REAL ESTATE Insider
A Publication Of The Group, Inc.
Vol. 35, No. 8
September 2011
The right time for real estate investing is right now Current market conditions have created an environment for real estate investors that is unique in the history of the Northern Colorado Market. Record-low interest rates, increasing rents, record-low vacancy rates, and stable prices – the stars are aligned for people who will take advantage of this unique opportunity to build their real estate portfolios. Savvy investors are attracted to real estate for five main reasons. 1. Cash Flow – Given today’s record-low interest rates, opportunities exist for real estate investors to rent their properties for more than the monthly cost of ownership. 2. Leverage – Relatively large amounts of real estate can be purchased with a relatively low amount of cash. Most investment properties can be purchased with 25 percent down. The short-term goal is to use leverage to acquire a portfolio of real estate. The long-term goal is to pay the loans off and own properties free and clear. 3. Debt Reduction – Real estate is one of the few investments where someone else will make the payments. In essence the tenant makes the payments and reduces your debt each month. 4. Tax Savings – Real estate investors are allowed to depreciate the property and write off expenses in order to reduce taxes. Fallen foreclosure filings New residential developments Real estate by the numbers
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5. Appreciation – Over time the value of property has risen in the Northern Colorado market. Even though the values have increased, at The Group we believe appreciation is the ‘icing on the cake,’ not the cake. Real estate investment makes good financial sense even without appreciation. Helping our customers create financial freedom is one of our company’s goals. Attend our ‘Wake-Up Money’ seminar on Monday, September, 19, to learn how you can begin building wealth by investing in real estate. Call me to register or visit www.thegroupinc.com.
Cabela’s casting an eye on northern Front Range? Cabela’s, the legendary outdoors retailer that lures many Colorado residents to drive to Sidney, Nebraska, may be thinking about bringing the hunting and fishing haven a little closer to the mountains. Although you may not hear it from them. The hint about Cabela’s plans came from a Jefferson County Commissioner last month. Moments after Cabela’s decided not to build a new store in Wheat Ridge, Jefferson County Commissioner Faye Griffin told the Denver Post, “What we understand is that Cabela’s is planning on building two other Cabela’s, one maybe as far north as Fort Collins and one maybe in Colorado Springs.” An official comment from Cabela’s said, “We are not aware of plans to build a store in Northern Colorado at this time.” But then again, a savvy hunter isn’t likely to tip off their intentions. For the record, Cabela’s has one store in Colorado―in Grand Junction. It has built “destination” stores in Owattana, Minnesota, and in Kansas City, Kansas, both in excess of 150,000 square feet, which are considered tourist attractions in those communities.
Sales tax figures reflect a local retail revival You may have noticed Northern Colorado has been looking a little greener this summer. Based on recent sales tax collections in the region’s biggest towns, shoppers are spending more - which is providing more funds to local treasuries. Through June, sales tax collections were in positive territory to the tune of 3.9 percent in Fort Collins, 5.66 percent in Loveland and 8.8 percent in Greeley. Recently, Fort Collins also posted healthy July collections, which pushed the year-to-date growth figure up to 4.4 percent.
Pace of foreclosures in Northern Colorado improves significantly Consider it one more likely sign of a housing market that’s regained its footing. The number of foreclosure filings in the area have fallen sharply in recent months. Weld County, for instance, experienced a 32.8 percent decline in filings during the second quarter (April-June). At the same time, filings in Larimer County fell 17.6 percent. Total filings between the two counties dropped from 1,088 in the second quarter of 2010 to 792 this year. Statewide, the Colorado Division of Housing reported a 28.2 percent drop in filings from the first half of 2010 to the first half of 2011.
CSU, Fort Collins makes fast friends in Gig.U alliance Colorado State University and the city of Fort Collins are stepping onto the frontier of highspeed Internet. CSU is one of 29 universities and municipalities to join the Gig.U: The University Community Next Generation Innovation Project. Developed by the Aspen Institute, the Gig.U initiative is designed to speed the growth of highspeed Internet networks for its members. Universities gain from the access to expanded Internet connections that support research and distance learning, which communities benefit from economic development opportunities made possible by high-speed connections.
