Real Estate ripples

While local real estate markets set a record for sales volume in July, transactions for the year to date are only at 57% of what they were last year in July.  The market locally feels better then it is.  The Vail market has not adjusted yet.  Part of the problem is that people with lots of money have decided to wait out the current downturn and are not spending much on anything. There is still money out ther ebut the dynamics are changing.  The biggest dynamic , at least for the foreseeable future will be tougher lending standards. The first time home buyer will probably not be able to get financed.  Banks underwriting policies are staying rigid evn through the easy credit days of the last few years. AS the financial market teeters mortgage brokers in the valley are confident in the long term strength of the economy.  The good news is that the fundamentals of the economy are still very good, and tis will pass too. When emotion drives the market, that is where opportunity is. The bottom may be in sight, and that is when buyer’s will start buying again.

The upheaval of the American financial system sent shock waves through the stock market Monday producing teh worst day on Wall Street in 7 years, as investers digested the failure of one of its most venerable banks and wondered which domino will be next to fall.  The Dow Jones industrial average lost more than 500 points, more then 4% its steepest drop since the day the stock market reopened after the 9/11/2001 attacks. About 700 billion evaporated from retirement plans, government pension funds and other investment portfolios.

the carnage capped a tumultuous 24 hours that redrew US finance. Lehman Brothers, an investment bank that predates the Civil war and weathered the Great Depression, filed the largest bankruptcy in American history.  A second storied bank, Meryll Lynch, fled into the bank of America.  It was by far the most stomach churning single day since a financial crisis began the bubble up from billions of dollars in rotten mortgage loans that have crippled the balance s heets of one bank after another and landed mortgage giants Fannie Mae and Freddie Mac under the control of the federal government.

On thursday, 4 Democratic senators urged the mortgage companies Fannie Mae and Freddie Mac to freeze foreclosures for 90 days on loans they hold.  The troubled companies, seized by the government Sunday, should help struggling borrowers swap their mortgages for more affordable loans and stay in their homes, the lawmakers said.  An estimated 2.8 million US households will face foreclosure, turn over their homes to their lender or sell the propertie for less than their mortgage’s value by the end of next year.  Last month default activity wa sup 10% froma  year ago and auction activity up 7 percent year over year.

The next six months will be critical in terms of the housing crisis.  Consumers and investors will be tracking volatile financial markets, judging the success or failure of this year’s housing bill, monitering the government bail out of Freddie and Fannie, and anticipating the impact of a new president.  On the bright side if home prices and sales stabilize or improve, the foreclosure situation could get better.  But the slow economy, high unemployment and volatile financial markets present obstacles to improvement in the foreclosure situation. Together California, Florida and Arizona accounted for more then half of the nation’s volume of foreclosure activity.

With easy access to skiing through Arrowhead and all the amenities of bustling downtown, Edwards Colorado residents have a way of saying “Why go into Vail?”  The newest addition to the community, The West End project, will build out the 4th, the northwest, corner of downtown Edwards, giving us more reasons to stay and support our local community.  A residential and commercial development, The West End will blend city life conveniences with a casual mountain lifestyle.  The project is located 3 miles from skiing Beaver Creek, and 12 miles west of Vail, and will have a bus stop right out front to access both.      

The West End offers two types of ownership opportunities.  Market rate units are the standard type and workforce are deed restricted, capping annual increase in property value.  The West End consists of 113 market rate and 72 workforce residences.  Both types of homes consist of studios, one, two and three-bedrooms with variations including dens, lofts and (my favorite) roof top patios. 

Not only will the urban center emphasize pedestrian access, but it will provide a pedestrian core we lack in other areas.  A pedestrian square with fountains, fire pits and a kids’ play zone will serve as the main corridor to the Eagle River Preserve open space, trails, walkways and the Eagle River.   Bottom level homes in the two northern buildings will sit right on the open space, giving them the luxury of a 72 acre backyard.  Residents of The West End will enjoy a fitness center, outdoor hot tubs, and underground assigned parking and storage units. 

It’s not just locals that have fallen in love with Edwards.  Read a New York Times blog Down To Earth in the High Country.

And click her to find more information on Edwards

For more information on The West End, Edwards or other Vail Valley real estate contact Karen Gilbert at 970-331-1482 or karen@gatewayland.com, or visit my website www.karensellsvail.com.

The ranch land of Wolcott CO is the prefect place for a new community

In contrast to the rest of the I-70 corridor through the Vail Valley, ranching heritage has been preserved in Wolcott with a wide open valley floor, natural sloping hillsides and perfectly unimproved banks of the Eagle River.

This will change in the near future as the Jouflas family wants to sell the land, hopefully to a good developer who will take advantage of the opportunity to build a community from scratch.

