Jack O’Connor, Broker/Owner The Denver 100

“We’ve already seen a yearly increase in value of around 4.7% for Denver area single-family homes in a range $250,000 and under,” O’Connor said in releasing the newest edition of his monthly ‘So How’s The Market’ report last week.

That increase, he added, mirrors an exceptionally low inventory of homes available under $250,000.
However, total inventory covering all price ranges in the eight county Denver metropolitan area is also down sharply over the past year, O’Connor noted. As of Feb. 5 that inventory totals 11,409 homes – down more than 41% from early February of 2011. Drops in condominium inventory have been even sharper – down more than 50% over the course of the year.

Meanwhile, the Denver area is experiencing its first January increase since 2006 in numbers of homes-and-condos-sold – up 14.56% year over year. Total homes under contract are also rising – up 5.3% from those under contract in January a year ago. Foreclosure filings have continued to drop.

O’Connor says that inventory will rise this spring – an annual event that may be heightened as sellers perceive the low competitive inventory available. However, with interest rates expected to remain low through the fall election, O’Connor expects absorption to rise, as well. Currently, O’Connor said, absorption for the Denver area’s total combined inventory of homes and condos stands at only 3.42 months’ supply. That anticipates a projected 40,000 homes expected to close in 2012, at current rates.

Six months’ supply is traditionally seen as a dividing point between a seller’s market and a buyer’s market. O’Connor noted that the low inventory seen now is exacerbated by sellers who have been hesitant to market their homes; and that job growth needs to pick up the pace before the market can gain greater momentum.

Absorption, he added, is a highly localized phenomenon and needs to be watched at a neighborhood level.
Nevertheless, O’Connor said, agents are already noting spot shortages in middle price ranges as well as lower. “Area residents have substantial move-up power today,” he added. “This is a time for buyers to prepare for opportunities by getting qualified,” he said. “If you’re a seller, you should be working with an agent to set a price and to get ready for sale.”

O’Connor has authored ‘So How’s the Market?’ for eight years. The Denver 100 is a boutique agency that emphasizes experience and skills of its agents – over 20 years on average — and averages four times more transactions-per-year than the Denver area average. The Denver 100 has offices at 385 Inverness Parkway near Park Meadows Shopping Center. To receive Jack O’Connor’s So How’s The Market? report, call him at 303-880-8561, or visit the web at TheDenver-100.com.
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IF YOU GO

WHAT: “So How’s The Market?” monthly newsletter-report on Denver area residential real estate market, prepared by Jack O’Connor, Broker/Owner of The Denver 100.

PRICE: Free
PHONE: 303-880-8561 WEB: TheDenver-100.com

Anybody who has ever tried to sell a house knows that you’re nuts to try and do it without a real estate agent’s help. But how about if you’re BUYING a house? How about if you already know what you want…have done your own research on neighborhoods…and you know how much you can afford? Do you still need to pay an agent a full buyer’s commission (generally 2.8% of the closing price) to help, if all you really need is somebody to manage the paperwork?

Slice Realty’s Tommy Lorden on Boulder’s Pearl Street Mall. Slice serves the Denver metro area, but can usually assist with a purchase anywhere in Colorado.

Jeremy Long and his wife were exactly those kinds of buyers; he writes computer code for a living and with his skills, would need very little help in any internet search. Using the ‘net, he also found licensed broker Tommy Lorden, founder of Buyer’s Slice Realty, who specializes in what agents consider to be the ‘easy ones’ – buyers that do most of the work for themselves, and are likely to purchase without a lot of unexpected problems.

In return for matching that profile, Long and his wife received a trouble-free closing, and 50% of the 3% buyer commission at closing.
“Three percent is a pretty substantial amount of a $200,000 house,” said Long, who’d been troubled by the idea of paying an agent for a job he knew he’d be doing much of the work on. “Even if (we) did a substantial amount of research, a Realtor would still get a substantial commission.” Long added that if he hadn’t found Lorden, he would have paid an attorney, just to “keep everything kosher.”

