Karl Lueders - Denver Realtor

In the past 30 days, the following has happened to my buyers and listings:

- One buyer lost out on two houses because of multiple offers on houses in Wheat Ridge, a western suburban off-shoot of the Denver metroplex. He finally found a house that had been on the market less than two weeks because it needs a bunch of cosmetic work. Price point: $230-250k.

- One buyer lost out on two houses in Denver proper because the houses both had offers the first days they were on the market. She was able to secure one because she agreed to a back-up position on it and the buyer backed out. The seller has also agreed to fix nearly EVERYTHING on the inspection list. Price point $180-200k.

-Half-duplex went under contract in one of Denver's hottest upcoming markets, Sloan's Lake, in two days (one day, technically). This is one day longer than the duplex around the corner from this property that went on the market two weeks prior. Price range $190-210k.

- Finally, one buyer got in a bidding war on a property in the Denver Highlands on a house that was originally listed at $275k and dropped to $265k. She bowed out of the war, which ended up bringing the price of the house back to near its original list price.

I'm truly amazed at how hot the action is in this price point. None of these buyers are investors. All but one are getting FHA loans, and the people selling are moving up to higher price points. The sweet spot, at least in Denver, is anything under the $417k loan ceiling, and if you're a first-time home buyer, more power to you.

Using this data as an indicator of the future, I have to imagine that the people selling these $200k-ballpark houses are moving into $300-400 houses, you would think. That's at least where my clients are moving to, once they sell their places. And once they buy, those sellers have to move somewhere else, and so on, and so on...

Theoretically, once all the "lower" price point inventories have been thinned enough to create a balanced sales market, then the buyers should eventually be heading into the higher price points. Of course, this type of organic stimulation won't reach the $1million-plus levels for quite some time, but logic points us in this direction.

That is, unless there is so much inventory at the $300-500k range that all the displaced sellers from the first-time homebuyers can't make a dent in one of the higher price ranges. Which doesn't afford a trickle-up opportunity and all this homebuying frenzy in 2009 stops at midfield and the resale sector of the residential real estate market has to punt in 2010.

The other road block is the inability for buyers to get jumbo loans. We had a speaker come to one of our sales meetings recently and try and get us pumped up about the high-end market and the signs of life there. The next week, we were provided with a chart by one of the more prevalent real estate consultants showing the jumbo-loan flatline starting around November 2008. To complement that chart, a mortgage officer from a fairly well-known national bank spoke that while he has seen some million-dollar deals come by his desk, the buyers are ponying up their own cash to get their loan under the conforming level.

The problem is that the average $600,000 homeowner that's looking to get to the next level doesn't have that kind of jack to get his loan under $417k.

For those of us in real estate sales, I would love to see 2010 improve upon 2009, simply because 2009 has shown some amazing signs of life, but I'm dubious about seeing the money flowing uphill.

My Firefox opens to The Denver Post's home page - kind of my nod to the news since I cancelled my hard copy subscription years ago. I don't need it for sports, since I have that in my ear on the radio, nor do I use it for the weather (what's more unreliable than the TV weatherman?... what the TV weatherman writes for the paper!). It's more to get a snapshot of the world at a given moment. The Web allows "newspapers" to become organic beings. Good for the end-user, if done properly.

Unless, of course, you want to start your day off poorly. Here were the slate of headlines that sit in the middle of the Post's site as of 8:15 a.m., MDT.

11 Headlines: 3 that do not imply death, disease or financial shortfall. Read them top to bottom. The last one becomes funny, then.

The Twitter headline is more of a throwback to the days when the newspapers were simply behind the curve on trends - nostalgic, even. Westminster obviously has smaller fish to fry and of all the headlines above, the only "positive" headline is about the successful transplant, but only after a hair-raising journey. If you thought that the $18M award to the paralyzed kid is an uplifting story... someone's paralyzed and a bankrupt company is on the hook.

So that's how my day started. I think I'll go for a run and be thankful for what I have.

This article came through The Denver Post this morning regarding a 46% percent drop in foreclosure notices in Q1 of 2009 over that same period in 2008.

Check it out here.

It says that while metro Denver has eased considerably, national activity has risen 23% and notorious foreclosure hot spots like Las Vegas have doubled from 2008.

I'm happy for headlines that have "foreclosures" and "drop" in them, but I'm thinking of a tsunami right now. As in, you're lying on the beach soaking up some rays and all of a sudden you watch the waterline suck back into the ocean at about 20 ft/second. Next thing you know, Q2 foreclosures are at a record high (Q1 2010, more likely).

