Denver Real Estate Podcast with The Dixon Group

There are some significant benefits to buying a home over renting one. Here are the three biggest ones. If you’re deciding whether you should buy or rent a home, there are a few things you need to know. First, if you rent for 10, 20, or even 30 years, you’ll end up throwing away a ton of money that you could have invested in a home purchase instead. Second, the government rewards homeowners by giving tax write-offs. Finally, owning a home allows you to build equity by paying down your mortgage and you can turn that equity into cash later on. Renting doesn’t give you that opportunity. Please feel free to reach out via phone or email if you’re seeking a more in-depth conversation on this topic. We’d love to hear from you.

As you might already know, inventory for homes priced under $500,000 is tight. When these homes come on the market, they’re likely to receive multiple offers. If you’re looking to buy a home in Denver, there are a few strategies that will help you win in a multiple offer situation. Be first in line. Being the person with the first offer presented to the seller is important. For some reason, sellers always love the first offer on their home. Sometimes a seller will choose your offer over one that’s identical just because you were first in line. Agree to buy the home as-is and to only negotiate major health and safety items. This lets the seller know you won’t nickel and dime them after the inspection. You’ll still have an inspection, and if you find anything wrong, you still have the opportunity to terminate the deal or ask the seller to fix some of the deficiencies with the home. It lets the seller know we aren’t going to play games after the inspection and that you’re a serious buyer only concerned with the major health and safety items. Get pre-underwritten by your lender. Getting all your financial documentation to your lender as early as possible lets you present the file to an underwriter who can then approve it only pending an appraisal. This lets you submit your offer to the listing agent with full approval for the home loan. All you need is the appraisal, and then you’ll be ready to close. Be able to offer a quick close. Some of the lenders we work with can close as quickly as 14 days, which helps your offer compete with cash offers. If you’re competing against other financed offers that typically close in 30 to 40 days, you can better that time frame by half. An escalation clause. This means your offer automatically escalates by a certain dollar amount to beat out any other buyers up to a certain amount. That way, you won’t lose out on your home over just $5,000.“There are eight ways you can strengthen your offer to beat the competition.” Offer a larger earnest money or escrow deposit.This shows the seller that you’re very willing and able to purchase their home and that you’re willing to put a little more skin in the game. Bring the price difference if the home doesn’t appraise.Homes in a bidding war can get blown up tens of thousands of dollars over the asking price in our market. The seller wants to know that if the home doesn’t appraise, you can and will pay the difference between the appraised value and the actual purchase price. You can put a clause in the contract agreeing to pay a certain amount above the appraised value to let the seller know what their bottom line proceeds will look like before the appraisal even happens. This is a strong tactic, but we try to keep it in our back pocket so we can keep our buyers from overpaying for a home if we can help it. Offer a post-occupancy agreement (or seller leaseback) to the seller. You would close on the home and become the new owner, but agree to lease the home back to the seller for 15 to 30 days after closing to let the seller rest easy knowing they’ll have enough time to find their next home and move out in time for you to take possession. This comes with risks and challenges, but it can really help you win the home you want. If you have any other questions about winning the home you want in our market, don’t hesitate to give me a call or send me an email. I’d love to help you!

