Summer Statistics

Summer: the 4th, lots of sun, and maybe afternoon rain should the clouds gather moisture from the mountains and as they move over the Front Range they hopefully get tired of carrying the wet and dump it on us.

A good month to talk about some local statistics and local market guesses.

As you know, rates are up, over double from last summer, and maybe also know, or can guess, that residential real estate sales have slowed. Most houses listed in May, if not sold right away, have seen price reductions. Its has been difficult to price listings these days as agents wait for recent closed sales data. Even though rates have been climbing for many months, it seems like May was when we saw a slowing begin. However, there is lots of good news for Denver when we look at growth.

Denver added close to 100,000 jobs last year, many from firms from California, bringing totals back to the highs before COVID. Continued job growth puts pressure on wages and they have been climbing. The trends suggest Denver will add 22,000 new households this year, highest in the last 20 years. Also for this year, Denver is expected to add 50,000 jobs and median household income will top $110,000.

Denver’s tech sector continues to grow and now the median household income is above all metro areas beside the Bay Area and Washington D.C. Our median age lands 1.6 years below the national average which promotes demand in the 20-34 age group for apartments. Class A (nicest) apartment demand is up and is bringing all other units along for the ride. As can be expected, central Denver apartments rent the fastest and for more money than the suburbs, with RiNo and Five Points being popular due to proximity to modern lifestyle locations like restaurants and bars. SE Aurora is the only area with vacancies over 4%.

In 2018, the busiest year for apartment construction in a while, 10,500 units were added and the tally in 2022 will be less, but not by much, with most units being built in RiNo and Five Points. Vacancies are thought to drop to below 2.9% this year, the lowest in 20 years, even though rents increased by 17% in 2021. Rent increases will be slower this year but again, not by much. The last two year average came close to 12% per year.

Wondering why all the growth? Here are some reminders:

CITY OF DENVER NOTABLE RANKINGS

#14 BEST PLACES TO LIVE

(U.S. NEWS & WORLD REPORT 2021)

#6 BEST SPORTS CITY

IN THE U.S

(WALLETHUB.COM, 2021)

#2 HEALTHIEST COUNTY IN THE US - DOUGLAS COUNTY

(USNEWS.COM, 2021)

11TH BEST PERFORMING LARGE CITY

(MILKEN INSTITUTE, 2021)

#9 IN THE US IN TECHNOLOGY TALENT

(CBRE REPORT, 2021)

#1 FOR ECONOMY IN THE US

(US & WORLD NEWS, 2022)

3RD BEST PLACE TO LIVE IN COLORADO

(USNEWS.COM, 2021)

4th BEST PLACE IN AMERICA FOR BUSINESS & CAREERS

(FORBES, 2019)

12TH FASTEST GROWING METRO AREA IN THE U.S.

(US CENSUS, 2020)

#12 TOP CITY FOR YOUNG PROFESSIONALS

(NICHE.COM, 2022)

4TH MOST DESIRED CITY TO LIVE FOR COLLEGE GRADS

(AXIOS, 2022)

Salt

“Back to the salt mines.” My dad used to say that when we went to work and I often wondered what a salt mine was like.

Today I am writing about it. What got me interested is a book I have Salt Fat Acid Heat by Samin Nosrat, which is a really fun cookbook subtitled “Mastering the Elements of Good Cooking.” So I am sharing a few thoughts from that book and other sources.

Salt is essential for life and saltiness, along with sweetness, sourness, bitterness and savoriness, is a fundamental taste. And humanity has a long history of finding and using salt. Ancient processing sites have been discovered in Romania and China dating back to around 6000 B.C. Salt comes from evaporating sea water or mining, and until the industrial revolution, mining was one of the most dangerous jobs because of dehydration from breathing salt dust and having it on the skin, so prisoners and slaves did most of the mining. Salt was prized in ancient days as a food preservative, along with needing it to live, that at times it was more valuable than gold, and was brought by caravans over long distances to areas that had no salt. Today salt comes from evaporating sea water or mining ancient dried sea beds and there are mines throughout the world, some very deep, and here in the states, in places like Grand Saline, Texas and Saltville, Virginia.

