Feburary 08, 2010
Feburary 2010 Summit County Real Estate.Net Notices
In Freddie Mac Primary Mortgage Mkt Survey (for the week ending January 22nd) in which the 30-yr fixed-rate mortgage (FRM) avg. 4.99%. Last year at this time, the 30-yr FRM avg 5.12%.
The 15-year FRM this week avg 4.40%. A year ago at this time, the 15-year FRM avg 4.80%.
The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) avg 4.27%. A year ago, the 5-year ARM avg 5.24%.
The one-year Treasury-indexed ARM avg 4.32%. At this time last year, the 1-year ARM avg 4.92%.
Oil and Gas Panel Discussion
Because oil and gas issues are so much a part of the lifestyle in Garfield County, GSAR held an oil and gas panel discussion with representatives of all sides of the issue including Don McClure, a Vice President from Encana Gas, Judy Jordan, Garfield County Oil and Gas Liaison, and Tresi Houpt, a Commissioner from the Colorado Oil and Gas Conservation Commission. Issues ranged from the newly implemented oil and gas regulations to the federal legislation on hydraulic fracturing and oil shale development in Garfield County.
Thompson Divide Creek Drilling Panel Discussion
As gas leases near their expiration on land owned by the Federal Bureau of Land Management (BLM) in the Thompson Divide Creek Area, a coalition to protect the land from gas development has been created. The panel discussion included representatives from the coalition, as well as a landowner in the Thompson Divide Creek area. Representatives from the gas industry were invited to participate but declined to because they indicated they will not be drilling in that high-cost area.
ISSUES AROUND THE MOUNTAINS.....
Garfield County Loan Limit Appeal Denied, For Now
After submitting an FHA conforming loan limit appeal for Garfield County in late December, last week GSAR heard back that the loan limits in Garfield County would not be increased for 2010. GSAR had submitted an appeal with well over 100 pages of sales data for the county, and included maps of the area and letters of support from U.S. Senators Michael Bennet, Mark Udall, and Congressman John Salazar, Garfield County Commissioners, Glenwood Springs City Council, Carbondale Town Trustees, State Representative Kathleen Curry, and the Colorado Association of REALTORS®. HUD told the association that while the appeal was the best they have ever seen, the median sales price did not allow them to increase the loan limits for 2010. HUD's data showed that the median sales price in Garfield County from January-August 2009 was $330,000, while the data GSAR submitted from Land Title showed a median price of $362,000. For now, the conforming loan limits will remain at $425,000.
While the initial appeal was denied, GSAR is working on other options to get the loan limits increased. Senator Michael Bennet's office and the National Association of REALTORS® are also doing research into the issue.
LOCAL ELECTIONS BUZZ.........
Eagle County Resident To Run For State Treasurer
Last week, Eagle County resident Ali Hasan announced his candidacy for State Treasurer. Hasan, a republican from Avon, ran for the state legislature last year against State Representative Christine Scanlan. He lost that bid with nearly 47% of the vote. Hasan argues that his experience running a production company makes him qualified to manage the state budget. He has the endorsement of State House Minority Leader Mike May.
State Rep Kathleen Curry Changes Parties
State Representative Kathleen Curry(HD-61, Gunnison) recently announced she is changing her political affiliation from democrat to independent. She indicated that she doesn't fit into either party and would rather focus on the needs of her constituents rather than party politics. She has passed the deadline so she faces an uphill battle with a write-in campaign to be on the ballot for the fall election. She will maintain her seat on the House Ag committee, but will lose her seat as Speaker Pro Tem for the House.
Looking for Local REALTORS&reg; To Run For Open Seats This Year
With many City & Town Councils, & County Commissioners elections up this year, we are looking for REALTORS to run for seats in your local areas.
An Ordinance to Allow the Use of Temporary Open House Signs in Glenwood Springs
Glenwood Springs has not allowed REALTORS® to use open house signs because of concerns of clutter and signs left out after use. GSAR was able to get an ordinance approved that would amend the sign code to allow two(2) directional open house signs and one on-site open house sign that will go into effect January 1st, 2010, and will expire in one year. REALTOR® members who led the issue: Mandy Murray of Mason Morse, Glenwood Springs.
Appealed the FHA 2010 Conforming Loan Limits For Garfield County
GSAR, with assistance from local REALTORS&reg; and title companies, submitted an appeal to HUD to request that the 2010 FHA conforming loan limits be increased from $425,000 to $729,750 to achieve equitable loan limits with nearby Eagle and Pitkin Counties. Results of the appeal should be determined in early 2010. REALTOR® members who led the issue: Ken Williams of Realty & Design Associates, Carbondale.