Home remodeling is hotter than ever. According to researchers at Harvard University, remodeling investment is up 6% over last year, and now makes up a $324 billion market. According to a survey of remodelers and real estate professionals, there are five remodeling projects that offer the best returns: 1. Your kitchen. Kitchen remodeling can be as simple or as elaborate as you like. However, to maximize your return, keep your investment to under 20% of the value of your home—as is recommended by surveyed real estate professionals. The outcome? A whopping 85% return on your investment. 2. Your bathroom. A thorough bath remodeling project can cost up to $20,000. However, not only will it pay for itself, it should give you an added 80% return. 3. Your deck.Replacing your deck can cost you anywhere from a few thousand dollars to tens of thousands of dollars, depending on the size. The expected benefit will be similar to a bathroom remodeling project—around an 80% return for a fresh, new deck. “Some will make more sense for your home than others.” 4. Your siding. Fading or worn-out siding can turn off potential buyers before they even step foot in your home. Replacing old siding will make it much easier to sell your home, and in addition, it should give you an 80% return on an investment of around $10,000. 5. Your windows. New windows can mean greater energy efficiency, increased thermal and acoustic comfort, and a more modern look. Homebuyers are well aware of this, and they are willing to pay accordingly. That’s why a typical window replacement should yield at least a 70% return on your investment. Clearly, some of them will make more sense for your home than others. If you’re considering selling your home, then just one of these projects could add tens of thousands of dollars to the price you’ll be able to get. If you have any questions or want additional advice about which remodeling projects make sense for you, give me a call or send me an email. We can discuss all the details and I can give you an accurate estimate of what these projects could be worth. I look forward to hearing from you!

Buying your first home can be an incredibly exciting time. However, it requires a huge commitment and a sizable investment. That’s why I want to share my three top tips to help first-time homebuyers protect themselves during this crucial period: 1. Know what you can afford Your mortgage is only a part of what you will need to pay when you buy a home. Homeownership comes with plenty of other expenses, including closing costs, taxes, property insurance, maintenance costs, and homeowner association fees. Once you have a clear idea of how much all of these items will cost, you can compare it to your current monthly expenses. Then you can figure out the kind of home you can honestly afford. 2. Choose your lender wisely Choosing a lender is not something you should base only on the lowest rate. A competent and trustworthy lender will offer you advice on how to improve your credit and the right lender will also help you take advantage of special homebuyer programs that might benefit you.But how do you find the right lender specifically for you? It’s often best to get recommendations from friends who have already worked with a lender or from a real estate agent you trust. 3. Don’t overlook the details There are many details that go into buying a home, and missing any of them can be a costly mistake. For example, I always advise my clients to get a professional inspection done on their home, separate from the appraisal. In Colorado, you don’t have to be a licensed inspector to do an inspection, so we give out a vendor list that has licensed professionals who we trust and work with. An inspection will set you back about $300, but it can save you thousands of dollars down the line, and it can prevent you from making a decision to buy a home that you would later regret. “An inspection will cost about $300, but it can save you thousands.” A second example is understanding the fine print in the various contracts you will be signing. If there’s anything that isn’t clear to you, talk to your real estate agent and have it spelled out. There’s no such thing as a dumb question. The process of buying a home can be intimidating, and that’s why professional real estate agents are there to help. These three quick tips are only the start of the things you need to watch out for when buying your first home. If you’re interested in checking out homes in the Denver area or you need more advice, get in touch with us by phone or email today. We look forward to hearing from you soon.

The latest news from our Denver real estate market is in, so it’s time for a spring market update. Spring is typically the hottest time of year to list your home. However, there are three key reasons why the 2018 spring market here in Denver is going to be particularly exceptional. Demand is outpacing supply. Right now, housing inventory is near an all-time low for our area. We’re down by almost 10% year over year as far as listing inventory goes, and our population continues to rise. This rise in population is mostly driven by great local job outlook and a high number of millennial entering our market.“Right now is certainly a good time to earn top dollar for your home.” Home prices are still surging.Because we have such high demand and such low inventory, we’re still looking at double-digit growth year over year in terms of list price, which is now over $500,000 on average. Also, our homes are still growing in value by nearly 1% month over month. It’s hard to say how long this trend will continue, but right now is certainly a good time to earn top dollar for your home. Mortgage rates are continuing to climb. The average rate right now is around 4.5%. Historically speaking, this is still really good. However, if rates continue to climb, homeownership will become increasingly expensive. This could deter a number of buyers from entering our market. If you have any other questions, would like more information, or want to find out how my team and I can help you take advantage of our current market, feel free to give me a call or send me an email. I look forward to hearing from you soon.