Below you will learn something about salt and food, but one quick note from the internet: Sodium chloride (salt) has many industrial uses, like being the source of chlorine or used in making plastics, and only 3% of production is related to food and eating.

We need salt to maintain proper blood pressure, for our nervous system, muscle movement, and nutrition delivery in our bodies! We cannot store salt internally so we need to eat it. Ms. Samin says ”We are hardwired to crave salt to ensure we get enough of it…. Salt makes almost anything taste better, so it is hardly a chore to add it to our food.”

According to the author, there are 3 main types of salt we use in cooking: common table salt, kosher, and sea salt. Table salt is the finest and most dense and is what is in your saltshakers. Because it is dense, it is the saltiest, and may be twice as salty as other types (so use less). Avoid added iodine because it can taste a little metallic. If you need or want iodine, then look up natural ways to get it, like in dairy or seafood. Kosher salt: this salt has no additives and the two main brands are Morton and Diamon Crystal and because they are processed differently Diamond is less salty than Morton, and dissolves twice as fast as table salt, which is helpful to know when you are salting your food to taste. Sea salt: two types are refined or natural. The latter is processed through slow evaporation (years) vs. boiling sea water in a vacuum. Natural types are more labor intensive to process and so cost more.

So back to taste. Salt affects flavor, which is a combination of taste and aroma (what we smell). We can taste salt, but it also releases aromatic compounds in food, helping us smell, and increasing the pleasure of food and eating. It also reduces bitterness and increases sweetness. This makes sense now as to why I like my wife’s chocolate chip cookies when she sprinkles some kosher salt on them!

From the book “This flavor unlocking is also one reason why professional cooks like to season sliced tomatoes a few minutes before serving them so that, as salt helps release the flavor molecules that are bound up within the tomato proteins, each bite will taste more intensely of tomato.“ Try this with some grapefruit juice: take a sip, and then add a pinch of salt and see if you think it becomes less bitter and more sweet!

Let’s go eat something.

Cheers,

Dan

The Big Bang

We’ve all heard about it. Something like the Universe starting from a very small point exploding and

creating space. Today I want to share some history of the discoveries that corrected ideas prevalent

for centuries, starting with Aristotle back around 500 B.C.

Astronomers had a few theories about how the universe “is”, among many ancient creation myths too numerous to mention here. The more accepted theory was called the “Steady State”, which meant the universe always has been and will continue- time is infinite both in the past and in the future. Einstein started to make waves with his equations published in 1911 that stated that light was affected by gravity and these equations suggested that the Universe was either expanding or contracting, neither of which he liked. But was light affected by gravity and could it be proved? Then in about 1919 a British researcher traveled to the coast of Africa to view a total eclipse of the sun to measure the location of several stars on the opposite side of the sun during the eclipse and found their position shifted from known positions and thereby proved the star’s light was indeed shifted by the sun’s gravity. Then in 1922 a Russian physicist worked Einstein’s equations to show that an expanding universe was perfectly possible and in 1927 Father Lamaitre proved those equations required an expanding universe and not a collapsing one. He went on to say that the universe started at a point, called the “primeval atom” of infinite density and heat where the laws of physics were unknowable. Einstein and most physicists disagreed but were subsequently proved wrong, to which Einstein commented that his thinking was the biggest blunder of his career. Nice to know that someone like Einstein can be wrong!

Around the same time Edwin Hubble and his assistant was observing the universe and discovered that the Milky Way was not the whole universe, as was thought at the time, and that little blurry objects were not Milky Way stars but separate galaxies! And then in studying these galaxies determined that they were speeding way from us and each other, like dots on an expanding balloon. This showed that the universe was expanding and became one of the biggest discoveries in history. Also, they were not only speeding away from us but were accelerating at the same time. They determined this by the “red shift” of the light from these galaxies and to keep this blog from becoming too long, I won’t write about here but encourage you to read up on how we can determine the speed of something light years away.

