurance” in the form of a battery back-up system for my home and possibly for my real estate office.

Even a one-day power outage could spoil food in the refrigerator and freezer. Perhaps you’ve had that experience. Such a system would help to mitigate that risk.

Maybe you read, as I did, that Tesla has suspended the production of its new Tesla Semi so it can concentrate on making Powerwall units for Puerto Rico and other areas devastated by hurricanes. Presumably, Tesla is also sending the solar panels necessary to charge those battery packs.

It’s also possible to get off the natural gas grid and heat your home with electricity.   If you’re skeptical, it’s probably because when you think of electric heat, electric baseboard or “resistance heating” comes to mind.

Resistance heating involves the use of electric coils which get hot when connected to electricity. You’ll find this same level of technology in the toaster sitting on your kitchen counter – an appliance invented in 1893.  Modern electric heating, on the other hand, is accomplished by way of a heat pump.  These devices use an electric compressor to extract heat from inside your house when it’s hot (we call that “air conditioning”) and extract heat from outdoors, even when it’s below freezing, to heat your home in the winter.

This kind of heat pump is called an “air source” heat pump because it extracts heat from the outdoor air. A more expensive but more efficient heat pump extracts heat from the earth, which is a constant 55 degrees once you reach six feet below the surface in our latitude.  It takes less electricity to extract heat from that 55-degree source than it does from the air, because the air can get much colder. Unfortunately, the cost of installing the vertical or horizontal wells required for a ground-source heat pump makes these systems much more expensive to install, though cheaper to operate.

mini-split_12,000_BTU_Klimaire_16_SEER_$645Recently I wrote about “mini-splits,” which are air source heat pumps common throughout Europe and Asia but which are just beginning to make their appearance in America. They will ultimately make our gas forced air furnaces and A/C units obsolete. They haven’t been popular here because, without using ducts, you’d require one for each room. At right is a 12,000 BTU kit that I found online for only $645. There are systems currently available that include up to four interior wall units (at the top in the image) that run off a single compressor (bottom left in the image) for under $2,000. They both heat and cool, eliminating the need for a gas furnace plus separate A/C compressor and chiller unit.

Rheem heat pump water heaterDomestic hot water can also be heated electrically using a heat pump water heater. Home Depot sells a 50-gallon Rheem model (left) for $1,199 and claims “$4,000 in energy cost savings.” It’s important to put this model in unconditioned space — or in a room with outdoor air available. The reason is that the heat pump is transferring the heat from the room into the water, so it functions like an air conditioner for the room in which it is installed. If it’s in a small room, that room can get very cold as your water gets hot! If your current furnace room has “combustion air” ducts supplying outdoor air to your gas furnace and hot water heater, those same ducts can provide the needed outdoor air when you convert to heat pumps. Just be sure to keep the door to this room closed — and not have louvered doors.

If you can also do without gas for cooking — and there are some great electric cooktops available now — you can get rid of your gas meter (saving the monthly grid connection fee) and live only off the sun.

When Buying or Selling a Pre-1978 Home, Lead-Based Paint Is a Big Deal

Real_Estate_Today_bylineYou might think that nearly 40 years after lead-based paint was outlawed that it would no longer be an issue, but you’d be wrong.

Over the past decade I have witnessed an increased rather than decreased attention to this issue.  Just read Section 10.10 of the current state-mandated Contract to Buy and Sell Real Estate (emphasis added):

“Unless exempt, if the improvements on the Property include one or more residential dwellings for which a building permit was issued prior to January 1, 1978, this Contract is void un

less (1) a completed Lead-Based Paint Disclosure (Sales) form is signed by Seller, the required real estate licensees and Buyer, and (2) Seller receives the completed and fully executed form prior to the time when this Contract is signed by all parties.”

It’s not uncommon for this requirement to be fudged by the parties and their agents, but doing so can create serious problems.

In order for this rule to be followed, it is critical that the listing agent make available to prospective buyers a lead-based paint disclosure, signed by the seller, prior to them submitting their offer. This can be done by making it a “supplement” to the MLS listin

g. The buyer’s agent must then have their buyer sign that form — and sign it themselves — and submit it with their offer.

Notice that the deadline for all parties signing is not upon submission of the contract, but upon the contract being accepted (signed) by the seller. Therefore, the listing agent should take care to see that all parties have signed the Lead-Based Paint Disclosure before allowing the seller to go under contract with a buyer.

Not only can the violation of this rule subject the buyer, seller and both agents to a fine of $16,000, it also creates an opportunity for a seller to get out of a buyer’s contract, which is otherwise very difficult for sellers to do.

Imagine, for example, a scenario in which a seller who is already under contract to sell his home receives a much better back-up offer. If it can be shown that the current contract was fully executed before the Lead-Based Paint Disclosure was signed by both parties and their agents, it is conceivable that the listing agent could cite Sec. 10.10 of the contract and declare the contract void for that reason alone, allowing the seller to accept the better offer.

The buyer would have no recourse, because, for starters, he would be admitting that the disclosure had not been signed on time, resulting in that $16,000 fine.