I’ve been getting a lot of questions about appraisals today, so I wanted to drop by and answer a few of the most common ones. Appraisals are important to many different parties. For lenders, appraisals let them know how much they can lend on a home. For buyers, it lets them know they aren’t overpaying for a home. Here are a few of the most common appraisal questions we get and our answers to them:1. How does the appraisal process work? After you go under contract, you’ll order an appraisal. This will likely be handled by your lender, who will hire a third-party company to come in and get the appraisal done before the deadline on the contract. For sellers, there’s not much you have to do for an appraisal. The main thing to keep in mind is that the price of the home needs to agree with what the appraiser sees. This can be a little difficult to do. “Appraisals are important for buyers and sellers.” 2. How does the appraisal affect a buyer? For one, a lender won’t lend on a property that is priced higher than its appraised value. If the appraisal comes in at value or even a little over what you paid, we’re perfectly fine and can proceed to closing. If it comes in under value, this is where I come in to negotiate on your behalf to help get that price down. 3. How does the appraisal affect a seller? It only affects sellers if the appraisal comes in low. If that happens, you’ll have to either reduce your price or risk letting the deal fall apart. It’s my job to make sure you’re priced right in the first place so you won’t run into any of these issues. If you have any questions for us about the appraisal process or anything related to real estate, give me a call or send me an email. I look forward to hearing from you soon.

February is the month of love, so with Valentine’s Day approaching, we thought this would be a wonderful opportunity to thank all of our clients. Without you, our business wouldn’t exist. We appreciate the trust and confidence you put in us to solve all of your real estate needs. We firmly believe that we will all benefit immensely from an attitude of gratitude, and our hearts are full of gratitude for you. Thank you all so much, we appreciate you. We hope to speak to you sometime in the future. Happy Valentine’s Day! If you ever have any real estate questions, please don’t hesitate to reach out to us. We would love to help. 

I’ve got some very exciting news to share with you. Our team just partnered with a hedge fund that is purchasing homes in our market for cash and then renting them out to tenants with a rent-to-own option. This is a game-changing program for anybody who has the dream of homeownership but isn’t quite able to buy right now for whatever reason. This program will allow you to achieve your ownership dream. “This is a game-changing program for anybody who wants to buy a home but isn’t able to right now.”

Today, I’d like to discuss five home upgrades that, despite common belief, won’t add any value to your home. Adding a pool. Pools can be hit or miss when it comes to adding value. If you’re able to use your pool year round, you’re more likely to get a favorable response from buyers. Here in Colorado, however, we’re only able to use the pool a few months out of the year. Buyers will think twice about the maintenance and upkeep it will require to maintain a pool. Highly custom designs. Unless you plan to stay in your home for many years to come, think carefully about renovations that are too personalized. The features might end up costing you more in the end, and when you go to sell, buyers may be turned off by the designs, which in turn won’t get you the offer that you desire. Room conversions. Buyers look to check certain boxes when they tour your home. For example, they might want three bedrooms, two baths, and a garage—getting rid of these expected spaces or altering them into something unusual may harm your resale value. Bedrooms are coveted spaces that can bump your listing up into the next bracket.“Buyers will think twice about the maintenance and upkeep it will require to maintain a pool.” Incremental square footage gains.Sizeable square footage gains like finishing a dingy basement so it becomes an additional, liveable floor can be a huge plus in buyers’ minds. But, tiny, insignificant changes may not give you much of a return on your investment. You may love your new sunroom, but it’s not likely to drastically increase your home’s overall value. Adding square footage that doesn’t flow well with the floor plan can also backfire. Over-improving.When your upgrades seem like overkill for your neighborhood, you alienate buyers on two fronts. Buyers who are drawn to your neighborhood won’t be able to afford your home, and buyers who can afford a home of your caliber will prefer to be in a ritzier area. Before you make any decisions about making upgrades like this, please contact a professional like me first. I’d be happy to steer you in a direction that makes your home more valuable to you and potential buyers.