Newton started this understanding with his amazing experiments on light and we now can know so much about our world from studying light.

The last vital proof of the Big Bang happened in the mid 1960’s. Princeton physicist Bob Dicke said that right after the bang all the new tiny universe was super-hot and wondered where all the heat went. As it all cooled the heat was trapped in the universe and the heat would produce gamma rays that had cooled into radio waves and would still be present. Long story short, a team at Bell Labs had a radio antennae for their research and always had an annoying “hiss” that their antennae was picking up. After trying desperately to get rid of the hiss, even to washing the bird droppings off their big dish, they read a paper proposing the existence of background radiation from the radio waves that came from the cooling off of the gamma rays and realized they had discovered it. It was the Big Bang billion degree heat that cooled to 2.7 degrees above absolute zero, and it was everywhere. Then in the 1990’s NASA’s COBE satellite found that the radiation was in clumps that showed that there are aggregates of matter that formed the stars and planets and everything else.

The Big Bang: when time and space started about 13.8 billion years ago.

References:

A Brief History of Almost Everything, Bill Bryson, c.2003

A Beautiful Question, Frank Wilczek, c.2015

Is Atheism Dead?, Eric Mataxas, c.2021

Inflation Confusion

The “I” word is mentioned everywhere these days. Print, talk shows, neighbors talk about it, and we are  all bracing for it to be a long haul. In my world , besides food and gas increases, interest rates are now  2%+ higher than 9 months ago. A brother of mine in Montana who is a residential contractor told me a  few days ago that a 2x6 board costs $14 and 2 years ago they were about $6. 

And the experts did not see any of this coming… I suppose like the 2008 crises. Inflation ended 2021 5%  higher than the forecasts predicted in the U.S. Also, this time inflation is global- over 5% in 58% of  advanced economies and over 7% in 55% of emerging ones, according to the Bank of International  Settlements. 

Inflation is “mysterious” as Stansberry Research Dr. David Eifrig likes to say. Certainly supply chains,  pandemics, and wars contribute, but “the root of all inflation issues Is that inflation is baked into the  global financial system as long as paper currency has been used”. And we now live in a money printing  world. In 10th century China credit notes were printed when the demand for coins exceeded the supply  of metal to make them, and money printing was invented. Now, new digital or printed currency lowers the value of all existing dollars. Certainly, supply and demand are factors, but the trillions added to the  money supply reduces the value of the dollars in your pocket. The result begs the question: is my house  really worth 20-25% more than it was 2 years ago? 

And every country’s currency is losing value too. 

Another piece of info that is telling is the US’s percentage of debt to GDP (gross domestic product_- which compares what the government owes vs economic production. Now we are at 123% as of the  fourth Q 2021. We owe more money than we produce, and we went over 100% in 2012. This impacts  what middle America’s financial condition is, as now almost 2/3 of American’s live paycheck to paycheck, and higher inflation will cause more folks to live on a financial edge. And then growth is  slowing too, certainly through the end of this year. The Atlanta Fed lowered their growth estimate to  0% for the first quarter. Consumer sentiment also continues to decline. 

What to do? Consider: pay down or off debt- especially consumer debt, own hard assets like real estate,  precious metals, and other tangible assets, owning shares in well run businesses that sell products that  are essential-like food and fuel, and boost savings as much as we can. Remember, by paying down some  debt frees money to pay down other debt, which is a form of compounding, just like the interest you  earn on investments. The old Rule of 7- a dollar invested at 7% doubles every 10 years, and a dollar  invested at 10% doubles every 7 years.

