Links: Seven

Recent links worth checking out:

Another blizzard is looming in Colorado. Time to get more DVD’s.

Christmas

Christmas is upon us. Seasons Greetings. Happy Holidays. Whatever you call it, celebrate it. When I was much younger I remember getting into an argument with an ethnic co-worker when he took offense to the whole idea of Christmas.

Rather than argue with him, I asked him why he felt that way. He went on to tell me that it’s not right and not fair. Wanting to know more, I asked him what’s not right and what’s not fair. He went on to tell me that everywhere he went there were lights and trees and wreaths and poinsettias and Christmas music. Go on I asked. He went on and on about how Christmas was literally shoved down his throat.

I told him I understood because it’s shoved down my throat too. Stores hit you up with Christmas displays as early as September. The newspaper ads and the commercials on television don’t market Christmas they market buying stuff. Christmas should be simple. I prefer a tree with old fashioned ornaments not the one’s you buy at Hallmark. I prefer to buy gifts for people and not expect anything in return. I also prefer to buy thoughtful gifts and not gifts that someone says they want because the expression on that person’s face is priceless when they receive something they didn’t expect. I prefer time with my family. I prefer watching the old school Christmas classics like “Rudolph the Red nosed Reindeer” and “A Charlie Brown Christmas.” Last but definitely not least a Christmas Eve church service. In the end I want Christmas to be the way it was when I was a kid.

He questioned me about why I never mentioned Jesus. I told him I just did. Keeping things simple. Giving. Spending time with my family. Church service. Last and definitely not least, we walked away friends.

You’ll get snow and like it!

The Christmas blizzard of 2006 is now over. According to the National Weather Service, the Denver area was hit with 18 – 28 inches of snow with snow drifts measuring 4 – 8 feet. Over 3000 people were stranded at Denver International Airport. As quickly as it arrived, it left just as quick leaving a massive cleanup effort in it’s quake.

Here are some sites that might come in handy:

As for me, although the blizzard aborted my holiday plans, I am grateful for having the opportunity to spend quality time with my family watching the following movies: Remember the Titans, There’s Something About Mary, Planes, Trains, and Automobiles, and Caddyshack.

titans.jpg mary.jpg planes.jpg CADDY.jpg

source: imdb

Boulder = Smart

I came across Parvez Osman’s Boulder blog a few months ago. Parvez is an articulate real estate agent with some of the best insight and analysis on the Boulder real estate market. Recently Parvez blogged about a MSNBC article listing Boulder, Colorado as America’s smartest cities.

With the only NY Jets friendly bar in Colorado (Lazy Dog) Boulder is definitely the smartest city in Colorado!

Top Five Fridays – Christmas songs

Due to the holidays, I’ll be blogging lite for the next two weeks so I wanted to end 2006 with my top five Christmas songs:

  1. Christmas Song (Nat King Cole) – I always feel in the holiday spirit when the Christmas Song is played.
  2. Do They Know It’s Christmas (Band Aid) – This song features various artists from England. It’s a song about starving children in Africa but it’s become a Christmas classic.
  3. Have Yourself A Merry Little Christmas (The Pretenders) – My roommate in college played this song over and over during finals my sophomore year. Despite the overkill, it’s become one of my all time favorites.
  4. Winter Wonderland (Johnny Mathis) – Chances are Johnny’s the best when it comes to singing Christmas music. PUN INTENDED!
  5. Riu, Riu, Chiu (Various) – This is a spanish tune that the Monkees, yes the Monkees, covered during one of their holidays episodes. It’s about the birth of Jesus and it’s very catchy! Check it out:

Mortgage Insurance Tax Deductible in 2007

This hit my inbox today:

The 109th Congress closed its session late last week by passing a tax reform bill, which included a new provision that will provide a significant benefit to your consumers in 2007. H.R. 6111 introduces a new, one-year, itemized tax deduction for mortgage insurance premiums. This new legislation will allow taxpayers who itemize their deductions to take an additional deduction for mortgage insurance premiums paid after December 31, 2006.

Section 163(h)(3) of the Internal Revenue Code allows taxpayers to take a deduction for interest paid on acquisition or home equity indebtedness on the taxpayer’s qualified residence. H.R. 6111 amends Section 163(h)(3) to include language that allows taxpayers to treat mortgage insurance premiums as interest during the 2007 tax year. This treatment only applies to mortgage insurance contracts issued between January 1, 2007 and December 31, 2007, and is only available to taxpayers with an adjusted gross income of less than $110,000.

It looks like no one is grandfathered in, it’s only good for mortgages that are issued in 2007, so if you have an existing mortgage with mortgage insurance, you’re out of luck.

An analysis of the Denver Real Estate Market

house2.bmpMark Twain’s quote “Lies, damn lies, and statistics.” is apropos when discussing the real estate market. Real estate statistics for sales are skewed due to the growth in real estate the past five years. Fueled mostly by low interest rates and overly aggressive loan programs, people of all shapes and sizes bought homes. As rates have gone up and the those loan programs have been deemed “too risky” the growth has slowed. However, the statistics will show that the Denver Real Estate market tanked.