A couple of questions I get asked a lot from the buyers my team and I work with are “Do you have experience with down payment assistance?” and “Is it true you can really purchase a home with little-to-no money out of pocket?” The answer to both is absolutely yes! There are two different types of down payment assistance products offered to buyers here in Denver.The first is a down payment grant that you never have to repay, which is definitely my favorite. The second is a mortgage known as a “silent second.”With the silent second product, the down payment assistance company gives you the money for your down payment, you never need to make monthly payments on it, and it’s on title as a second mortgage. When you sell the home in the future, though, you’ll need to pay off that amount. Not all lenders have access to these down payment assistance programs, so make sure you work with someone you trust and has access to all the different options we have in Denver. “One of our buyers recently bought a $302,000 home with just $1,500 out of pocket.” When you’re working with a down payment assistance product, you’ll typically need 45 to 50 days to close because you have two sets of underwriting to go through. You have to first get underwritten from your local lender and then get underwritten from your down payment assistance company prior to getting clear to close. How well do these programs work? One of our buyers recently bought a $302,000 house with only $1,500 out of pocket. These kinds of programs are real—you just need to work with a professional who knows how to get to them and how to leverage them to help you compete in a multiple offer situation. If you or anyone you know is looking to purchase a home with little-to-no money out of pocket, please reach out to us so we can evaluate your situation and help you make the best decision possible. We look forward to hearing from you.

Today I have some exciting news to announce. This marks the launch of my new video blog dedicated to sharing my real estate expertise with you. Each month I will send out two videos addressing specific topics in our real estate world. I’ll also address changes in the lending and title world and provide tips on how to navigate through them. All of these industries are intertwined, so to take full advantage of the real estate market, you need to know how to maneuver through each one of them. “What are you curious about when it comes to real estate?” Rather than simply guessing what’s on your mind, I want to reach out to you and ask what questions you have about real estate. Are there specific concepts you want to know more about? Are you curious about a specific market or neighborhood trends in your area? I would love to answer your questions in my videos so others can benefit from them as well.If you’re thinking about buying or selling a home, please reach out to us so we can schedule a free consultation. We look forward to hearing from you!

This winter is likely to be a very important moment for many home sellers. That’s because three big trends are coming together to affect Lancaster County home prices right now: 1. Housing inventory remains extremely tight. The total number of homes on the market fell 10% year over year in the last quarter. This is the biggest drop since 2013, and it’s part of a consistent pattern of very limited and decreasing housing supply. Of course, the fewer homes there are on the market, the easier it is to sell, and the higher the price you can expect to get. Home prices have increased almost 6.5% nationally since last year.2. Buyers are increasingly optimistic. Despite the tight inventory, homebuyers are increasingly optimistic and continue to look for homes. Some of this has to do with the recent growth in income and job stability. Loosening lending standards are also making many homebuyers eager to take advantage of current mortgage rates, which slipped under 4% recently. “It’s the perfect time to get in the real estate market.” 3. The new tax reform bill will impact the market. The federal government recently passed the Tax Cuts and Jobs Act, which majorly overhauled our tax code. While it’s unclear how this will affect the real estate market as a whole, there are some changes that do not favor home sellers.  As a result of the changes made to the tax code, the National Association of Realtors now projects slower growth for home prices in 2018, with an appreciation rate of 1% to 3%. By doubling the standard deduction, Congress has significantly reduced the value of mortgage interest and property deductions as tax incentives for homeownership. On the bright side, no changes were made in the rules surrounding capital gains for home sales, which is good news for home sellers. When you put all three of these trends together, two big conclusions emerge. First, now is a very favorable moment for home sellers, thanks to the shortage in the market, the many eager buyers, and the high and rising prices. On the other hand, higher cost, higher tax areas will likely see prices decline as the result of new restrictions on mortgage interest and state and local taxes. If you are looking to take advantage of the present moment to sell your home, please reach out by giving us a call or sending us an email. We look forward to hearing from you soon.