Rifle City Council Candidate Questionnaire
In order to better inform Rifle REALTORS®, as well as all REALTOR® in Garfield County, GSAR asked nine(9) Rifle City Council candidates to respond to an extensive questionnaire regarding issues from affordable housing, growth and development, to oil and gas issues and local economic issues.
IN OUR NATION'S CAPITOL..... (from NAR)
FHA Releases FAQs on New Condominium Rules The FHA released a frequently asked questions (FAQ) document on the new condominium rules. The FAQs provide some additional guidance to the rules, announced in Mortgagee Letter 2009-46A and Mortgagee Letter 2009-46B. ML 2009-46B provides the formal condominium rules, in accordance with the Housing and Economic Recovery Act of 2008 (HERA), placing condominiums under the FHA 203(b) Single Family Program. ML 2009-46A provides temporary guidance on concentration requirements, the Spot Loan Approval Process, owner-occupancy requirements, and pre-sale requirements. The new condominium rules went into effect on December 7, 2009.
While 2009 was widely anticipated to be a slow legislative year across the country because local, state and federal governments didn’t want to do anything to hurt the real estate and construction industries, it proved to be a very successful legislative year in advancing legislation in the mountain region that would promote the re-emergence of strong housing markets. From reducing permit fees in building departments, allowing open house signs to better market properties, and protecting private property rights and allowing home owners to rent their properties, the local governments worked with local REALTORS&reg; to accomplish mutual goals of supporting local economies through the real estate industry. It wasn’t all rosy, though. Some quasi-government entities attempted to increase the cost of homeownership in some areas, but local REALTORS&reg; were able to ward off these attempts.
City Council & School Board Candidate Forum.
This was the 2nd annual candidate forum SSBR has held to help educate REALTORS®, and the community on candidates running for the Steamboat Springs City Council, and the Routt County School Board. Well over 100 people attended the event, which was co-sponsored by the Steamboat Pilot, and the Routt County Democrats and Republicans. REALTOR&reg; member who organized the forum: Jim Hansen, Old Town Realty.
Visit by NAR Chief Deputy Lobbyist Jamie Gregory and State Senator Al White.
The National Association of REALTOR® Chief Deputy Lobbyist Jamie Gregory, made a special visit to the 4 mountain boards to discuss legislative and regulatory action in Washington, DC pertaining to the mortgage industry, health care, and energy reform. It was also an opportunity for local REALTORS® to express their views on national issues as they relate to the mountain region. State Senator Al White also spoke to the membership, with a wrap-up of the 2009 state legislative session, and talked in depth about the current state budget crisis.
Pursuing State Legislation to Increase the Majority Vote Requirement for Changes to HOA’s Original Covenants.
With the rise in HOA’s amending original documents to restrict short-term rentals in subdivisions, SAR is working to address overreaching HOAs by running a bill at the state in 2010 that would require a higher approval rate by home owners in the subdivision for bigger decisions involving short-term rentals, structural changes to the homes or buildings, and similar financial decisions. REALTOR® members who led the issue: Dee Phelps, Phelps Real Estate; Lisa Bennison Noll, Slifer, Smith and Frampton.
Provided Testimony at the State Capitol Against A Statewide Impact Fee Bill.
The SAR President testified at the State Capitol against a bill that would have expanded the authority of a local government to charge impact fees on new developments and on behalf of a school district, ambulance service, or any local government entity. Based on testimony from SAR, local builders, and commercial REALTORS&reg; in Denver, the bill never made it out of committee. REALTOR&reg; members who led the issue: Bonnie Arnold, Century 21.
Your support of Continental Divide Land Trust allows us to work year-round to protect the natural beauty of our community. To learn more about membership in CDLT and member benefits, click here. Or log onto our website by clicking here to make a secure on-line donation using your credit card or PayPal account.
The importance of protecting our natural environment is paramount in our community where so much of our livelihood depends on maintaining the natural qualities of the land that people expect when they come to the mountains of Colorado.
Forecast for the Week
The week ahead starts out a bit sleepy in terms of economic reports, with no major releases due until Thursday when the Initial Jobless Claims report and the Balance of Trade report will both arrive.
Friday will bring another shot of economic news when the Retail Sales Report - the most-timely indicator of broad consumer spending patterns - is released. We'll also get a look at the Consumer Sentiment Index for an updated snapshot of how consumers are feeling about the economy.
