Yesterday we had a good "frog choking rain" in the middle of town. It did not rain so hard up in Briargate, but it was running almost a foot deep and a car width wide in the gutters near Memorial Park, where I was showing property. The photo above was from my cell phone, and does not really tell the story, but I could not get out to my car for a bit because it was so deep. Some of the side streets were several inches deep, as wide as the road! It is easy to forget how fast the rain can fall sometimes, especially during a dry summer like this one.

We were looking mainly at foreclosures, and I was surprised at a couple of them. For $70,000 they weren't so bad. One we saw I think had been a meth lab house, it smelled SO awful, and there little kids playing in the yard in the house right next door. My sinuses burned for hours afterward. I have not showed in this category for a long time, it was kind of a special situation, we'll see what they decide to do.

Speaking of water, I had to replace our water heater this week. The last one only lasted 9 years, and the one before it only 6. I asked the plumbers about such things, and they seem to think it is the cheaper steel they are using. I noticed it was a lot more expensive this time around, and the new one does not appear to have any features the old one didn't have. I ended up buying the unit at Home Depot, and having a plumber install it, total package $840 (including the required permit from Regional Building), which was $100 - $150 less than the phone quotes I was getting. Maybe next time we go tankless? I still see water heaters from some older homes lasting 15- 20 years, some things they just don't make like they used to.

There is no official date that is considered mid-summer, but if there were, it would have to be about now. The hot and dry spell has continued, and Denver is about to have the most consecutive days above 90 in its history. Because of our elevation, we don't get as many, and even the hot days don't usually stay there as long as they have this week, it was still in the 70's at 10 last night.

Hot weather makes me think of mountains, and one popular mountain town near the Springs is Cripple Creek (shown above). Back we were new to the Springs in the early 90's, one of the big issues was how to save the old gold mining towns. They came up with a scheme to allow gambling in a few of them to see if it would work. Well, Cripple Creek, Central City and Black Hawk were the only 3 towns they chose, and it was to be limited stakes gambling. It worked, for the most part, and started a revival of sorts of these towns. Now the great issue is that they outlawed smoking in the casinos, and the casinos are unhappy because revenue is down. We aren't big gamblers, and if we spend $10 on nickel slot machines once every few years, it about does it. With the economy so poor, I almost laugh when they blame it on the non-smoking thing, I am surprised business is not down more, even tax revenues are down about as much. And then there is $4 gasoline. It is a little drive, and many people are being more careful about how much they are driving these days. Not to offend you smokers out there, but I like the new smoke free environment, and my guess is that when the economy picks up, so will their business. Ironically, the increase in the price of gold is also having an effect on these towns, spurring interest in expanding mining operations. The response? Not sure they want that, since the newer strip mining techniques might make the towns less attractive to gamblers. Go figure.

So how come gas prices haven't started dropping with crude oil prices? If gas prices dropped proportionally to the recent drop in crude, I think we'd be around $3.40 / gallon here, and while that is not exactly a bargain, it is better than the $3.90 or so we are at. I guess it is like interest rates, they go up easier than they go down, and there is not always a lot of rhyme or reason to them.

I thought I'd talk some about home inspections today, as I am in the middle of hashing out agreement on some inspection issues on a house I sold a week or 2 ago.
In Colorado, the contract is very specific about buyers rights when it comes to inspection. If the inspection(s) show anything the buyer does not like, they have 3 options. Either accept it anyway, ask the seller to fix it, or walk away from the deal. When the buyer asks for things to be fixed, the seller does not have to fix it, in which case the buyer either accepts the house as is, or walks away.
I for one do not like to see deals die over inspection issues. I've seen some silly stuff, where the seller feels they don't have to fix things because the buyers got "too good of a deal", or "the prior seller wouldn't fix it for us", or "we didn't care that it leaked, why should they", or "we never got cancer from radon", or "the seller of our house we are buying wouldn't do it" and on and on.
In Colorado Springs, we normally get an ASHI or NAHI certified (not licensed, there is no license for home inspectors here) inspector to do a general inspection. It typically costs between $250 - $300, and the good ones do a very thorough inspection of the mechanical aspects of the property, making sure everything works, that outlets are wired properly, roof, siding and window conditions, etc. Radon is an issue here, we generally recommend radon testing ($100) if there is a basement, if there is no basement it is not as common to test for it. Termite inspections are only done if there is some evidence of wood destroying insects. While they do exist here, termites are not very common. Occasionally a structural inspection is called for if there is evidence of problems found by the general inspection.
There are a couple of principles that I think should make this process more civil, and although not all buyers, sellers or other agents may agree, I wish more would consider it at least.
1. If you see inspection issues before you write the contract, include them in the contract, or at least alert the seller when writing the contract. It is risky to assume the seller will fix something that is obvious and unsatisfactory after the contract is accepted, since they are assuming you are ok with those items that are obvious.
2. The 3 S's, Safe, Sound and Sanitary. If an item falls into one of these categories, it is generally a reasonable inspection item to ask for. Buyers, inspection is not Christmas shopping, you are not looking for ways to improve the property over what it is, or otherwise figure out how to enrich yourself at the sellers expense. Strictly cosmetic items should be off limits, unless they are damage that occurs after contract. I like to think of most of the inspection report as a "honey do list" for the buyer after they close, since all homes have normal maintenance items that are somewhere in the middle of their cycle.
3. The Golden Rule. Do unto others as you would have done unto you. If you would not want to buy a house with a leaky water heater, don't ask your buyers to. But vise versa, as a buyer, if you know you can take care of some of the issues easily yourself, you might not want to trouble the seller, who may be stressed out of their minds with other issues.
4. Materiality. Some requests are maybe in a grey area, but if they aren't expensive, and they make the buyer feel more comfortable with the process, in a buyers market like today, the seller should be considering doing the request anyway. It works the other way in a sellers market, the buyer should consider carefully any requests they make that send the seller looking for another buyer.