Slice Realty was the perfect match (Lorden has been an agent 15 years, but has also practiced as an attorney and prosecutor before moving his family to Colorado in 2006). He had the Longs sign his limited-service buyer-broker agreement (a ‘Right-to-Buy’ agreement) and gave the couple some help in searching, including access to the agents’ MultiList system — up-to-date listings as they come on the market, and information to help evaluate whether a home is worth the price.

“My average buyer gets over $5,700 back,” says Lorden, adding that one received back $9,000 (the determining factors are the sale price, amount of co-op offered, and in some cases some lending stipulations). Rebates are made at closing – in 90% of cases as a credit against the buyer’s bottom-line. In a few cases, a lender may arrange to apply a rebate against financing.

What Lorden WON’T do is pick you up at the airport, or spend days driving you around, or sorting through listings over your coffee table. Buyers who need that extra support get their money’s worth by using regular buyer’s agents working on full commission. “My buyer’s agreement is actually a little longer than most buyer-broker agreements,” he told me, over coffee on Pearl Street near his house in Boulder. The objective, he added, is to find that particular buyer that really wants to buy, and that wants to do much of their own searching.

What do the feds say about rebating buyer commissions? The U.S. Justice Department encourages the agreements (they’re allowed by state law in 40 states — Lorden links DOJ’s site to his own web site). Are buyer rebates the way of the future? “Absolutely,” adds Lorden, who like other agents, sees the market’s pace picking up this year. “People have been trying to time it to buy low, but now they’re thinking ‘I want to be able to move quickly, I don’t want to miss it.’” The way to start, he adds, is at ColoradoCommissionRebate.com (you need to sign a Right-to-Buy agreement before you make an offer, not after). Or write Tommy Lorden at Tommy@SliceRealty.com.

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IF YOU GO

WHERE: Buyers’ Slice Realty, LLC, limited service buyer-broker that provides a 50% rebate of buyer’s commission according to U.S. Department of Justice guidelines, to purchasers who use the internet or other means to find their own home. Serves all of the Denver metro area and other locations within Colorado.

DISCOUNT: Average purchaser has received over $5,700 at closing
MANAGING BROKER: Tommy Lorden
PHONE: 303-376-6111 EMAIL: Tommy@SliceRealty.com WEB: ColoradoCommissionRebate.com

Jack O’Connor.

“We’re going to see price increases of from four-to-six percent in the market for homes at $250,000 and under,” O’Connor told readers when he released a 2012 Denver Residential Real Estate Annual Report, including a set of “2012 Predictions for Denver Real Estate.”

Some neighborhoods in the $250,000-and-lower range would outperform others, based on inventory and location, he added.
That, O’Connor said, followed from year-end data that show only a 2.4 month supply of homes in the under-$250,000 range. A supply of less than six months, he added, typically suggests prices will increase.

O’Connor also predicted that 2012 will finally see a stabilization in prices for homes over $1 million, a price range that has been disproportionately affected by the real estate downturn and where supply of homes is still very high, around 18 months at current rates of sale.

“You’re going to see some neighborhoods at the upper end showing modest increases in price,” O’Connor noted, adding that inventory in the million-plus range dropped around 16% over the course of last year, for a variety of reasons. He predicts that supply will continue to fall in 2012, ending at around 15 months — still high, but the lowest in several years.

Among other predictions O’Connor makes for the coming year: Upper-end neighborhoods in particular will show a wide disparity in performance, based on location and other factors. Builders will deliver significantly more housing starts in the Denver area, particularly in the lower price range; mirroring Denver’s very low apartment vacancy rates, which he expects to remain low even if unemployment remains the same.

Foreclosures in the metro area will decrease, O’Connor added. Despite efforts by the Federal Reserve, he expects interest rates to rise slightly, heading for 4.5%-5% for a 30-year fixed rate loan.

O’Connor has authored his monthly ‘So How’s the Market?’ letter for eight years. The Denver 100 is a boutique broker-centric service model that emphasizes experience and skills of individual agents – over 20 years on average — and that completes four times more transactions-per-year than the Denver metropolitan average. The Denver 100 has offices at 385 Inverness Parkway near Park Meadows Shopping Center. To receive Jack O’Connor’s So How’s The Market? Trends report, contact Jack O’Connor at 303-880-8561, or on the web at The Denver-100.com.
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Broker Joan Rogliano is showing a mountain main-floor master, four beds/baths on a piney 1.8-acre site with a view across Evergreen – but in the back of her brain swirl the unusually pressing demands of her client practice, one specialized around the “D” word.