Time is Precious

“What then is time? If no-one asks me, I know what it is. If I wish to explain it to him who asks, I do not know.” St Augustine

“Time is what prevents everything happening at once” Ray Cummings

“Time is what clocks measure”

Time

I try to read a lot of books. Some are page turners, like Lee Childs’ Jack Reacher series and other detective fiction, and some history, and science books, especially physics and biology (written for the layman, like me). Recently I read Frank Wilczek’s Fundamentals, Ten Keys to Reality and he has a wonderful chapter on Time. He is a Nobel Prize winner and writes a very readable column in the Wall Street Journal, which is where I discovered him. This blog shares some thoughts found in that book and Matthew Hutson’s review of the Clock Mirage by Joseph Mazur.

There is lots of time, and time is short. Not enough time to get our things done, or barely, and billions of years of time in the cosmos. The whole of humanity is but a flash compared to the age of the universe, but some weeks seem to last forever. We can move around in space, both our in our living room, and some have moved in outer space. But we cannot move around in time.

Frank says that “time is the drummer to which change marches”. There are cycles in everything- night and day, seasons, the moon and earths orbits, the sprinklers in our yards, which repeat. Then there is music and its beat. We sing and dance to the passage of time, and different time signatures. If we cannot share the same rhythm (time), then we cannot share fully the same song, at least enjoyably! And the passage of our lives represents time, our growing up and developing at pretty similar rates between people. Said a different way, “Time is what clocks measure, and everything that changes is a clock.”

Measuring time is what we do. Whether it is our watches, or calendars, or written history, and planning ahead for events. Someone thought up our years to be labeled B.C. or A.D. just so we could have a history, or at least know more about it, like “when”. We read about history and might enjoy certain events, but we like to know when they happened. It helps us know that they happened at all in some ways. Like if we know when, then maybe it helps us know it really did.

We can measure ancient time is through radioactive dating so we can know more about civilizations by know when they happened. We all have heard about that kind of dating involving an isotope of Carbon (Carbon14). And the discussion of how it works is too long to go into here, but if you have a few minutes sometime, look up how it works. It is fascinating to know that even the atoms in our bodies, and ancient bodies, keep track of time. And through the orderly decay of certain of those atoms we can guess when the Neanderthals lived, when the Egyptians lived and flourished. For older dating, we can use uranium or lead isotopes, or other elements that decay on specific time frames. From this we can infer the age of the Earth, 3.6 billion years, which makes up about a quarter of the age of the universe.

But getting back to clocks, Mazur writes “to measure time there must be something to count” and basically says that clocks do not measure time but count events that have a relationship to time. Time measurement has been around a long time- sun dials and hourglasses, among other methods, and then Galileo and others developed pendulum clocks which were used until the 20th century as the best in accuracy. Then pendulums and unwinding springs were replaced by vibrating crystals, and then for the most accurate: vibrating atoms, which is what atomic clocks are based on. These clocks are super precise with estimates of losing a second or two in a million years. This accuracy is used in the Global Positioning System(GPS), for instance, which I have always wondered how that system works.

And then Einstein comes along and says it is all relative and developed the idea of space-time wherein time is affected by velocity and by gravity, at least on a cosmological scale, and who knows where else. Scientists have been able to verify his theory that time depends on the position and speed of the viewer and that being measured. So what we thought was a kind of absolute, turns out to be variable in certain ways. The speed of light seems to be the only absolute left, but that may change, or has already.

Certainly our perception of the passage of time seems relative, which means it is influenced by perspective. Waiting for the beach vacation to get here takes forever and on the plane ride home I wonder where the week went. And we all talk about how it seems to speed up when we age.

Time is
Too Slow for those who Wait,
Too Swift for those who Fear,
Too Long for those who Grieve,
Too Short for those who Rejoice;
But for those who Love,
Time is not.

Henry Van Dyke

So since our time is precious, let’s try and remember to value it, and our friends and families and other people that travel our time with us.

Oh and say a prayer for Ukraine.

Best to you and yours,

Dan

Let's Learn About Dogs' Noses

I thought I would write about the real estate market, or the Fed and the upcoming rate hikes, but that news is everywhere….

so to keep it interesting here is another digression from the financial world I work in:

Let’s learn about dogs’ noses!