It has been hot and dry, so I got started in sanding and staining my deck this weekend. I finally broke down and installed the window AC unit in the master yesterday, I have to say that it was nice, given it was still 75 degrees or so at 10 pm last night (that is unusually warm here). It is beautiful, clear and cool (60's) this morning, like it is most mornings in Colorado Springs in the summer.

Finally some real rain! We had a very nice thunderstorm this afternoon, and it feels like more to come this evening, so maybe we'll get back on track for the summer monsoon pattern that most of us love. In addition to the welcome cool off at the end of the day, the rain really greens things back up, and it has been too much of a brown summer so far.

I love mid month closings (actually, in this market, I'll take closings any time of day, any day of the week, any week of the month!). Our closing this morning was only 25 minutes, and on a VA loan no less. I know part of the reason was that the seller had previously signed off, so it was a "buyer only" closing. It was also quick because Sally Shelton, my closer at Peoples Title, is the fastest and best closer in the business. But mid month closings are usually quicker and smoother , because things aren't as hectic, the lenders tend to do a better job getting figures done, everyone is a little more relaxed, everything just seems to go smoother. I was representing the seller, and was a bit sad to see her go, as she and her former room mate had been clients for close to 10 years. The buyer got a great house for the money.

Today's photo is from a thunderstorm last summer, taken in our neighborhood. I love what the clouds do when the storms roll through.

Mortgages are still pretty available, despite all the commotion in the financial markets. Ironically, it might actually bring rates back down if this keeps up (although we are in the low 6's now, which is pretty good). With the stock market at such low numbers, it usually brings money into the bond market, helping rates.
We still have some pretty good programs too. I talk a lot about FHA, because with only 3% down, it goes all the way to $325,000, which buys a pretty decent home here. With 5% down, conventional loans go all the way to $417,000, which even includes some of our nicer new construction areas. And for jumbo loans (over $417,000), Wells Fargo has a program that allows you to combine a smaller 1st mortgage with a purchase money 2nd HELOC that avoids the stiff penalties of going to a true jumbo mortgage (although this is a 20% down program).
Last week we got a briefing on the new Sanctuary in the Pines development in D20 Black Forest. One of the signs that our market may be getting closer to a turnaround is new developments like this. Although prices will be starting in the $600's pretty much for completed homes, these are 2.5 acre wooded lots in D2o, on a community water system, which is a first. I think this one will be a winner.
Another sign that things may be turning around is the supply of "spec" homes keeps shrinking. Last weekend I noticed the list of specs in Cordera in particular was very short. While the overall supply of homes is quite ample, there are definitely pockets where the only choice is start one from scratch. There sure are some great deals out there in resale homes!

This weekend was a great family weekend for us. We celebrated my son's new job, and our other son and his wife came home from the Aspen area to join us, although just for a quick visit. We caught a movie (Hancock, way better than we expected), and even took a drive up to the mountains for a few hours. Movie theater choices are expanding rapidly here, with a new Hollywood Theater already open at Interquest (Northgate area), and another Cinemark (the 3rd) opening this fall, almost across the street. We still go to the Cinemark on Powers or the Chapel Hills Mall theaters, maybe out of habit, maybe because of convenience.

The weather has been really great, but too dry. We really need some rain, but the temps all weekend barely made it to 80, so it was very comfortable, blue sky weather.

Today's photo is of the buffalo grazing in the distance along Highway 9 on the way back from Breck a few weeks ago.

The constant thrashing in the worlds money markets is not helping real estate sales. At least not here in Colorado Springs. Our market is very "housing cost driven", which means that people are sensitive to the monthly payments required to buy a house. When interest rates jump, it has a dampening effect on peoples appetites to buy, because for the same payment, they can afford less. With the stock market already low, and now Fannie Mae (FNMA, Federal National Mortgage Association) and Freddie Mac (Federal Home Loan Mortgage Corporation) both having liquidity problems, it is going to be interesting how liquidity is going to flow into the real estate market so that buyers can still borrow the money to buy homes. We solve that, and the oil crisis, and "then there will be world peace" :-) Currently rates are still in the mid 6's, which we can probably live with, but it was only last month we were still in the 5's, and I miss that already.
It is hot for the next couple of days here. It started pretty nice (ok, gorgeous) this morning, but 90 today and higher tomorrow is what they say. I don't think we hit 80 before noon, but it seemed to be warming up kind of quick over lunch time. Our overnight temps tend to drop 30 or more degrees from the daytime high, so even hot weather like this is pretty bearable, although I am personally more of a cool weather fan.

