Support Habitat for Humanity — Buy a Pumpkin

    Golden Real Estate is happy once again to support the pumpkin patches at Garrison & Alameda in Lakewood and at 78th Avenue & Wadsworth in Arvada. Operated each year by Jeffco Interfaith Partners, a coalition of a dozen local faith groups, the profits from these two volunteer-manned patches have funded 15+ Habitat for Humanity homes over the past two decades. The pumpkins are grown on a Navajo reservation in the Four Corners area, so the sales also benefit that community.

    Yes, the pumpkins sold at our two patches may be more expensive than at your local supermarket, but you have the satisfaction of making a difference with every purchase, and 40% of your purchase is tax-deductible. Our thanks go out to Mile Hi Church and to Trinity Presbyterian Church for providing these two great venues each October.

Report Names 7 Cities Most at Risk of a Housing Crash. Denver Isn’t One of Them

With the crazy seller’s market we’re experiencing now, it’s common for people to ask whether we’re in a “bubble” which could burst at any time.

Well, last Wednesday UBS Group released its annual Real Estate Bubble Index, and while it listed three U.S. cities (San Francisco, Los Angeles and New York) as “overvalued,” none of the seven cities listed as “bubble risks” were in the U.S.

Those seven cities with the highest “bubble risk” included Toronto (#3) and Hong Kong (#4), but the rest were all in Europe — Munich (#1), Frankfurt (#2), Paris (#5), Amsterdam (#6), and Zurich (#7).

Boston squeaked into the “Fair Valued” category, and Chicago narrowly made it into the “Undervalued” category.

I was surprised at this analysis until I read the UBS report myself instead of just the coverage of it on a real estate news service to which I subscribe.

The answer as to why more American cities weren’t on the list turns out to be very simple — UBS Group only studies “25 major cities around the world,” and the U.S. cities I mentioned above are the only U.S. cities analyzed each year in the report!  Twelve of the 25 cities studied for this report are in Europe, with the rest divided between North America, the Middle East and Asia/Australia.  It should be noted that the UBS Group office which creates the report is based in Switzerland, so it’s rather Euro-centric.

Click here to view the full UBS Group Global Real Estate Bubble Index.

Despite the limited number of U.S. cities included in the UBS report, there are some useful observations about our market, such as this one:

“Overall, the drop of mortgage rates to historically low levels supports house prices in the U.S. But price changes in the analyzed cities trail the nationwide average. Inner-city demand growth has slowed down as citizens move out to the suburbs as a result of affordability issues and the impacts of COVID-19. Continued migration to lower-cost and more tax-, business-, and regulatory-friendly states has accelerated this trend.”

Claudio Saputelli, Head of Real Estate at UBS Global Wealth Management’s Chief Investment Office, added the following: “The rise of the home office calls into question the need to live close to city centers. Pressure on household incomes cause many people to move to more affordable suburban areas. Moreover, already debt-ridden or economically weaker cities will have to respond to this economic crisis with tax increases or public spending cuts, neither of which bode well for property prices. Taken together, these factors amplify some longer-term uncertainties surrounding urban housing demand.”

Doing my own statistical analysis on REcolorado, Denver’s MLS, I see the trend described above.  While the number of active (i.e., not yet sold) listings and days on market are at nearly   all-time lows in Jefferson County, they are near all-time highs in the Lodo/Downtown Denver market. This is not a good time to sell a condo in any city center (except small cities like Golden), but it is certainly a good time to sell a single-family home (or a condo) in Jefferson County, as I have reported in previous columns.

The last time Realtor Magazine even dealt with the question of a real estate bubble was in November 2018.  The consensus of real estate economists is that our country is not in a real estate bubble, but it’s hard not to worry about it as one looks at the recently increased rate of appreciation in home prices.

With no end in sight to the low mortgage interest rates and with the rich getting richer under the Trump tax cuts, it’s understandable that the real estate market is performing as it is, but such appreciation cannot be sustained long-term.

Only time will tell, and our crystal balls will at least clear up a little after the current election season ends. A Biden victory is sure to bring rollbacks of the Trump tax cuts which benefited the rich (defined as those having taxable incomes over $400,000 per year) and the super rich, which will reduce some of the upward pressure on home prices, but those rollbacks are critical to address the widening wealth gap in America and the exploding national deficit — something that used to be an important issue among Republicans!

If You Missed Last Saturday’s EV Roundup and Green Homes Tour…

You can view a short video report about last Saturday’s Electric Vehicle Roundup at Golden Real Estate on my YouTube channel. The shortcut for accessing my YouTube channel is www.JimSmithVideos.com.

And you can still tour the homes on the 26th annual Metro Denver Green Homes Tour by clicking on “Playlists” on the same YouTube channel.