We all know dogs have some amazing senses from which they get around in their world. Many of my clients have or have had blind or deaf, or partially so, dogs and they report that it is surprising how well they get around. Research is now suggesting that dogs have infrared radiation sensors in their noses!

Helen Czerski, in her wonderful Everyday Physics column in the Wall Street Journal provides some fascinating information. Our sense of temperature is dependent on our skin, and we pretty much have to touch something to find out about an object’s temperature, except maybe for a fire and its intense heat, or when we stare into our freezer wondering what to make for dinner. In the case of the fire, the infrared radiation heats up our skin. I wonder what is physically happening when we stand in front of the freezer to cause us to feel the cold in addition to the fact that our skin feels the lower temperature.

In physics there is a law that says anything warmer than absolute zero degrees ( -273C) loses energy by emitting photons of light, or electromagnetic energy, which are at frequencies different than visible light, so we cannot “see” the photons. Unless, of course, the object is very hot. Everything is always losing heat and emitting photons.

So, if you wanted to detect that radiation with an instrument the best way would be to have it colored dark so it would absorb light better (remember light is radiation) and cool, to have the biggest temperature difference from the object radiating the heat that you want to detect. I remember talking to my father-in-law, who designed infrared detectors for Boeing to be put into aircraft and the instruments were bathed in liquid nitrogen (- 320 degrees F, -196 degrees C) to help it be super sensitive to heat sources on the ground.

Anyway, back to dark and cool…. Think of a dog’s nose! Researchers at Lund University in Sweden have published findings that show that dogs can detect, from 5 feet away, a difference in temperature between 4 inch sized objects at room temperature and body temperature. The cold black nose absorbs the small amount of temperature difference and their nerves inside the skin can signal to their brains that a warm(ish) object is nearby.

Another amazing thing the research mentions is it appears that the dog’s nose warms up when it is sleeping and cools down within 15 minutes of waking. I guess the dog ramps up its instruments!

I remember learning that snakes, and maybe other reptiles, have infrared sensors in their heads. Maybe to either find warm prey, or a sunny rock on which to lie. Perhaps being cold blooded helps too.

So next time a dog’s cold nose touches your skin you can remember there is more there besides a very good “smeller”.

Champagne History

Happy New Year!

It is fun to be writing again to you all after taking a few years off from sending out (hopefully) interesting paragraphs on subjects about both mortgage market intel and other topics.

I trust we will all experience a little more freedom in the New Year! Reminds me of not missing something until it is gone, or at least confined in some way.

And so to commemorate and celebrate:

Champagne History

Historian Amanda Foreman wrote in the 12/9/21 edition of the Wall Street Journal about this topic and I share some interesting points.

In 1891 with the Treaty of Madrid only sparking wines made in the Champagne region of France could be called champagne. Personally, I am at fault frequently because to me they are all “champagne”. In going to the liquor store I noticed the French champagnes start at about $50 per bottle (they just don’t last that long when I open them) so I drop down a few shelves to buy Italian Prosecco or American sparkling wines.

Anyway, there are sparkling wine references in many ancient writings, especially Roman, who added grape juice to wine to promote secondary fermentation. As you might imagine the pressure in the container would crack if sealed, or split wine skins, or release the pressure and so the bubbles would escape and not stay dissolved in the wine, eliminating the effect. So bubbly wine could not become readily available until the 1600’s when British scientist Christopher Merret brought re-fermentation into the public eye with his research and wine merchants had the benefit of British glass being stronger than French glass.

Notable names we may recognize:

Dom Perignon; cellar master in NE France from 1668 to 1715 who worked on creating fine still wines, not sparkling, stored in barrels.

Madame Clicquot; in 1811 created sediment free champagne and became wealthy exporting to the Russians (apparently the French preferred still wines).

American Nicholas Longworth: American wines developed with the discovery of the Catawba grape and Longworth, being rich already, became the Father of American “champagne” and by 1850 had shipped 60,000 bottles out of the Ohio River Valley.

The sparkling Catawba wine success dwindled with the Ohio climate rotting the vines and the Civil War stealing manpower, among other things.