Realtor Joan Rogliano of Rogliano Real Estate Group divides time between listings, including this home at $489,000, and the foundation she created to help divorcees.

Six years ago in a better market, Rogliano found that divorcees were gravitating toward her highly personalized services. She reorganized the practice around divorce, adding contacts for various counseling options; then as the market worsened, she set up Wildflower Women’s Foundation, a counterpart not-for-profit that offers scholarships to the newly divorced to get them back to jobs, or school, or beyond other financial crises.

Money problems that accrue when a couple parts ways have grown worse, Rogliano says, as the market skidded. In 2008, few would have questioned a standardized divorce agreement that gives him the 401-K and her the house (after all, she has the kids and wants to provide a sense of continuity). “If we’re upside down on our loan and I’ve got the house, who’s telling me to take this agreement?” Rogliano asks. Clients and their attorneys, she adds, badly need realistic appraisals – and a Realtor’s advice on where things are headed.
Wildflower (it attracted 200 to its annual fundraiser at the Botanic Gardens last month and has earned endowments from Nord Family Foundation, Adolph Coors Foundation, 1stBank, Anschutz and others) also offers mentorships and a DVD on basic legal advice. Thursday Nov. 3 the group holds its monthly event at Pomegranate Place, 750 Clarkson — a pre-holiday fashion show featuring local designers and ‘wildflower’ models. WildflowerWomensFoundation.org has more information.
On the market at $489,000, 5319 Evergreen Heights Drive is a half mile west of Evergreen High — a 1992 home with 2,718 square feet plus 815 finished on a walk-out – the only for-sale in the neighborhood. Rogliano notes that the main-floor master with three secondaries up is a rare plan in the foothills. From I-70 take Evergreen Pkwy south into downtown Evergreen, then right on Hwy 73 to the light at Buffalo Park Road, and west 1.7 miles to Evergreen Heights Drive.
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If You Go…

WHERE: Main-floor master 3,468 s.f. on 1.84 acres.. 5319 Evergreen Heights Dr.; from I-70 take Evergreen Pkwy 7.3 mi. to downtown Evergreen, right on Hwy 73; 0.5 mi. to Buffalo Park Rd. (light), west 1.7 mi (past school) to Evergreen Hts Dr

PRICE: $489,000
WHEN: By Appointment
PHONE: 303-667-5485 WEB: RoglianoRealEstateGroup.com

Ryland Homes’ Ruth Rowley and Damian Story at Steel Ranch in Louisville, Colo.

“Coming into that market, we stopped buying ground,” recalls Colorado Division president Dan Nickless. “We were conservative, we never gave anything back to the bank and we made sure our homebuyers weren’t left high and dry. Now that’s put us in a position with no outside bank debt, ready to what we’re doing now.”

Now Ryland execs are eyeing a comeback of the Denver-Boulder market, already seeing signs of recovery along the Boulder Turnpike corridor. Late this month in Louisville, showcased as one of America’s “best places to live,” Ryland will open its first new community in four years, displaying emphases on sustainability, energy efficiency and livability. Its homes, as with other Ryland designs, will provide a reduced carbon footprint, and features oriented for buyers with tastes that have changed over the past decade. “On sustainability, we’re going to be walking the talk,” Nickless says – maximum energy features, but also new spaces for families that are less formal, and more perceptive about saving money.
Louisville reminds Ryland planners of another area where the Ryland name is prominent. “It’s one of these iconic neighborhoods, a boutique town with little restaurants like you see in California, that people tend to be crazy about,” says Ruth Rowley, Colorado vice president for sales and marketing. Steel Ranch – first new community within city limits in ten years – will feature two model homes at prices from $324,900. (Ryland has a priority information list at RylandDenver.com).
Meanwhile, Ryland is at work on five other openings for later this fall and into 2012, including:
- Vista Ridge, master-planned community in Erie, where Ryland has the last sites backing to Colorado National Golf Club. Ryland’s new Perspectives and Estates Collection models (including some half-acres) will offer a setting that works for commuters heading downtown, into Boulder, or to DIA.
- Castle Rock, where Ryland’s team is at work creating Kings Ridge, south of Plum Creek, to offer easy access to new shopping in small-town surroundings, as well as commutes into the south I-25/DTC area and Colorado Springs.
- Near DIA, already posting solid sales at the affordable end, where Ryland will be in High Point, off Tower Road near 64th, with its Inspiration Collection of attainably priced plans from the low $200s.
You can follow Ryland’s plans at RylandDenver.com, including advance information about all of those communities, and about Ryland’s new emphasis on sustainability.