Price Reductions on 2 Previously Featured Listings

David Dlugasch’s fabulous townhome listing at 707 20th Street, within walking distance of downtown Golden and the Colorado School of Mines, originally listed at $787,000 is now reduced to $750,000. It has 3 bedrooms and 3½ baths on three levels. It is the end unit, overlooking Kinney Run, a wooded year-round stream giving you the feeling of being in the woods, not close to downtown! Take a video tour at www.GoldenTownhome.com, then call your agent or David Dlugasch at 303-908-4835 for a private showing. Or attend the open house Saturday, Oct. 10th, noon to 3 p.m.

The listing price on 12181 Crane Lane in Austin CO has been reduced by $31,000 to $429,000, below the previously appraised value! Escape to the Western Slope at this secluded country location minutes away from city conveniences. Come home to this energy efficient custom straw bale house on 9.96 acres with irrigation water for your hobby farm, a 3-car/2-story external shop for your toys, and a 2-car attached garage. Go to www.OrchardCityHome.info or call Kim Taylor at 303-304-6678 to learn more about this great home at a great price!

Sustainability, Starting With Solar Power, Can Be Your Key to a More Affordable Lifestyle

The first Saturday of October is when the Metro Denver Green Homes Tour happens, and this year the tour is better than ever because it’s virtual. What that means is that instead of having to visit some or all of the homes between 9 am and 4 pm on a single day, you can watch short videos of each home. It’s possible you could “visit” all 16 homes and the one business in just one or two sittings at your computer and likely learn more about their sustainable features than if you had visited them in person. That’s what I call a green tour of green homes!

Since I shot all those videos myself and thereby learned all those homes’ sustainable features, you can consider me an expert on what’s new and exciting as well as what’s old and proven when it comes to making a home sustainable.

The theme this year is the Best Homes From the Last 25 Annual Tours. The home owned by Rita and me is on the tour, and since I just turned 73 I’d like to share with you how making our home sustainable also secured for us an affordable retirement — if and when I retire!

It all starts with solar power. Nowadays you can install enough solar panels on your home for under $20,000 so that you never pay Xcel or your other electrical provider more than the cost of being connected to their electrical grid. With Xcel Energy, that’s under $10 per month. The electricity you use is free, created from the sun.

You need to be connected to the grid, because the grid functions as your “battery.”  Your electric meter runs backward during the day when you’re creating more electricity than you use, and it runs forward at night. Your goal is to have it run backward more than it runs forward.

Plan ahead and buy enough electrical panels so that over time you can replace your  gas-fired appliances with electrical ones — a heat-pump water heater, a  heat-pump system for heating and cooling, and an electric range — and replace your gas-powered car with an electric one. Now everything in your life is sun-powered!

You can buy a used electric car for under $30,000 or even under $10,000 (Google “used electric cars” and see for yourself) and never buy gasoline or pay for an oil change or tune-up again and probably never have an expensive car repair either. Buying a used electric car is smarter than buying a new one because there’s hardly anything to go wrong with an EV — no transmission, timing belt, motor or hundreds of other expensive parts that could fail. See the article at right about our electric vehicle event. It’s the only in-person part of the tour.

So there you have it. Once you’ve paid off your mortgage (or transitioned to a reverse mortgage), the only costs of living in your home will be your property taxes and water bill, plus $10 per month for being on the electrical grid.

Be sure to “attend” this year’s tour of green homes. Register at www.NewEnergyColorado.com/home-tour. It’s free, although you will be asked for a donation. Another feature of the tour this year is three video presentations.

Hear Bill Lucas-Brown from GB3 Energy on “Reducing your Carbon Footprint with an Electric Mini Split”; John Avenson, from PHIUS.org and Steve Nixon from the National Renewable Energy Laboratory discussing “New Home vs Renovation: 2 alter-native Paths to Zero Energy”; and Peter Ewers from Ewers Architecture Golden presenting “All Electric Buildings, the Key to our Energy Future.”

Below are twelve of the videos in the YouTube playlist which you’ll get to view when you register for this year’s tour.

Find Out This Saturday Whether an Electric Vehicle Is Right for You

For the 7th consecutive year, Golden Real Estate is pleased to host an Electric Vehicle Round-up in our parking lot at 17695 S. Golden Road this Saturday, Oct. 3rd, from 2 to 5 pm. It’s part of the National Drive Electric Week in addition to being the only in-person component of the Metro Denver Green Homes Tour.

Over 20 owners of EVs have registered at www.DriveElectricWeek.info to bring over 10 different models of EVs and answer the questions of people who may be considering the purchase of an electric vehicle.

EVs already registered include 3  Tesla models, 3 Chevy models, an Audi e-Tron, both Nissan Leaf models, a Fiat 500e, and the Hyundai Kona. I expect others to register, too.

In addition, we expect to have some electric bicycles and a unique electric tricycle, which you’ll be able to test drive. I’ll bring my 2012 Chevy Volt (242 lifetime MPG), which Rita and I have decided to sell for $7,500.  (It cost $40,000 in 2012, and runs as well as new.)