Short sales and foreclosures were a major topic at this morning's sales meeting. The context? Discourage your sellers from pursuing these routes. The long and "short" (pun intended) of it, is that there are longer term repercussions in terms of damaged credit, inability to own again for a long time, tax liabilities, deficiency judgments, insurance rates, and even job possibilities being affected by these things. If at all possible, don't do it was the message we heard.

What is the best solution when you owe more than your home is worth, and you HAVE to sell? Find a source of credit to fund the shortage that can be paid off over time after the closing. Especially if the shortage is not huge, usually the result will be a happier future.

The weather has been pleasantly cool and even wet the last few days, with the highs around 80. A big warm up is on the way though (94 on Saturday!), I may have to look for another opportunity to go up to Breckenridge, or somewhere else where it will be cooler! Today's photo is from 2 weeks ago, downtown Breckenridge

Colorado Springs has warmed up a bit in the last several days. We may see 90 again today, although yesterday we went hiking between Divide and Cripple Creek, where it was a nice 74 or so. We took the hike to up to Horsethief Falls. It was not much of a water fall anymore (earlier in the Spring it flows much harder), but a very pleasant, shady hike. We tend to take these kinds of hikes on holidays, because it seems so hard to break loose the time otherwise. It was not super crowded, although in the 3 miles up and back we probably saw 20 groups of hikers.

Barack Obama came to town yesterday, and spoke to a select audience at UCCS, aka University of Colorado, Colorado Springs, or CU Springs. Colorado Springs is not normally a big stop on the democratic presidential "train", and it was interesting that he chose to make this stop at this time, since everyone will be in Denver in August for the Democratic National Convention. This is normally viewed as a Republican stronghold, but who knows how this next election will go? He sure picked the right place to talk about increasing the size of the Army and Marines, although he did not mention the Air Force.

It was great to get some rain yesterday. It never really got very hot, and the rain was very refreshing and much needed. Maybe the wildflowers will finally come out. Today is supposed to be pretty nice, and maybe even some more rain before a scorching hot weekend. I don't think we have actually really gotten to 90 degrees yet, but Sunday is supposed to get to 94!

Today's photo is from Snowmass, taken last June.

Independence Day, 4th of July, whichever you want to call it, it is a great holiday in Colorado Springs. Some of the surrounding small communities still have little parades with kids on bikes and toddlers in wagons. The "big show" in Colorado Springs proper is the Memorial Park celebration, complete with the Colorado Springs Philharmonic Orchestra free concert, and a fireworks display that opens with a battery of howitzers from Fort Carson, as part of the 1812 Overture. Other area fireworks displays are at the Air Force Academy, Fort Carson, Palmer Lake, and Manitou Springs (though I heard they were cutting our fireworks for fire danger reasons this year). We will be spending the 4th with a large group of old friends.
Part of the reason this is such a big holiday here, is the number of active duty and former military personnel. One study puts that number at close to 21% of the adult population. Certainly with 5 military bases (Air Force Academy, Peterson Air Force Base, Shriever Air Force Base, Fort Carson, and NORAD), Colorado Springs has a strong patriotic feel to it.
With the oil crisis, continued problems in Iraq, a housing and automotive recession, rising unemployment, the stock market tanking, fires burning all over the West (especially California), floods in the Midwest, and on and on, it is easy to forget how great life really is, especially for us in the United States, and even more especially for us in Colorado Springs. I'm hoping to make this 4th of July Thanksgiving Day, in addition to Independence Day.
Today's photo is from late last June at Independence Pass, just east of Aspen. I tend to associate it with the 4th of July weekend, because we spent the 4th up in Snowmass with our son a few years ago, and really enjoyed the scenic beauty of this magnificent pass over Highway 82. It is closed for 1/2 the year because of snow, and when it opens, takes an hour off the drive from the Springs to Aspen / Snowmass.

Official July statistics for Colorado Springs real estate sales won't be out until after the 4th of July holiday, but preliminary figures show that while our sales continue to be anemic, some good news has started with prices and supply. Prices have been rebounding since December, and both the average and the mean price have increased to $256,824 and $222,000 respectively. The percentage of distressed units has dropped sharply, to 17.65%, from a high of 26% in February. It remains to be seen whether this is a trend or a blip, but I have felt for a while now that the percentage of distressed units has been drag on prices. The inventory of unsold homes has dropped almost 4% since last June.

We have some new clouds on the economic horizon, with Hewlett Packard announcing they will be shifting employees from some Colorado Springs operations to New Mexico starting next year, and to Ft Collins. The Fort Collins folks may take the transfers, as there are some great lifestyle issues to be had in Ft Collins, but the New Mexico transfers will not be as popular. We'll see how it shakes out. By then we should be seeing more returning troops to Ft Carson from Iraq.

Today's photo is the Blue River from downtown Breckenridge along the river walk. Today will be the hottest day of the year so far, around 90, and the I always think of the cool mountain air and ice cold waters of the mountains on days like this.