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If you go…

WHERE: Ryland Homes, preparing sustainable collections designed for new buyer profiles in six Denver-Boulder neighborhoods including Steel Ranch at Louisville, Vista Ridge in Erie, Kings Ridge in Castle Rock, and High Point near DIA.

PRICE: From low $200s; from $324,900 at Steel Ranch in Louisville
WHEN: Openings set for late this month (Louisville) and later this fall
WEB: RylandDenver.com

Governor-elect John Hickenlooper looks out from his transition office on Lincoln Street, a few blocks from where he’ll move into the Capitol Jan. 11.

After all, during the near-eight years he spent in the City and County Building, the former developer watched the Mile High bask in accolades — picked for the Democratic National Convention; rated sixth-best U.S. city for quality of life (Portfolio.com); among the “most sustainable metro areas,” called “a Paris in the West” (Lonely Planet).

National reviewers love LoDo, the new art museum, the crowds flocking to downtown entertainment.

With all of that going for it, Denverites deserved to see some major corporate relocation this new year, and the job growth that would go with it — but the national economy hasn’t shown enough spark to fuel it. “We got gypped,” the governor-elect quipped, looking out from his 41st-floor transition office on Lincoln Street, a few blocks from where he’ll move into the Capitol Jan. 11.

“But Colorado is well poised,” he added. “We’re going to show the rest of the country how it’s done.”

When Hickenlooper and partners were launching Wynkoop Brewing Co. in 1988, Denver was writing the book on how major cities could turn around the blight that all urban cores faced. From a beachhead on a skid-row block at 14th and Larimer streets, preservationists moved on to Blake Street, then up Wynkoop Street to where the ballpark would arrive. “It’s amazing to think,” Hickenlooper recalls, “that in the 23-block area of LoDo, every building has been renovated. It was less than five percent before.”

In 1992, living in one of his lofts over the brewery, he’d close the bar Saturday night as the crowd departed, then rise Sunday and walk down for a paper and a cup of coffee. “There was nobody there,” he recalls. “Now there are people everywhere.

“The investment we made in protecting that historic texture has had a huge economic benefit,” Hickenlooper added. “Other western cities can build new convention centers and new airports, but they don’t have that and they can’t copy it.” Meanwhile, the message got out nationally — culminating with the DNC media frenzy. “The people who came for the convention said, ‘I had no idea,’” he recalls.

Now the governor-elect is shifting his sights to the benefits that could come with even modest job growth. The goal, he told me, is to get government out of the way of job creation … and gave an example that underscores a centrist approach that voters obviously liked: “If a company is drilling for fractured shale gas, if we can cut the time for permitting, that’s better than creating additional government jobs.”

The energy economy, now creating strong job markets in some western states, takes center stage — the “green” technologies, but also the old reliables. “We have as much natural gas under the ground as any state in the country,” Hickenlooper added. Nuclear? “I’m not going to rule it out,” he went on … but added that using energy more effectively, regardless of the source, is just as important to success.Harvey, president of the Colorado Association of Realtors last year, publishes a market report on ten Colorado resorts. He has a web site at TheHarveyTeam.net.
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Prestige Realty Services, at 385 Inverness Parkway, is structured to attract medium-to-large production broker agents, who will be drawn by an exceptionally high level of technical, communications, and marketing support, as well as lower overhead fees, Iacino said.

“This is not a ‘work-from-home’ based company, but rather one that will allow the better agents to use technology to their advantage, whether they’re working from here, or their own office elsewhere,” Iacino said in announcing the venture.