To put things in perspective the real estate market is very similar to the career of Denver Bronco Jake Plummer. Jake has been a steady player who never put up gaudy statistics. The last several years his statistics were better than ever as Jake played at an elite level. This year his play dropped. But did it? On average he throws 15 touchdowns and 15 interceptions every season and this season, if he wasn’t pulled for Jay Cutler, he was set to meet those mediocre statistics.

A thorough statistical analysis should take into account the overall average over time. Recently I came across a blog called the Bubble Buster which presents a complete Real Estate analysis of major cities. The analysis takes history into account. Today they released their Denver real estate analysis:

The Denver economy is continuing its steady recovery following the bursting of the tech bubble. The past thirty years have seen three real price cycles and the beginning of a fourth in Denver. Including one cycle of TWELVE years in which nominal growth was 32.6%, yet real growth was negative 29.4%. Market cycle time periods have varied from the downturn cycle of twelve years to the prior growth cycle of fourteen years.

What I truly appreciate about this analysis is that it takes into account the real estate growth in Denver during the past quarter, four quarters, year, five years and historical average. According to this analysis, Denver has seen an appreciation of .1% in the last quarter, 2.3% past four quarters , 4.7% last year 2005, 17.6% last five years and 6.3% historically.

The analysis is further broken down:

  • Summary

    • Recent declines in sales activity have increased the number of homes on the market. Further sales declines should be expected due to current local market psychology. However, significant price declines are unlikely as the mortgage debt servicing cost has remained steady.

  • Recent History

    • The past five years have seen fair nominal and real price growth. The Denver mortgage-debt-to-income ratio has remained steady throughout the past five years despite a national increase, indicating there should be little to no concern about an Denver market bubble. Consequently, nominal and real prices should be expected to continue to grow at near historic levels if mortgage rates remain at current levels.

  • Price Charts
  • Peaks and Troughs

    • In order to most accurately determine prior market price cycles one must remove the effects of inflation and look at real historical prices. The past thirty years have seen three real price cycles and the beginning of a fourth in Denver. Including one cycle of twelve years in which nominal growth was 32.6%, yet real growth was negative 29.4%. Market cycle time periods have varied from the downturn cycle of twelve years to the prior growth cycle of fourteen years.

  • Forecasts

    • Accurately projecting local prices is a challenging task because so many factors play a part in home prices. Mortgage rates, inflation, job growth, median income, legislation, migration patterns and market psychology are just a few. Additionally, real estate markets rarely have periods in which they achieve average historical growth. Rather, real estate markets have periods of tremendous growth followed by market decline. Consequently, the tables and charts below present three likely scenarios, rather than one definite path.

Good stuff!

Links: Poor Priced Out of Homes

  • The Denver Post has an article entitled Poor priced out of homes which examines a recent report of the rental and housing situation for the less than affluent Denver inhabitant.
  • Zillow is at it again, this time the innovative and controversial online AVM has created a feature called Make Me Move. With this feature you basically broadcast to the world what it will take financially for you to move out of your home.
  • Greg Swann of Bloodhound Realty has added numerous contributors to his blog including Dan Green of the Mortgage Reports. The BloodhoundBlog evolved from a Phoenix based real estate blog to a lively discussion group on real estate. Good reading!
  • How the Light Rail converted Englewood from a drab Cinderella City to upscale City Center is explored in this article by the Real Estate Journal.

Top Five Fridays – Sunday Night Football, why not Pink?

The Denver Broncos were on two of the past three Sunday Night Football games. I’m still shaking my head over NBC’s decision to have “Pink” sing the opening song for NBC’s Sunday Night Football. I’ve got no beef with “Pink” and I probably know one or two of her songs but she’s no Hank Williams Jr. However, it could have been worse. Imagine if NBC tapped these five artists:

  1. Celine Dion: America’s border patrol should give more attention to our neighbors to the north ever since this Canadian infiltrated our radio stations. She makes me cringe.

  2. Clay Aiken: American Idol runner up and runner up in this race.
  3. Ashley Simpson: She’s keeping a low profile. Let’s keep it that way.
  4. (tie) Jessica Simpson or Nick Lachey: The tabloids love these guys, most of America could care less.

I’m not a huge country fan but I think Tim McGraw would’ve been a safe/wise choice.

Getting licensed in Colorado

When Governor Owens has signed House Bill – 1161 into law, it required all mortgage brokers to get licensed in the State of Colorado. It’s quite easy process that required three simple steps:

  1. Get fingerprinted and send in for a background check.

    2. No worries for me, I’m one of the good guys.

  2. Get a Surety Bond in the value of $25,000

    3. Again, no worries for me. The bond company I used, Above All Insurance was local and listed on the Colorado Association of Mortgage Broker site.

  3. Register with the State of Colorado, Division of Real Estate

    4. It was a snap and my license was sent to my inbox within seconds of hitting submit.