The Group and Everitt Companies partner on two new residential developments Bob Everitt came to Fort Collins and opened a small lumberyard in the 1950s, then expanded into the development business. He was instrumental in establishing the Fort Collins Country Club and made Fort Collins a shopping destination by co-developing the Foothills Fashion Mall, which opened in 1973. His first residential neighborhood, Indian Hills in central Fort Collins, was partially named in tribute to the people who once roamed the land.
College Ave
Shields Ave
Sixty years later Everitt Cos.—now a fourthgeneration family business—is embarking on Arrowhead, luxury residences with upscale interiors. Located in Fort Collins near the intersection of Shields Street and Drake Road, two timeless buildings offer five floor Prospect Rd plans, ranging from Centre Ave approximately 1,350 Rolland square feet to 3,800 Moore Park square feet. Worthington Cir Drake Rd Jamestown Builders, managed by grandson Aaron Everitt, presents Linden Gate Bungalows, also located in Fort Collins near the intersection of Lindenmeier Road (Lemay Avenue) and Country Club Road. Linden Gate features sweeping mountain vistas and lake views on 12 hard-to-find large lots (all with walkout basements), ranging in size from approximately 14,000 square feet to over 30,000 square feet! Call me to receive a brochure or learn more about either of these new properties.
REALTOR® makes the difference for FSBO founder The proof is in the purchase. The founder of a do-it-yourself real estate sales business, ForSaleByOwner.com, recently sold his luxury Manhattan condominium―with the help of a professional broker according to the Wall Street Journal. Unable to sell his carefully staged two-bedroom home after six months of practicing what he preached, Cory Sambrotto turned to a professional Realtor (who understood the nuances of the local market) and found a buyer. The apartment—which the Realtor determined had been priced too low and wasn’t drawing the right clientele—sold for $150,000 more than Sambrotto was asking! Some people believe that they will save money by selling their home themselves. “Mr. FSBO” may have assumed classified ads and the Internet would sufficiently promote his property; but by hiring a professional, he more than made up for what he paid in commission. Electronic promotion is just one piece of a comprehensive marketing plan The Group Realtors provide. Our educated and licensed partners’ services go well beyond marketing your home, and include items such as contract negotiation and preparation, transaction management from home inspection to lender and escrow services, just to mention a few.
If you know someone who would like to receive this newsletter, please call me. Horsetooth Office (970) 223-0700 375 E. Horsetooth Road, Fort Collins, CO 80525 Harmony Office (970) 229-0700 Mulberry Office (970) 221-0700
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Real estate by the numbers •
$12.1 million – Amount The Buttes apartments at 1391 N. Wilson St. in Loveland sold for this summer. The 111-unit property was purchased for $7.6 million in 2001, yielding a handsome return for investors.
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$330.8 million - Research funding for Colorado State University in Fiscal Year 2011, a 10 percent increase over 2010.
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4,100 - The number of people in Fort Collins and Loveland who hold “green” jobs - or 3 percent of all workers in the area - according to the Brookings Institution report “Sizing the Clean Economy: A National and Regional Green Jobs Assessment.”
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$2.5 million - Funding that two Colorado State University scientists received from the National Science Foundation and Abound Solar to study a means to reduce the cost of solar energy.
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18.6 million - Barrels of oil produced annually in the Greater Wattenberg Area field, which covers a large portion of Weld County.
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17 - Where Fort Collins ranked nationally among cities with the most businesspeople on Twitter, based on a survey by NetProspex.
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9.5 - The percentage increase in average home prices across the Western United States from June 2010 to June 2011, according to the National Association of REALTORS®. By comparison, average prices in the Midwest fell 5.3 percent in the same period.
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6,080 - The square footage of the new Palomino Mexican Restaurant at Crossroads Plaza in Loveland. The restaurant, which seats 250, is owned by Richard and Brenda Lucio.
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$882 - Average monthly rents for a two-bedroom apartment in Fort Collins-Loveland during the second quarter of 2011. Rents in the Greeley area averaged $649.
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32.8 - The percentage that foreclosure filings declined in Weld County from the second quarter of 2010 to the second quarter of 2011. Filings in Larimer County dropped 24.2 percent in that same time period.