Iacino, who co-founded Prestige Real Estate Group and turned it into Colorado’s largest independent real estate agency, began working on the idea of a new venture three years ago, when through her participation with the national group ‘Real Trends’ she discovered several large brokerages in major metropolitan areas, modeled around high services with a minimal sticks-and-bricks infrastructure.

In 2006 Iacino was named an ‘Outstanding Woman in Business’ by the National Association of Women Business Owners in concert with the Denver Business Journal; and in 2009 was chosen as Residential Real Estate’s ‘Power Book Newsmaker’ by the Journal. That same year, Prestige merged with RE/MAX Professionals; Iacino resigned as president of RMP last month, to launch the new venture.

Jack O’Connor, top producer whose monthly ‘Jack’s Report’ of market trends proved uncannily accurate in predicting some of the Denver market’s ups-and-downs over the last seven years, is also partner in the venture. He also resigned from his partnership in RE/MAX Professionals last month.

“This company will prove to be a very good mix for a medium to upper producer,” O’Connor noted. He is consistently featured both nationally and internationally as a speaker on sales and management, and is expected to head up PRS’s agent training capabilities, including new agent recruiting.

Iacino noted that O’Connor will continue to release his widely read report. PRS will be on the web at PRS-Brokerage.com beginning in January. For information about joining the company, or for a subscription to Jack’s Report, contact Iacino at 303-594-6894.
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Through Labor Day, you can tour 55 new homes scattered about the metro area, plenty of them priced not in the millions, but the $200s, $300s and $400s; designs that might not only show you some decorating ideas, but perhaps make you wonder, “Shoot, why don’t I just buy it?”

“This is a market where buyers are so focused on getting what they think their existing home is worth, they miss opportunities to upgrade their quality of life that make dollar sense,” says Cate Dobson of Distinctive Properties. She’s showing Luce at Lowry, low-maintenance Parade condos from the mid-$3s, with a walkable lifestyle near dining and shopping, at 1st and Rampart behind Lowry’s Town Center.

The Parade’s web site at ParadeOfHomesDenver.com has a search index that lets you sort what you want to see…say, “Under $250,000.” That’ll turn up three, including Wildgrass Townhomes at 4823 Raven Run in Broomfield, a 3-bedroom home with just under 1,600 feet plus basement and oversized 2-car garage. Builder Standard Pacific offers a second master suite as an option.

Or, search ‘Master Planned Community’ to focus on two dozen homes wrapped in amenities…including a “Torino,” a Tuscan styled design at 4219 Opportunity Drive in Morningview at the Meadows, Castle Rock. At $693,000 (others from the high $4s) it features big indoor luxury and lots of outdoor living ideas, including an outdoor kitchen, along with 1,100 acres of nearby open space. “It has a ton of upgrades; it would price out over $800,000,” says Kristen White, Oakwood Homes’ Director of Sales.”

You’ll also find seven ‘Dream Homes’ on the tour, all priced $1 million or over…such as a “Bierstadt” at 7355 S. Jackson Gap Way in Vistas at Tallyn’s Reach, right at $1 million. It won a BAR Award for its exquisite kitchen, magnificent family room, finished basement and other features. You can tour the Dream Homes in return for a $5 contribution to the Muscular Dystrophy Association (all lower priced homes in the Parade are free this year).

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If you go…

WHERE: Parade of Homes 2010 by Home Builders Association of Metro Denver, 55 new homes dispersed around metro area; including affordables, golf homes, in-town living, and more.

PRICE: Free (7 Dream Homes have $5 contribution to MDA)
WHEN: 11-6 p.m. daily thru Labor Day
WEB: www.ParadeOfHomesDenver.com

Professionals Miracles Foundation was founded by Denver area real estate agents in 2000, as a support for families who are battling life threatening illnesses, particularly those involving children.

“We’re looking at Pradera as a venue that will take our very successful tournament to an even higher level,” says Rebecca Kenny with RE/MAX Professionals, 2010 Birdies for Blessings Event Chairperson. “It’s a terrific course that’s genuinely fun and challenging to play, with clubhouse facilities that will add character and capability to our silent auction and ceremonial events surrounding the tourney,” Kenny said.

