Pulling cash out of an investment property instead of selling is a great way to access a lump sum of cash without being taxed on it. The average home owner in America has $200,000 in equity in their home and can easily pull out $100k and often get a lower rate in the process.
Taking mortgage forbearance during the pandemic did not affect your credit score at all. Taking it in 2008 trashed your credit, people just did it to avoid foreclosure. Even if 25% of people that are in forbearance now list there home this year it would only have a mild effect on inventory levels.
I’m no CPA but I have read IRS pub 523 and cringe when I see folks going to great lengths to wait two years to sell due to a job related move. Many people can claim an exclusion large enough to completely avoid capital gains even when selling well before the two year mark. Any CPAs want to call me out please do :)
Mortgage interest rates will cool the market but their effect can be counter acted by the supply and demand issues we’re currently experiencing. In 2018 rates went to 4.9% which is almost 2% higher than they are right now but the NoCo market continued to climb and posted at 7% gain for that year.
So often we get hung up on past sales when we are pricing property and of course that is an important thing to consider. But when buyers are shopping for property they are aren’t paying attention to past sales. The only thing on their mind is this, “What is available to buy right now?” Before we decide on a final list price for our listings we pretend to be the buyer for that type of home and we go tour other similar properties and see how they compare to ours. And it’s important to physically look at these homes instead of just flipping through pics because that’s what your buyers will be doing. This strategy often provides excellent insights into what the market is doing right now. Not what it was doing 6 months or a year ago. And in this low inventory market after going through this exercise we often find ourselves saying “wow there is nothing like this property available right now.”
Be aware that a portion of highway 287 will be re-routed started in 2023 due to the construction of Glade Reservoir. If you are looking for acreage in North Fort Collins it’s important to understand the new location of the highway and how it might affect your property.
Be aware and spread the word that Zillow is buying up homes in Fort Collins as fast as they can. They have more than enough buying power to manipulate our market and make already unaffordable housing even more expensive for Fort Collins residents.
Young people and low down payment buyers can be successful in this market. It takes time, planning and often off-market property location but it can be done! 😀 Do you guys know what the minimum down payment is for a home
Talking to neighbors and tenants is the most under rated due diligence item of all time. We’ve learned about everything from undisclosed flooding to gang activity but the most common complaint we hear is about their burning hatred for a dysfunctional HOA. 😝 This is especially true of condo and townhome associations. One time I was walking through a condo parking lot with my buyers after a showing and asked a neighbor how she liked the complex and if she felt the HOA was well managed. She paused for a second and said, “You all should probably come in for coffee.” 😳
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