We are quite fortunate in the Yampa Valley to have not experienced the volume of short sales and foreclosures that so many have experienced across the nation. Total short sales and foreclosures constitute less than 2% of our market. The name short sale is definitely an oxymoron since nothing about the process is short.  

 

Land Title Company has just released the February sales numbers and found that total sales volume for the month of February 2010 is 267% over the volume from February 2009. Year to date volume is up 228% compared to the same period in 2009. Units Sold are up 165% from February 2010 compared to February 2009.

  While Volume and Units are up over last year, the number of loans recorded is down. Year to date in 2010 there have been 283 loans compared to 487 through the same period in 2009, once again proving that cash is king.   

This points out that there are still significant issues with current lending. The problem started when, as a knee jerk reaction, Congress bailed out financial institutions toward the end of 2008 with billions of dollars (the taxpayers) of interest free money. The hope was to inject this money into the economy via a variety of loans. Because there were no regulations in place as to how the bail out money was to be spent, the financial institutions simply took the money and deposited them into government backed bonds paying 3% interest.

  

Although many of these institutions have paid back some or most of the funds we, the consumer, are still feeling the effects of the unavailable money. In the Steamboat Springs Condominium market we are seeing a real catch 22. This is a product that, in our market, is the only housing available for first time homebuyer’s who are trying to take advantage of the tax credit. However, since they cannot get financing they also cannot take advantage of the tax credit.

  As with most of life, the good news is balanced by reality and as my Mother always used to say “This too shall pass�.

What would happen to Steamboat if there wasn’t a little controversy every now and then? As you can imagine a housing development of 487 acres that will, over the next 20 to 30 years provide an additional 2,500 housing units of varied types is likely to stir some debate.   

This master-planned project based on “New Urbanism” will integrate apartments, condos, townhomes and single family homes into a community setting that will also offer an area of commercial including a grocery store. No residence is more that a 1/8th mile from the nearest free to rider city bus stop. Included in the project are over 148 acres of parks and open space. Hiking and bike trails throughout the community will link to Silver Spur as well as the Steamboat Core trail via a tunnel under US 40 that will be built by the developer.   

In cooperation with the School district there will eventually be a K-8th grade school built on a nearby exiting site already owned by the school district. A new fire station is also incorporated into the development along with significant highway improvements for that area.   

Steamboat 700 has been endorsed by the City of Steamboat Springs as well as the County Commissioners, School district, Steamboat Pilot and Today, Yampa Valley Medical Center and many local civic leaders.   All ballots for this City wide election are due by March 9th and tabulation has already begun.

We at Buyer’s Resource feel that this project has been well planned and fits within our West Steamboat area plan that was revised in 1998. This project allows for an affordable housing component but more importantly provides our workers with an attainable housing alternative within the Steamboat City limits. The developer has worked diligently to listen to the needs and wants of the community and has obliged with this plan. We endorse this project and hope that you will take the time and effort to fully understand the dynamics and scope of Steamboat 700.  

That is been the Steamboat Springs mantra as we sent 17 young athletes from the winter Sports Club off to Vancouver and the Olympics. The send off was a party as we blocked off Lincoln Avenue and brought in a huge monitor and stage. More than 2,000 people gathered to celebrate and encourage these great representatives. The lighting of our own Olympic torch on the County Building lawn and fireworks off of the roof helped warm the celebration.

 

Highlights of the games for the Steamboat crowd were the Nordic Combined which consists of jumping followed by cross-country skiing.  Two individual events sandwich a team event. In total there are 9 medals awarded to the Nordic Combined events. The United States team made up of primarily Steamboat born and/or raised athletes won 4 of the 9 possible medals.

 

It all started on the 2^nd day of Olympic competition with the normal hill individual. Steamboat native Johnny Spillane took a silver medal with Steamboat Native Todd Lodwick  taking 4^th and long time Steamboat’s winter sports club athlete Bill Demong taking 6^th place. This set up the team event where 4 team members jump then run a relay of 5k each. At the end the Americans with the three skiers above plus Bret Camerota were able to take 2^nd place and walk away with a silver medal. Last of the events  is the large hill individual which saw Bill Demong take the gold followed closely by Johnny Spillane. In the history of the Olympics the United States had never won a medal in only two events, Biathlon and Nordic Combined.  Thanks to the great teammates and friends from Steamboat Springs that 86 year drought has been snapped.

 Now all that is left is to welcome them all home. That, my friends, will be quite another celebration!

