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RSS FeedAnother Denver Foreclosure Record |
Posted at Denver Real Estate Blogspot by Judith Clausen
Dec. 5, 2006
Categorized in: Denver Market Info
A significant record has been broken in the Denver area market (John Rebchook, Rocky Mountain News). There have been more foreclosures in the first 11 months of 2006 than there were in 1988 at the height of the oil bust when it seemed like every other home for sale was a HUD (federal Housing and Urban Development) listing. A mitigating factor is that as a percentage of total homes on the market, the foreclosure rate is still lower than it was in 1988. And the Colorado economy today is much stronger than it was then. The unemployment rate in 1988 was 6.4%, whereas today it’s 4.2% (October).
Where is all this heading? Until the high number of foreclosures is absorbed, home prices will continue to fall. The highest rate of foreclosures is in the northeast Metro area of Montbello and Green Valley Ranch, Adams and Weld counties and north Aurora. As noted yesterday, some neighborhoods in the Denver metro area haven’t been affected by foreclosures.
Is it a good time to buy? If you believe, as I do, that values will again rise and you can keep your home without selling for a few years, you’ll do well. But if you’re expecting to buy now and treat your home like a cash cow as buyers have been doing over the last decade, then you’ll be disappointed. Buying a home is a great investment over the long run. In the meantime, it sure beats renting.
What about buying a home in the foreclosure process? If you can find a good home in a good neighborhood for under market value, then it can be a great buy. But be prepared to wait weeks, maybe months, to hear back on your offer. And be prepared to endure a lot of frustration as you wait, not just to hear on your offer, but also to meet all the deadlines including when you get to move in. Give yourself lots of time and have a place to live in the meantime.
I have two clients waiting to hear on their offers. One has been waiting since September 29th when they made the offer. The other made their offer last week, but the listing agent had said it wouldn’t be long before we heard, so they’re anxious, especially since a competing offer came in at the same time. Another client just closed on a property they offered to buy in early October. Before we closed we had changed the closing date three times, causing the buyers to have to change their plans right up till the day before we finally completed the transaction. It’s a frustrating business when you want to buy a foreclosure. Be sure you’re positioned to do so.
