Earlier this summer, RRC Associates held a Economic Summit in Steamboat Springs to review some data on tourism, travel, and how resort like Steamboat might be affected in the future. The news was pretty good. In the rougher economic times I would not have thought the data would have shown growth. But here are some of the highlights:

• Occupancy rates are increasing for resort hotels
• Job security higher for mountain travelers
• Steamboat Springs summer visitor have positive impressions
• Skier visits up 4.2% nationally from 2008/2009
• Rocky mountains make up 20.7% of ski vacation
• 2009/2010 ski season saw the 2nd best ever at 59.7 million in skier visits
• Rocky mountain saw an increase of 3.4% for skier visits last year from previous year
• In short, skiing is still a growing sport and people are still taking vacation in the mountains. And things are getting better

Click here to view the report.

The talking has started. It could be an epic year for snow in Steamboat Springs this year. La Nina could dump more powder snow this year than we’ve seen in years. I thought I’d post a little skiing of the last day of skiing – costume day.

Two months ago, when the April tax refund credit expired, we saw a lull in pending properties. That was a natural occurrence. Real estate sales are somewhat predictable and cyclical. More people want to buy in spring and summer and less people want to buy real estate during the winter holidays. Although Steamboat Springs real estate picks up during the winter – for obvious reason; we’re Ski Town USA after all. But predicting real estate sales in a stagnate real estate markets, in a slowly recovering national economy it just about impossible.

So the months of June and July (2010) were again a bit slow. Those 2 months saw a decrease in pending sales. In our MLS, there were about 60-70 pending properties during that time. Consumer confidence still is a leading motivator for buying real estate and consumer confidence remains low. That said, today we are looking at roughly 100 pending properties. Which is something we have not seen in a few months. There are many things that contributed this increase, but no one was the leading cause.
• Record low interest rates
• People wanting to buy before the school season
• Sellers not wanting to hold their property through the winter – lower prices = sale
• Some great bank owned properties at low prices = sales
Not enough change though to see a trend, but any sign of positive movement is good. I will continue to monitor the pending real estate numbers and update you soon.

Having kids in a small town is very special and living and owning real estate in “Ski Town USA” might just be the best thing in the world. One of our favorite things is celebrating Halloween – Steamboat Spring Style. In Steamboat, everyone young and old dresses up and walks down main street. It’s a wonderful, safe way to spend the holiday.

Steamboat Springs is one of the best areas in Colorado for fantastic fishing. Owning real estate in Steamboat and having some excellent fly fishing water just minutes from your door. We are spoiled here for sure. Here’s the Yampa river and the Elk River.

A year ago we were saying that interest rates were at an “all time low” – which they were. We also felt they would not go down much from there. Today we look back and shake our heads. Today’s rates:

30 year fixed = 4.125
30 Year Jumbo = 4.250
5/1 ARM = 2.99
5/1 Jumbo ARM = 3.99
USDA = 4.750

1. Price and location are the most important factors in selling a home. If the home is priced too high or in a location no one wants to live in, awesome photos make little difference. Price is a key issue in today’s sluggish market. Home sellers having a hard time wrapping their mind around how much their home has dropped in value the last couple of years. Getting home sellers to price their home at market value can be a big struggle.

2. Once a home is priced near market value and there are a bunch of other homes in the same price range and location, the importance of photography becomes appearent.

3. Now days, 90% or more of home buyers use the Internet to start their home search and they are faced with deciding which of all the hundreds of available homes they are going to go look at. Home searchers are faced with choosing which homes to physically go see and photographs play a major part. Anyone can appreciate this by simply going to any real estate website and pretend they are looking for a home. Today, there are 2,371 properties listed in our MLS. Click here to view this ever changing /REALTIME number.

4. As I browse through these properties, the initial selection must be by a handful of facts like year built, number of bedrooms and a small thumbnail photo of the front of the home. The importance of this thumbnail is unmistakable! A compelling thumbnail is like the bright flashy piece of metal on a fishing lure. It attracts home searchers attention to look at the listing details.

5. Once you click on the thumbnail to get more detail the importance of the photos increases. The text descriptions in listing details are legendary for their sparseness. One agent or home owner in a thousand will take the time to write good compelling marketing copy so photos pretty much take over the home searcher’s attention, even if the photos are awful. It is easy to see that good photos give the home seller a distinct advantage in the selection criteria. I believe 15 to 20 photos gives a listing a clear advantage over one with less.

6. Why are “good” photos more effective than “bad” ones? Because at this time in history even a 65 year old person has grown up with TV and magazine advertising that uses strong compelling images. Even though most people can’t tell you what makes a strong image, they know one when they see it. Strong images work at an intuitive, emotional level. You don’t need to understand how the image works to see and feel its strength. Strong compelling image can be created for exteriors and interiors of homes just like other subjects!

7. The end result of this online search process is getting on the home searcher’s short list of homes they want to see in person. A home will never sell if no one physically comes to see it and it’s easy to see from the steps above that photos play a key role in getting home searchers to come look at a home and thus selling it.

July 27, 2010 — Case-Shiller Home Price Indices are showing signs of improvements. This is the Standard & Poor’s leading measure of home prices for U.S. real estate. This is great news.

Click here to view report

Many people are told that appraisers cannot use distressed sales as a comparable – thus these sales will not impact prices. This is incorrect.

It’s common to hear real estate agents say “appraisers cannot use distressed sales to value a property”. This used to be somewhat true but the rules have changed. And here are several examples of how and why distressed properties do have negative impact of properties.

• Buyers Perception. If a buyer has a choice of many similar homes, and one is a distressed property offered at a 20% discount, they are likely to buy the discounted property. And as long as the inventory of these discounted properties remain available, they will likely sell before the non-discounted properties. This is a common value based purchase.
• Valuation for Loan / Lender. If one is obtaining a loan for a purchase, the bank will require an appraisal. Appraisers are allowed to use distressed sales as comparable with clarification. And because we have so few transactions here at this time, finding enough sales are difficult. Here are several examples:
o If there are not “fair market” comparables available. Then distressed sales are used but the appraiser must adjust for the situation. In other words they can explain the situation and make adjustment for the loan. But banks do not like large adjustments. Typically 10% is ok. But if there’s a sale at $300,000 and the loan is for $400,000, then that is a problem.
o If there are some “fair market” and some “distressed” sales, then again, adjustment can be made. But appraisers are only allowed to adjust so much.
o Bank will always ask the appraiser the amount of distressed properties / sales in the area. If there are more foreclosure in a particular area, then bank will tend to be more strict regarding values.
• Valuation for Quick Sale. If a seller orders an appraisal because they needs to sell it fast, then the appraiser will take all comparables into account and value it near the distressed prices.

As much as we’d like to think the distressed properties do not have an impact on our homes value, it’s inevitable that they will given our situation. And the situation is this: we live in a small community. There are very few comparables; even in good times there are not a lot of sales. And with so few sales, we tend to be affected by the swings of the market more than larger cities.