This article appeared in a newsletter produced by Joe Birkinbine of ATP Financial Services here in Steamboat. Joe is a financial planner as well as an instructor and trainer for pilots. I thought the article interesting enough to share.  Ulrich  

Price bubbles in technology stocks, crude oil, home prices, credit, and other areas posed far-reaching problems for investors.

For example, the past two recessions were each preceded by (and likely caused by) price bubbles: The recession that began in December 2007 was preceded by a bubble in real estate; the 2001 recession was preceded by a bubble in technology stocks.  Federal Reserve chairman Ben Bernanke told Congress that asset price bubbles and the financial booms that they cause were perhaps “the most difficult problem for monetary policy this decade.�

The hot topic right now seems to be where the next bubble will pop up in our economy. But can ordinary investors protect themselves from bubbles? Is it possible to tell the difference between an asset bubble and a legitimate investment opportunity?  What Is a Bubble?A bubble typically occurs when there is widespread speculation that a particular asset is going to increase in value. The subsequent spike in demand for the asset drives up the price, but when the anticipated gains don’t materialize, some segment of the investing public is left holding an overpriced asset. Losses occur as the market adjusts to represent the true value of the asset. Bubbles can occur in the economy at large, in a particular financial market, or in a particular security or commodity. Generally speaking, most bubbles get started with the belief that the investment is a sure thing and thus anyone who manages to purchase the hot asset is guaranteed a return because the price will always rise. One other common ingredient is the notion that fundamentals don’t matter anymore, which leads people into a things-are-different-this-time mentality.  A Saltwater BubbleHistory is littered with investment bubbles, but the first may have been the South Sea bubble, a stock scam in 18th century England. See if any elements of this story sound familiar. The South Sea Company was granted a monopoly on trading routes with Spanish South America in exchange for assuming England’s war debt. So great was the anticipated value of the trade routes that investors became desperate for South Sea Company stock. The company simply issued shares to meet the demand because there was no law to prevent it from doing so. It soon became quite fashionable to own South Sea shares. Many of England’s rich and powerful were drawn in, which, combined with the company’s lavish offices (built and furnished before any trade voyages were launched), further added to the perception of a sure thing. The share price peaked after appreciating 1,000%. When eventually it became evident that the company was making little profit and its officers had acted fraudulently, the share price plummeted. Thousands of investors were bankrupted, and not only because the stock crashed. In addition to spawning many copycat scams, the scandal caused bank failures and a loss of confidence in stock investing. The British government responded with legislation that later came to be called the “Bubble Act of 1720.�2 

Minus 28 degrees! That’s right, minus 28 this morning. A friend who lives west of town by the river had it at minus 33. What does that mean in Ski Town USA? Pretty much business as usual. School isn’t cancelled until the thermometer hits 40 below. Both of my girls went through the entire school system here in Steamboat and NEVER had a snow day.

The temperature on top of the gondola on Mt. Werner sat at a plus 8 degrees as of 8:00 am this morning. That is a 36 degree difference from town to the mid way point of the Steamboat Ski area. Another way to look at it would be the same difference from the temperature that water freezes to a short wearing, golf playing 68 degrees. How is this possible? It’s called a temperature inversion. Cold air is heavier and sinks down the valley walls while a layer of lighter, warmer air caps the inversion. Most people won’t believe it until they experience this phenomenon.   Alright, enough about the temperature, let’s move on to another number. 118. That is the number of inches of snow that the ski area has received to date. This pretty much puts us on par to reach our average of 350 inches of snowfall for the winter. The winter of 2007-2008 brought us our highest snowfall total of 496 inches. The interesting and forgotten number is that the Ski Area closed a week earlier than normal that year and the week following the end of the ski season we received another 60 to 70 inches which would have increased this amount dramatically. The most snow fall in one month was January 1996 where we saw 216.5 inches of snow fall.Let’s move on to 3.8%. That is the national inflation rate for 2008. 2009 actually saw a .04% decrease in inflation. Unemployment has gone from 5.8% in 2008 to 9.3% in 2009. Again on a national level existing home sales (in the millions) have increased from 4,913 in 2008 to 5,011 in 2009 with the National Association of Realtors predicting another increase in 2010 to 5,694. NAR is also predicting a 3.6% increase in cost of homes for 2010. Within the Steamboat Springs area Multiple Listing Service (MLS) we saw 427 single family home sales in 2007 down to 148 in 2009. Average price of a single family home in 2007 was around $800,000 and in 2009 was $631,000. Of course there are a myriad of reasons why there are these differences. Remember that these are only the single family homes and do not include condos, townhomes, multiplexes or fractional. Still it is always fun to look at these numbers. Numbers are what we do at Buyer’s Resource. We do it because it is fun and interesting but, most important; it’s valuable to understand the market in which we live. Of course we go into much more depth and detail but this blog is longer than anticipated already. Why not just give us a call and let us know what numbers you would like to glean and let us show you how we can put these numbers and our expertise to work for you. 