The French had a bigger problem with a vine killing insect that crossed the Atlantic in 1860 and decimated the French vines and the Champagne region faced extinction until the French allowed the American rootstock of vines to be grafted onto French grapes which saved the vineyards. Apparently the American grapes were resistant to the insect killer.

To quote Amanda: “Champagne may have its heart in France, but its brains are British, its strength American, and its origins Roman. Cheers to one and all.”

Tax-Free Retirement Income

Are you aware that a health savings account could be used as a source of tax-free income for retirement? Saving for medical costs, a major expense in retirement, is necessary and an HSA is a vehicle for that. An HSA offers more tax advantages than either a 401(k) or an IRA and may be used to generate tax-free income in retirement.

Federal and state tax payments are not required on savings in an HSA. The money you deposit grows tax-free and may also be withdrawn tax-free when used, now or in retirement. Therefore, experts recommend contributing the maximum allowed to both an HSA and a 401(k). For those with limited funds, first contribute to a 401(k) for the company match (if they offer one), then to an HSA until able to save more.

Here's where it pays off to get creative. One option is to choose a high-deductible insurance plan with lower premiums, freeing up money to contribute to an HSA. Perhaps driving an older, paid-for automobile would free up money for this. Grab coffee or your beverage-of-choice and brainstorm ways to free up money to meet future needs; make a contest out of it! If the thought of retirement is worrisome, act now to alleviate deficits later!

This plan reaps the greatest benefit when the money saved compounds over time if it has not been used on medical expenses now. That money would then be available for medical needs during retirement. All the taxes that would have been paid are not withheld on HSA contributions so that more money is available to use for future medical bills.

Extra tax advantages of an HSA allow for greater savings for retirement than later withdrawing money from a 401(k) and paying taxes at that time, while also increasing take-home pay now. It is important to understand, however, that money withdrawn from an HSA must be used for qualified medical, dental, and vision care expenses or for certain Medicare premiums or partial payment of long-term-care insurance premiums. If used for other expenses, income tax will be owed, along with a 20% penalty if under age 65. Consult an expert for details and the best course for your situation.For more details, see article "How to Get Tax-Free Retirement Income" by Anne Tergesen, The Wall Street Journal, 11/13/17.

Get thinking outside-the-box!

Why We Think of Stars as Pointed

Are Stars Pointed?
 

As children we learned to draw star-shapes, wanted to earn a gold star, and sang “Twinkle, twinkle, little star”. Our connection to the stars in the night sky caused fascination and encouraged imagination. Yet, how many of us have stopped to ask why we think of them as having points (except for Van Gogh in his painting “Starry Night”).

Recently I read an intriguing article by Helen Czerski (WSJ, 3/9/19) about this phenomenon (https://www.wsj.com/articles/do-stars-really-have-points-11551884238 ) which clarifies this mystery. Stars appear as tiny dots, being so far away that their true shapes, really spheres, as we all know, cannot be seen. However, photographic and telescopic images portray them as having points or spikes, just as images of other lights often do. Photography accounts for the spikes and the star-shaped association. This camera construction creates points on images of light sources. A camera’s aperture, through which light passes to create a photograph, must move apart or together easily, and as such is generally a hexagon or octagon shape.

Seeing pointed star images is evidence that light has wave qualities. Quantum mechanics evidences light has particle qualities also, but that is a different story. Anyway, stars are spread out by the flat faces of a camera’s aperture into lines, or diffraction spikes. The resulting photos are of stars with six or eight points, determined by either a hexagon or octagon-shaped aperture, accounting for our ideas of the shape of stars.You have probably experienced a similar effect by squinting while looking at stars, outdoor lights, or, for some of us, as seen with blurred vision when not wearing corrective lenses. So, even apart from, or before, photography, those before us observed this effect.
 
All of this makes for a great conversation, and gives us pause to stop and reflect on what we might otherwise assume or take for granted, and truly wonder at the world around us.It is also wonderful to consider the construction of our own irises and how perfectly they are made.