In addition to these reports, the markets will be watching the latest round of Treasury auctions. This week's auctions include longer-term maturities such as 10-year Notes and 30-year Bonds that compete with Mortgage Backed Securities or Mortgage Bonds. So as we've been seeing of late, the auctions could cause some volatility, depending on how well they are received.
Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.
As you can see in the chart below, Mortgage Bonds hit a high for 2009 on November 27th, but traded lower last week due to financial news and a better-than-expected Jobs Report.
Glenwood REALTORS To Appeal FHA Conforming Loan Limits This Week
Congress extended the FHA conforming loan limits in high cost areas to $729,750 for 2010 in late October, but left Garfield County's loan limits at $425,000. This has caused huge discrepanies in home sales in Glenwood Springs and CarbondalBase, where neighboring El Jebel (Eagle County), and Basalt (Pitkin County) already have loan limits at $729,750. The markets are languishing in Glenwood and Carbondale because buyers can go across Hwy 82 and buy a similarly priced home with a smaller down payment and a better interest rate. Late last month, HUD annouonced an appeals process with a deadline of Decemebr 21st. GSAR has worked for several months to collect data to show HUD the relationship between the 3 counties in the Roaring Fork Valley. If HUD will consider the Roaring Fork Valley a "micropolitan area" for their program purposes, loan limits for Garfield County should be increased to $729,750 to close inequitable gap between these communties. Should HUD only rely on median sales prices, GSAR feels that the loan limit could be increased from $425,000 to $480,000. The deadline for the appeal is December 21st, but HUD has not indicated when responses would be made to appeals.
Steamboat Planning Commission To Review Sign Code, Open House Signs This Week
This week the Steamboat Planning Commission will review an update to their sign code that will allow open house signs, 2 directional, and 1 on-site, as well as a sign pole option at the entrance to multi-family units that would allow multiple flyers to be placed in boxes for the "for sale" units. The sign code revisions come after a private consulting company recommended three years ago that the sign code by updated in Steamboat. Last summer the Steamboat Planning staff reached out to SSBR for direction on open house signs, and how to deal with signs at the entrance to multi- family unit complexes. SSBR is encouraged by the language the planning staff will review. REALTORS® will be making 2 requests at the meeting today. Currently the language requires an agents named be placed on the sign so that if there is a violation, that broker may be contacted. SSBR is going to recommend that the Brokerage, or office name be placed on the sign. REALTORS® are also going to recommend that language be modified with respect to the time signs must be removed. A typo shows that signs may not be removed prior to an hour after the end of the open house. The language should say no signs should be removed within an hour. This is the first step in the process of getting open house signs approved. After review by the planning commission, the City Council will take up consideration of changes to the sign code.
New Lender Guidelines
Recent guidelines from Washington have forced a change to the way that loan originators will disclose closing costs for all homebuyers. The purpose of the new Good Faith Estimate is to level the playing field for borrowers comparing loans to be able to make apples to apples comparisons for loan scenarios.
In essence, HUD is working to bring all lenders up to the same standard of excellence in reporting closing costs that I have always adhered to, estimating realistic fees that a buyer should expect to pay at closing with no last minute surprises.
What are the important facts you should be aware of in having conversations with homebuyers? Below are some important points to know:
All fees paid to the lender/broker are to be consolidated in one line, including processing fees, origination fees, etc. These charges cannot change from the original estimate without a material change to the loan requested. In the event fees are being charged to obtain a lower rate, these are to be broken out and itemized for the borrower's ease of comparison to other loan programs.
Estimates for fees from government recording charges and third party settlement providers we suggest are to be itemized and the lender is held to a tolerance of 10% for their accuracy. In the event the estimated charges exceed the amount listed by the allowable tolerance, the lender will be responsible for making up the difference.
Estimates for services that the buyer can shop for and do choose can change at settlement without the lender being held accountable. This can include title charges, homeowner's insurance, and initial deposits for an escrow account.
The media's recent analysis of the economy has run the gamut of late, some optimism, some pessimism...but also some confusion as they attempt to decipher recent economic reports, particularly relating to the job market. Let's look at a few of the recent reports, and get behind the headlines to decipher what they really mean.
Last week's Initial Jobless Claims Report showed that 505,000 people filed for unemployment benefits, which was about what was expected, and represented a ten month low for the report. The Continuing Jobless Claims Report, which indicates the total number of people collecting unemployment benefits, fell by 39,000 to a total of 5.61 Million.