Kenny adds that Pradera has an ambience that fits the warm, engaging atmosphere of Birdies for Blessings. “Playing in this tournament is always a great social experience, as well as a very moving personal encounter with other professionals who are genuinely interested in helping others,” Kenny added. “For a course with terrific golf architecture, Pradera has a family feel to it that will complement this event and draw in new participants.” The Club at Pradera, she added, had actively sought to recruit the Birdies event from its former long-term venue at Inverness Golf Club.

Major supporters of Professionals Miracles Foundation include agents with RE/MAX Professionals, who launched the charity in 2000 on behalf of one agent’s daughter who waged a successful battle with childhood leukemia. The Childrens Hospital Foundation remains a principal beneficiary of the PMF and of Birdies for Blessings, along with individual families needing financial or other support, often identified by agents and their contacts in the community.

Check-in for Birdies for Blessings begins at Pradera at 10 a.m., Aug. 30, followed by a noon shotgun start. Players register for $250 to include range balls, a hole-in-one competition, and a benefit dinner following at Pradera’s attractive Mt. Elbert Dining Room overlooking the course, where guests can bid on sports memorabilia and other silent auction items. The dinner also includes a public auction of some priority sports and travel items. Dinner tickets exclusive of the tournament are available for $50.

Kenny added that Professionals Miracles Foundation maintains an exceptionally low ratio of overhead costs, well below 10%, and that 100% of its financial support is spent within the Denver Metropolitan Area. Positions for the 2010 Birdies for Blessings Tournament are $250, and Kenny and other organizers are actively seeking hole sponsorships ($250), special dinner sponsors ($2500 to $250), and donations of auction items. To register, visit www.professionalsmiraclesfoundation.org, or contact Becky Kenny at 303-570-9190.
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WHERE: Birdies for Blessings Golf Turnament to benefit Professionals Miracles Foundation, The Golf Club at Pradera, Parker, CO
ENTRY FEE: $250
WHEN: Monday, Aug. 30, Check-in 10 a.m., Shotgun Start non
PHONE: 303-570-9190 WEB: www.professionalsmiraclesfoundation.org

So, what does the year ahead look like for our refrigerated town on the High Plains? After 12 months of tough sledding real-estate-wise, don’t expect a thaw anytime soon…but don’t pack your bags, either. People who make a living predicting the market are saying, all things considered, you’re better off here.

Jack O’Connor, author of a market report for RE/MAX Professionals, sees chilly weather ahead for the highest price ranges, and solid appreciation for people who own homes under $250,000.

“I’m still very bullish on Denver,” economist Patty Silverstein told me this week. She’s president of Research Development Partners, consulting chief economist for the Metro Denver Economic Development Corp. and for the Chamber.

The big factor impacting residential real estate is employment, and Silverstein sees slightly brighter prospects there. “Year 2010 will see a glimmer of hope,” she said, adding that we’re likely to continue losing some jobs early on…firming up later, with the odds favoring a slight increase for the year
That kind of late growth, however, will do little to jump-start the high-end housing market, says Jack O’Connor, who authors a monthly report for RE/MAX Professionals that was surprisingly accurate in predicting lower-end appreciation this past year. At the highest end, the Denver area still has way too much inventory and way too few buyers. If you own a house below $250,000, the forecast is much warmer…some price increases…maybe even multiple offers, once you put the sign up.
“If you have a nice home (priced below $250,000), you’re going to see 4 to 6
percent appreciation in 2010,” O’Connor adds.
In the million-dollar range, prospects are still glacial. Current inventory of 1,100 single-family homes at a million-plus (only 240 closed during the year as of Dec. 30) will take years to absorb. For million-dollar condos, says O’Connor, the temperature drops even more.
Meanwhile, you’re living in a place with a future in aerospace, bioscience, software, and energy…industries hit by the recession, but with temperate long-term prospects.
“You need to look beyond to what the opportunities can be,” Silverstein said.
Colorado, she adds, is perceived by the nation as a very attractive place to live…one that appeals to entrepreneurial types. “That will help us,” she adds.
If you’re selling in the high end, don’t expect improvement in 2010…and,
O’Connor adds, figure that interest rates, which have stayed low for a long time,
could likely climb late in the year. At the low end, watch for the continuing federal tax credit to play an abnormally large role in motivating sales. And remember…it only applies to contracts written by April 30.
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