As we wrap up the Holiday season with one more big bang to go we begin to anticipate what might be in store for us in the upcoming year. Will 2010 treat us better than 2009?  Let’s take a quick review of where we stood this time last year. Interest rates on Dec. 31, 2008 for a 30 year fixed mortgage was 5% Today the rate is again at 5%. The DOW was at 8776.39, today we are at 10548.51. The S&P has jumped from 903.25 to 1,126.42 and the NASDAQ has risen from 1577.03 to 2291.28. Quite a dramatic rise when some predicted that the DOW would plummet to 6000. The question of course is; is this real? Will we see another significant drop? Oh, if I only had a crystal ball. One thing that hasn’t changed is that all of us at Buyer’s Resource remain dedicated to serving you, the buyer, with the best service, knowledge and expertise. 

 

Most economists believe that the recession has bottomed out and we are on the upswing to recovery.  Of course until unemployment drops and some of the housing inventory is absorbed we won’t be able to really claim that the economic crisis has been alleviated.

 

What does this mean to Real Estate in the Yampa Valley? Because we are, in the most part, a secondary housing market the economy that hits the rest of the nation generally lags about 6 to 12 months before hitting us. Over the past couple of decades there have been several smaller recessions that have simply missed us altogether. Of course this also means that while other markets are seeing significant signs of recovery and increased housing starts and sales we still have significant inventory hat will need to be absorbed. This is further complicated by the current lending practices toward certain product types.

 

We at Buyer’s Resource of Steamboat always seem to have our glasses half full and see 2010 as a recovery year. We believe that Steamboat Springs as a resort and as a community has a lot of upside for the future. The pressure of the Baby Boomers retiring at a pace of 4 million per year for the next 16 years will continue and more and more of these folks are active and healthy and don’t wish to spend the rest of their lives playing shuffleboard and canasta. Steamboat will remain an attractive area to move, relocate and retire to and we, as a community need to be proactive in planning for this growth.

 We hope that 2010 is a banner year for all of you. We wish you all health and happiness in the upcoming year.

For quite some time you have heard our mantra for Exclusive Buyer Agency.  We represent only Buyers and never take listings. We believe that in the Traditional Real Estate offices there lay an inherent conflict of interest. If you pass a property and see a Real Estate sign you may be tempted to call and get further information. Remember that this person has a signed contract with the Seller of the home to represent them throughout the selling process.  How could they possibly represent you in the same transaction? The answer is simply that they cannot! They may legally circumvent the process by calling themselves a Transaction Broker and claim to represent neither party and just facilitate the transaction. But since they already have a signed contract with the Seller and have spent a lot of time and energy understanding the Sellers motivation for selling the property, can they simply throw up their hands and say “time out� I now won’t represent either in this transaction? How would you feel if you were the Seller and had divulged to someone who you assumed would be your fiduciary in this process. Or as the Buyer who is the newest member to this relationship. Can a Listing Agent simply forget about the relationship that they have established with the Seller and give fair and impartial dedication to both parties?   The Buyer Agency is more than just a business model or a cute niche marketing concept. Quite frankly it has become a movement; a movement has been slow to gain traction but is attracting more and more long time professionals who are accepting the ethical decision to represent only one side. The movement is also attracting attention from various governmental entities. The United States Department of Housing and Urban Development (HUD) produces a 49 page booklet titled: “Shopping for your Home loan�. On page 6 section IV: Shopping for a House, Role of the Real Estate Agent or Broker. Frequently the first person you consult about your home is a real estate agent or broker. Although these agents and brokers provide helpful advice, they may legally be representing the interests of the seller and not yours. You can ask your family and friends for recommendations.

It is your responsibility to search for an agent who will represent your interests in a real estate transaction. If you want someone to represent only your interests, consider hiring an “exclusive buyer’s agent�, who will be working for you.

  I couldn’t have said it better myself. Now that HUD recognizes the significance of Buyer representation the road to taking this movement to it Statutory conclusion seems more and more likely.