The media often spins this data as good news - but the labor market remains in exceptionally tough shape. The Continuing Claims number declining from a record high of 6.82M in June to last week's 5.61M is the result of only two potential things happening: People are finding jobs and no longer need unemployment benefits, or they have been unemployed for so long that their benefits are running out before they've been able to find a job. With a 10.2% Unemployment Rate looking like it will move higher still, it is most likely the latter. Another clear sign of a very troubled labor market was back on November 6th, when President Obama signed a bill that will extend unemployment benefits by an additional 20 weeks...there would be no reason to do this if jobs were being created.
There aren't any easy answers - but it's clear that the labor market needs to see some serious improvement for the economy to recover in a significant way.
Bonds and home loan rates were unable to hang onto improvements made in the earlier part of the week, and ended the week around the same levels as where they began.
In Freddie Mac Primary Mortgage Mkt Survey (for the week ending November 20) in which the 30-yr fixed-rate mortgage (FRM) avg. 4.83%. Last year at this time, the 30-year FRM avg 6.04%.
The 15-year FRM this week avg 4.32%. A year ago at this time, the 15-year FRM avg 5.73%.
The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) avg 4.25%. A year ago, the 5-year ARM avg 5.87%.
The one-year Treasury-indexed ARM avg 4.35%. At this time last year, the 1-year ARM avg 5.29%.
Recently the County Commissioner Chambers were packed full of Stagecoach lot owners and REALTORS?, with people out the door, ready to fight the Morrisson Creek Water & Sanitation District's(MCWD) planned second amendment to limit additional vault permits in Stagecoach to 30-and they succeded! The meeting began with a presentation by MCWD of the history of Stagecoach, and how the MCWD got to where they are today. In the presentation, MCWD made it clear property values would drop to near $1000 under the proposed plan, but that property values weren't their responsibility. They also responded to SSBR's letter to the County Commissioners in a power point presentation. They agreed to SSBR's assertion that MCWD is unwilling to construct the necessary infrastructure for development. MCWD argued that in order to achieve development for all of Stagecoach, MCWD would end up in Bankruptcy again. MCWD also believes they cannot legally develop some subdivisions and not others. There was an endless line of lot owners speaking against the proposal, how it would effect their property values, their ability to get sewer, and water, to their homes, and to the jaded process of approval by SPOA and MCWD. Suggestions were made to address the vault issues, such as allowing lot owners to aggregate parcels to achieve the 5 acres necessary for an individual leechfield-but allowing those parcels to not be contiguous. SSBR's cap and trade recommendation, to allow permits to be transferred once a property owner has installed central sewer, was well-received, and even MCWD felt it was worthy of studying the possibility. Another suggestion was to create a local improvement district(LID) to fund infrastructure in Stagecoach. MCWD felt strongly that it would not happen because 76% of property owners would have to sign a petition to get it approved. The County Commissioners made it clear to everyone in the room that if Stagecoach were developed today, it would have been done differently. The commissioners also wanted to make sure lot owners understood there is no "right" to a sewer vault in Stagecoach, and that many will never have access to sewer and water. One of the most legitimate concerns made by the Commissioners was that many lot owners will be paying fees to MCWD and will never receive service. They felt this will be taxation without representation, and that lot owners may begin to petition to get out from under MCWD. After 3 hours of debate, the Board of County Commissioners ultimately voted no to the MCWD's proposed 2nd amendment.
Glenwood City Council Poised To Allow Open House Signs!
On November 19th, the Glenwood Springs City Council held their final debate on open house signs before moving ahead to consideration of an actual ordinance in December. By a vote of 5-2, the Council agreed to consider an ordinance allowing open house signs in Glenwood. Stephen Bershenyi, Matt Steckler, Shelley Kaup, Russ Arensman, and Dave Sturges all voted in support of allowing open house signs, while Leo McKinney and Mayor Bruce Christensen vehemently opposed the ordinance that would assist REALTORS? in selling properties.
On December 3rd at 6:00 pm, the Council will consider first reading of the ordinance, and second reading will occur on December 17th. Please mark those dates on your calendar and plan to attend the City Council meetings to show your support for open house signs! Once the Council approves the ordinance on December 17th, the City is required to publish the new law in the newspaper, and the law will take effect in early January. Many thanks to the REALTORS? who attended the Council meeting! Your support was important for the Council to see!
As a reminder, GSAR is discouraging REALTORS? from using open house signs in Glenwood unless you contact the police department first for exact placement.