Here's to looking up!

10 Tips For Buying In A Hot Market

If you are currently trying to buy, or are thinking of buying, you have undoubtedly heard how hot the housing market is and how difficult it can be to find a home.

Why is this? Several factors: a stable economy, population growth, growing popularity of Denver, Millennials entering the hunt for a home (America’s largest generation), low unemployment, low inventory, and current homeowners are staying put on average almost double the time as a decade ago.

Before the housing bust, people were moving every 4-6 years into new homes keeping a steady flow of houses available for purchase. Now, the latest data shows us people are staying in their homes on an average of 8.6 years. People are weighing the cost of moving since inventory is low and the process is slow, and if they will have to trade in their low interest rate for a higher one.
 

The meat and potatoes of the real estate business, people selling and buying from an agent, is changing too. Due to a healthy economy and increase in real estate values, more and more people are deciding the keep their current homes as rentals and buy a new home for themselves. Although this is a great investment move, it is taking a toll on the inventory in the market.

So how do you get a leg up on the competition when it comes to buying? Here are a few tips that will help you become a more prepared and attractive buyer in a seller’s market:

1. Plan early and often

   • Home buying is a process and the more you plan ahead, the more money you will save in the long run. Get with a lender to check your credit scores and work on getting them as high as possible.

2. Get educated about the best loan program for you

   • There are many different programs out there that can benefit you, even if you aren’t a first time home-buyer.

   • For example, if you have good credit, a 3% down conventional loan might be a better deal for you than choosing an FHA loan

3. Gather the biggest down payment that you can

   • Sellers seem to be more attracted to larger down payments as well as conventional loans vs. FHA

4. Get pre-approved

   • When you make an offer, agents and sellers alike want to know if you are pre-qualified for a home loan, and even better yet, pre-approved. This process isn’t hard, just sit down with your lender who will get specific details from you about income and debts etc. and from there, they can send your agent a letter of your status to include when you make an offer.

5. Be flexible on the parts of town

   • Because of low inventory, you will need to look outside your favorite one or two neighborhoods. Take into account what the longest commute to work you are willing to drive is and search everything in between.

6. Be flexible on taste

   • Because of high prices and low stock, you will probably need to adjust what you want in a home. Don’t be intimidated by ugly carpet and cabinets. Asses that getting into a home that you can change to your liking over time is better than not getting into one at all or spending more later as prices continue to rise.

7. Be prepared to act fast in making an offer

   • As soon as something comes on the market, the quicker you can see it the better, and the quicker you can make an offer the better. It is not uncommon in the Denver metro area for properties to only be active for 24-48 hours before the seller has accepted an offer. In this hot market, buyers often times don’t have the time luxury to mull things over like they have had in previous years.

8. Don’t be discouraged if it takes 3-8 offers to land a sale

   • It should be expected that most properties for sale will have multiple offers and so more than likely it will take you putting in offers on multiple properties. Talk to your realtor about ways to spice up your offer also. Common ways seen today is adding an escalation clause, appraisal waiver, cash offer etc.

9. Plan ahead with your landlord on lease flexibility

   • If you are renting and trying to buy something, working around when your lease is up can be very difficult, especially if it takes 3-6 months to find a home to buy. Talk with your landlord about maybe going month to month or what the cost of breaking your lease would be.

10. Be patient and embrace the process

    • In such a crazy market, you need to mentally prepare yourself that buying a home will most likely take a while. You could start looking, find a place, make an offer and get the keys to your new home in 45 days, but than likely this will not be the case. It could take several months to get an offer of yours accepted and the deal could still fall through if you aren’t comfortable with the inspection results, or appraisal results etc. Remind yourself once you do go under contract it usually takes an additional 30-60 days to close your loan and get everything squared away before you are handed the keys. Remember, it will be worth it in the end! Hang in there!

If you have any questions about the current housing market, loan process, or what you can do to be more prepared, feel free to give me a call and I would be happy to give you some advice!

Dan Hagstrom

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