Here’s why days on market is an important metric when it comes to the real estate market. What does the term “days on market” mean and why is it important for sellers to know? Days on market refers to the time between when a home is listed on the MLS and when it’s sold or taken off the market, it measures how long it takes a home to sell. What’s considered “good” when it comes to days on market? Well, if the average days on market for an area is 29 days, it’s better to sell your home in less time than that. Why do some homes sit longer on the market than others? Some reasons include: Being priced too high Lacking curb appeal The seller refusing to make upgrades to the home or not allowing enough showings There are still renters living inside it Is it possible to beat the average? Yes—by pricing your home 10% to 15% under market value, it will create a multiple-offer situation and expedite the sale. “If the average days on market for an area is 29 days, it’s better to sell your home in less time than that.” There are several things you can do to sell your home as quickly as possible. First, hire a specialized team like the Dixon Group. Also, be smart about the listing price. Like I just said, the best thing you can do when pricing your home is to look at the prices of other homes in the area and set your price 10% to 15% lower. Along with creating a bidding war, you’ll likely receive an offer that’s close to or higher than your list price. Lastly, keep up with current technology. People won’t even look at your home if they’re not intrigued by its online presence. The internet is the driving force behind home sales. If you have questions about this or any other real estate topic, don’t hesitate to reach out to me. I’d love to help you.

Today we’re excited to introduce Heather Sowa, a new team member of ours. She’s now helping us sell homes in our Denver market, so if you have any real estate needs in our local area, in Atlanta, or anywhere in the country, Heather would be more than happy to help make your experience as great as possible.Heather also wants to let you know that now is a great time to buy. Interest rates are going up and so are prices, so act while you can before they do. “Heather would be more than happy to help make your experience as great as possible.” Thankfully, down payment assistance programs can help you get into the home of your dreams for less than expected. Heather would love to go over some of these programs with you, and to also talk about how you could pay less for a mortgage than for rent in our current market. If you have any other questions or would like more information, feel free to give Heather a call or send her an email. She looks forward to hearing from you soon.

If you’ve thought at all about selling your house, there are three recent developments that make this spring a great time to do so. For one, mortgage rates have stabilized. The 30-year fixed mortgage rate spiked after the election at a high of 4.31%, but have since stabilized. Despite the increase, they are still near historic lows. Secondly, jobs are up nationally with an additional 235,000 new jobs in February and 2.3 million added over the past year. This is a good indicator of continued growth of business and consumer confidence. “Housing inventory is at record lows, driving up prices.” Finally, housing inventory is a record low. February marked the 100th consecutive month of year-over-year declines in inventory dating all the way back to October of 2008. All these developments mean that if you’re looking to sell your house in Denver, you’ll be able to do it very quickly. Homes sold in an average of 68 days in February compared to 75 days during February of 2016. You can also expect to sell your home at top price. Strong demand for houses and low supply has caused prices to continue increasing.If you’re curious what your home is worth or you have any other questions about selling your house, don’t hesitate to give us a call or send us an email. We’re happy to help!

What can you expect from the real estate market in 2017? Is Denver in a buyer’s or seller’s market? Right now, Denver is in an extreme seller’s market.Traditionally, inventory is a little light at the beginning of the year. However, there is even less inventory right now than there has been in years past. Since inventory is so low and demand is so high, there is upward pressure on home prices. It all boils down to supply and demand. Since there aren’t many homes on the market and there are many people interested in buying a home, home values are on the rise. Since Donald Trump has become president, interest rates have been steadily increasing.Before the election, the average interest rate was 3.87%. Now, the average interest rate is 4.25%. That alone will make purchasing a home more expensive for buyers. “Interest rates have been steadily increasing.” Rising interest rates and rising home values are putting a lot of upward pressure on affordability. If you are in the market for a home now, there are two things you can bank on: that house will be more expensive next year, and the cost to borrow money will go up. There is no better time to buy a home than right now, before it starts to become too expensive. As for sellers, higher interest rates actually work to your advantage. A lot of buyers are jumping off of the fence and into the market before rates go up again. So, even though we have a shortage of inventory, we are seeing even more interest in the homes already on the market. If you have any other questions about buying or selling a home in our current real estate market, give me a call or send me an email. I would be happy to help you!