We’ll observe state rules regarding COVID-19, taking the temperature of all visitors on arrival and requiring masks, which we’ll provide if necessary. Everyone will get a shot of hand sanitizer, and we will get contact info of all attendees solely for the purpose of contact tracing (another requirement for such events).

If you drive a car for business, you really need to look into buying an electric vehicle. Why? Because the only cost of driving an EV is 3 cents per mile for electricity (unless you get it free from the sun, as we do) and the wear on your tires, yet the IRS is happy to give you the same 57.5 cents per mile deduction when you use your car for business.

A previous Electric Vehicle roundup event at Golden Real Estate.

Price Reduced on 3-Bedroom Golden Townhome

416 Gladiola Street – Now priced at $344,000

Originally priced at $350,000, this 3-bedroom, 3-bath townhome is now priced at $344,000. It has many virtues, including the best mountain view in the subdivision. With its low turnover, you can tell people are happy living here, and it’s super convenient. Colorado Mills, a medical center, a community swimming pool and tennis court, Kyffin Elementary School, Red Rocks Community College and light rail are all close by. These townhomes are well built too and suprisingly quiet, given the proximity to I-70 and U.S. 6.  See more pictures and a narrated video tour at www.GladiolaTownhome.info.

Just Listed: Solar-Powered Golden Home Behind Hogback

515 Crawford Street, Golden – Listed at $850,000

Tripp Ranch is a 1990s subdivision located in South Golden between Heritage Dells and Stonebridge at Eagle Ridge. This home is located across from the Kinney Run trail and a short walk from the Apex Open Space trailhead. Shelton Elementary School is just a few blocks south. US Highway 6 and Interstate 70 are less than two miles away, providing convenient access to Denver, Boulder and the mountains. Inside, this home has some great improvements, including hardwood floors, a gourmet kitchen with slab granite countertops, and two offices. The backyard features a large deck with included hot tub. Best of all it’s super quiet here because of its setting behind a hogback. Homes here sell quickly, so check out the narrated video tour online at www.TrippRanchHome.info, then come to the open house this Sunday, October 4th, 11 a.m. to 2 p.m.  Or call your agent or Jim Smith at 303-525-1851 for a private showing.

Just Listed: 5-Bedroom Northeast Arvada Ranch

5362 W. 83rd Ave., Arvada – Listed at $400,000

This ranch home has 5 bedrooms and 3 bathrooms. It is located between Denver and Boulder with easy access to mass transit. The basement is finished with a 37’x13’ carpeted room to use as you wish plus two bedrooms (non-conforming), a three-quarter bathroom and laundry room. On the main floor, the living room and three bedrooms are carpeted with hardwood floors underneath. The eat-in kitchen opens to a large deck and park-like backyard. The wood deck is 36’x19’ and is a great place to entertain. There is an oversized one-car garage and outside space for a camper, RV or another car. Take a narrated video tour at www.ArvadaRanch.info, then call your agent or David Dlugasch at 303-908-4835 for a private showing.  Open this Saturday, October 3rd, 11am to 2pm.

Experts Are Predicting a Surge in Foreclosures, But I See the Situation Differently

With the continued high unemployment rate and the expiration of Pandemic Unemployment Assistance (PUA), many homeowners are hurting, so it makes sense that we may have a foreclosure crisis in our future.

CoreLogic reported recently that back in June (when the Feds were still sending $600/week in PUA to Americans) the share of mortgages with payments 90 to 119 days late had already risen to 2.3%, “the highest level in 21 years.” A rate that high could result in a foreclosure crisis, the report said. Not only could millions of families potentially lose their home, but that would also create downward pressure on home prices.

But I see the situation differently, and after consulting with Jaxzann Riggs of The Mortgage Network, here’s why I don’t expect that flood of foreclosures.

First of all, foreclosure should only happen when a seller owes more on their home than it is worth. That’s because sellers lose all their accumulated equity in a foreclosure, and most people have accumulated a lot of equity thanks for the sellers’ market we have been experiencing.

Secondly, federally mandated forbearance is in effect, which is unlike the forbearance which delinquent borrowers may have enjoyed in the past. Under the current plan, lenders add extra payments at the end of the loan instead of requiring any kind of catch-up payments. This mandate could be extended, too.

The only people likely to face foreclosure will be those who recently took out 100% VA loans or 96.5% FHA loans or conventional loans with only 3% down payment, and for whom there is hardly any equity to lose in a foreclosure action.

Being on forbearance doesn’t affect one’s credit rating even though you are not making payments (again, part of the federal mandate), but once you resume payments, you need to make a minimum of three on-time payments to qualify for a Fannie Mae or Freddie Mac loan, which will restrict your ability to sell your home and purchase a replacement home. Some lenders require six months post-forbearance loan payments.

That, too, will slow down any surge in what are known as “distressed listings.”