I don't want to sound like a sore winner, but I'm dubious about this cycle.

There is a message here, bear with me... I cancelled my buyer appointments today as you will soon find out why.

I do miss these days. It reminds me of Chicago and why I love that city but will never go back. Currently, central Denver is getting pounded mercilessly by a sleet/snow mixture that should let up sometime next week. Last night it rained because it was too warm to snow, but now it's sticking. Denver is an odd town weather-wise. I read in USA Today how Denver gets backloaded with all of its snow in March and April,

which shouldn't be surprising, since the two of the three worst snowstorms I've ever experienced have been in March in Denver. Granted, I've only been here 10 years, but living here seems to validate one of my half-baked theories from my younger days.

I remember this one particular summit amongst my Chicago friends - that all-too-common conflagration where four or five of us would solve every problem thrown our way, only to realize that we didn't have the staff to delegate the implementation of any of these ingenious ideas. To get an idea of how long ago these summits occurred, one out of five people had a cell phone and the other four would laugh at that guy as he made weird gyrations trying to hear the person on the other end.

Anyway, I postulated that - I had no scientific backing, just 30 years of observation - that the seasons were oblivious to the calendar and that by 2045 (50 years from my proclamation) summer in the northern hemisphere would be more in line with the autumnal months and winter would start infringing on the traditional spring stretch. I had been seeing warmer Septembers and whiter Aprils for a while now, and it doesn't appear to resetting, and the idea of a white Christmas seems almost nostalgic, unless you live in Buffalo (or Denver, specifically).

Granted, this weather doesn't do us any favors as Realtors (I'm preaching to my Colorado brethren), but I'm beginning to think that while Denver's selling season doesn't have the sharp dip of the Eastern seaboard cities, we also shouldn't assume that the selling season begins after the Super Bowl ends. I've had several listings in the past three years get false-started on the market because prolonged snow storms have stymied their debut. Yes, when your sellers are ready to go, weather isn't much of a factor, but if you're teeing up a listing for maximum effect, May 1 appears to be a safer bet than March 1.

It can stop snowing anytime now...

Karl Lueders is a Denver-based Realtor who loves cold, snowy days just as much as his black labrador Sadie does. Except that Karl won't roll on his back in a three-foot snow drift. Find out more about Karl here or how Karl and Sadie are helping Denver's pet community stay healthy at The Goethe Fund. Look for this logo on future Karl posts:

Since my last look into our neighborhood's sales performance (2007-2008), I was able to conclude that while the rest of the world seemed to be drowning in sorrow, Driving Park Historic District was decidedly middle-of-the-road sales wise. I'll take normal over recession any day of the week, but that's pretty where we've been for the past 6 months, and that's where we appear to be right now, even after a few distressed sales.

Based on the latest sales data from Metrolist Inc., Denver, as a whole, has about 6 months worth of inventory currently for sale. What does 6 months of inventory actually involve? For example, within Driving Park Historic District, where I live, 17 homes sold in 2008. That comes out to 1.41 homes sold per month. Currently, we have 9 active listings in DPHD, which, divided by the average sales per month, puts us right at 6 months as time it will take to clear out our current inventory. In actuality, three homes have sold in DPHD so far this year: 571 High, 450 Williams and 484 Lafayette, which means we're slightly behind the 6 month curve, but the balance is there, which is good.

To get an idea of the houses that are currently for sale, go to my search site and check out the addresses listed in the chart below.

The average sale price isn't so much of an indicator of neighborhood performance as is the sale price - to - list price ratio. Currently, we are holding steady at 94% of list price (that's based on the last list price, sale price - to - original list price is around 90%, which is also normal, but shows the inevitable price drop). Disregard the average sale prices for 2009, as 571 High really threw off the balance, dropping nearly $500,000 between its original list price and eventual sale price.The reason why I don't look at sale price for DPHD is because we have houses that sell between $250k and upwards of $2 million within a 14-block area.

If you have any questions about the chart below or about this neighborhood, feel free to contact Karl Lueders at 720-971-8267. You can also reach him at his Web site, www.KarlSellsDenver.com. Karl lives in Driving Park Historic District on Humboldt St. The neighborhood runs from 4th Ave to 6th Ave, and from Marion to High St. It is surrounded by Alamo Placita, Seventh Avenue and Country Club historic neighborhoods.

If you're interested in the historic significance of the Driving Park Historic District, give me a call or drop me a line. You can find more sales data at Denver Real and Beyond.