Whoever develops it, the county is working on guidelines for the community’s future master plan. With the valley continuing to grow we’ve got to make a proactive step towards a balanced community and guess what – we have the space to do it. No more arguing over what is meant to be done with Edwards. No more disputes over builders’ obligation to build affordable housing. Let’s do this right and put an end to our seemingly endless housing issues.

Instead of building another pieced together community like Edwards, why not build connecting neighborhoods with sidewalks, parks and bike paths? There’s enough space in Wolcott to preserve some of the area’s rural character and to support several neighborhoods, a pedestrian focused downtown area with a grocery, movie theater, shops, restaurants and services.  

It sounds obvious, especially with the success of a similar concept in Eagle Ranch; we can only hope the county will plan it accordingly and agree to allow the right developer to complete the project. 

For more information on Wolcott, or other Vail Valley real estate, call or email me or visit my website below.

Eagle County considers a new Housing Authority

Eagle County Commissioners will vote this week on forming a Housing Authority which will assure that new developments in the Vail Valley be responsible for the housing needs their projects create. The County staff has been meeting with developers and planners to establish guidelines that some worry could discourage new construction in the Valley.

Under affordable housing guidelines now being proposed developers would have several choices: 1. 35% of the total square footage must be ‘work force’ housing. 2. 30% of the project must be ‘work force’ and another 10%  owned by locals. 3. 30% of the project would be ‘work force’ and all the market rate homes would be sold with a 15% Transfer Fee for a future ’affordable housing’ fund. 4. 25% of the project would be ‘work force’, 10% locally owned, but sold at market rate and the Transfer Fee would apply to all market rate sales.

On the commercial end, developers would have to build enough ‘work force’ units to handle all new jobs created, which means about 715 sf of housing for every 1,000 sf of commercial space created. Hotels would have to build 204 sf of ‘work force’ units for every one hotel room constructed.

The continuing problem of affordable housing will now be a major issue for any new development in the Vail Valley, but no one knows if the above will be the final solution. Keep in touch with Valley issues by contacting Judd Babcock at 970-376-3230. We have always been the best place for local information on the Valley’s real estate market.

Abundant educational and financial help available for locals

Think you’ll never be able to buy a house in the Vail Valley because you can’t come up with a down payment?  You’re not alone.  Pick up any local newspaper on any day and you’ll find an article on this ever present county wide issue.  With the average price of a single family home at $535,350, many Eagle County residents are having a hard time figuring out a way to combine two of their life long dreams – to own a home and to live in the Vail Valley. 

So if the average family in the county can afford to pay $253,000 for a home, how can locals bridge the gap between what’s out there and what they can wrap their wallets around?  You may be surprise to find out there are many groups out there wanting to give you help – educational and financial.  You just need to know who to ask.

Eagle County offers a wide variety of services to get you ready for the big adventure of buying a home.  Get started by taking the free Home Buyers Class held at the Eagle County Building at 5:30 every month (see link to Eagle County Housing below for class schedule).  Even if you’ve owned a home, this class is full of great information on repairing credit, the basic mortgage process, homeowner’s insurance and foreclosure prevention.  p.s. – if you’re thinking of getting county down payment assistance, you have to take this class.

Don’t think your credit is good enough to buy a home? Eagle County offers free credit counseling. Call Leona Perkins at 328-8770.

Now for subject everyone wants to know about – money, preferably in the form of down payment assistance.  Here are 4 sources: The Eagle County Fund, Colorado Mountain Housing Coalition, CDOH and the H20 Fund. 

These resources are based on income levels which are pretty high for at least a couple of the programs.  Do you make under $81,100 a year for a family of 1 (higher for more people)?  You may qualify for 2 programs that offer 5% of the purchase price of a home, up to $20,000, and you do not need stellar credit to get help.  That’s up to $40,000 assistance and that’s only 2 of the 4 programs, which can all be combined together. 

The Colorado Housing and Finance Authority (CHFA) has many programs including the ever popular Mortgage Credit Certificate (MCC), which allows buyers to take a portion of their mortgage interest as a direct credit to their income taxes (the rest of the interest is taken as a deduction).  If you don’t know what this means - it’s an incredible program which can put a couple thousand dollars back in your pocket.

There’s also the Funding Partners who offer several types of loans to homebuyers and also help lenders stack all of the programs out there so you can us as many programs as possible to get you to the ultimate goal – owning your home.

I know – it’s a lot of information on a subject that is confusing at the basic level.  The first step is to take the class.  Second – talk to a lender.  There’s a list of lenders on the Eagle County website (see links below) who work with these programs.  Third – if you need it, get credit counseling.  Fourth – call me with any questions along the way and when you’re ready to go find your home. 

For more information on home buyer assistance and Vail Valley real estate contact Karen Gilbert at 970-926-6777 or karen@gatewayland.com