Horse Property Market Value

Colorado market value

Colorado market value is the price of real estate in the state without any outside forces working against it.

If you are selling or buying a horse property in Colorado, then you should be aware of how market value works. This explanation of the Colorado market value is simple enough, but there are certain nuisances that make it more complicated. For example, homeowners could order an appraisal before they put their home on the market. However, they would incur the expense of it themselves. Also, it can’t be used by the buyer or their lender in the home buying process.

Licensed appraisers look at Colorado market value in three ways—The market data, the replacement cost and by income. A part of being an appraiser is determining which of these three ways they will use. The replacement cost looks at what it would cost to rebuild the property. The income way uses a capitalization rate based on the net operating income of a property to determine value. The market data way relies on recent sales of similar properties nearby.

Real estate agents have been known to use a similar approach to determine fair market value. They perform a Competitive Market Analysis, or CMA. This analysis it looks at recent sales of similar properties, considering properties currently for sale and what homes actually sold. Both appraisals and Competitive Market Analysis reports have a distinct advantage. One is based on the personal opinion of a professional and the other is based on online website estimates using raw data and mathematical formulas.

Though this information is important when selling a home, it is not the “end all, be all” so to speak. Regardless of which method is used, it is just an estimate. Obviously, some estimates are more accurate based on the experience of the person making the estimate. If you need help finding an experienced appraiser that can give you accurate Colorado market value estimates, contact your friends at Colorado Horse Property today.

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Colorado Horse Property Inventory

Colorado Home Inventory

Colorado Home Inventory, like many things in our lives, is in a housing market that fluctuates.

This fluctuation in the Colorado home inventory goes up and down depending on supply and demand. The fluctuation is done with considerations to the area of market and the price range. The NAR, National Association of Realtors, defines a market as balanced when it has a six month supply of homes for sale. The National Association of Realtors is America’s largest trade association. The NAR represents 1.2 million members. These members include NAR’s institutes, societies, and councils. Members are involved in all aspects of the residential and commercial real estate industries. Likewise, if it takes longer than six months to sell, it is thought to be a buyer’s market and less than six months, a seller’s market.

When it comes to looking at the market, the inventory of existing homes has been reducing. This reduction is by approximately 1.5 million houses. This accounts for 10.3% lower than a year ago. According to the Federal Reserve Bank of St. Louis there are 5.7 months’ supply of new homes currently on the market in the United States. Therefore, on average the country is balanced. Inventory has a direct impact on price.

When demand is constant, but inventory is reduced, price tends to increase. This is because the same number of people are trying to buy a smaller than normal number of homes. It is definitely a good think to be able to spot the direction prices will be moving, whether you are buying or selling a home. When prices and mortgage rates rise, buyers might not be able to afford the same price or size of homes. Colorado is a great state to live and raise horses. For more information on how to get a horse property, contact the professionals at Colorado Horse Property.
 

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Lender and Borrower Relationship

Lenders and Borrowers

Lenders and borrowers have a unique relationship when it comes to the home buying process.

For most transactions lenders and borrowers have a formal relationship. However, when the lender and borrower know each other, whether they are family or friends, is an entirely different story. The Internal Revenue Service has specific rules that govern the transaction especially when the parties know each other.

For starters, the loan must be done in a business-like manner. Even though you know one another doesn’t mean that you don’t have to do everything that you would normally do. You are going to want to have a written note specifying the loan amount, interest rate, term and collateral. The Internal Revenue Service requires that the mortgage be a recorded lien to allow the interest deduction.

You may be in a situation in which you have a less than normal interest rate on your mortgage. Though this is a great thing, remember that there are restrictions on this as well. The rate charged in the note is regulated by the minimum applicable federal rate which is published monthly by IRS based on current Treasury securities. You don’t want to make any of these agencies mad, so make sure you follow the guide lines they specific as closely as you possibly can.

The seller must report the interest paid to them along with the name, address and Social Security number on schedule B when the buyer uses the property as their principal residence. If you play your cards right, you may allow the borrower a slightly lower rate without the expenses of a traditional lender while giving the note holder a higher rate than they can earn in available investments.

Your tax professional can guide the transaction whether you’re a buyer or a seller and your real estate professional can help arrange to have the documents drawn and filed. If you are looking for a lender, contact Colorado Horse Property for assistance.
 

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Renting for Horse Owners

Renting for Horse Owners

Renting as a horse owner is probably not a good idea.

Do you own your own horse in Colorado but don’t own your home? Do you rent an apartment and keep you beloved, equine family members boarded at a stables twenty miles from your home? There are many reasons why a horse owner should own their own home. Colorado Horse Property has over 3,500 horse property listing and are committed to getting you into the horse property you and your horses deserve. Here are a few problems with renting in general.

It is a sad reality when we are unable to buy our own home, and instead are buying the home of our landlord. Of course I’m talking about renting. Amortized mortgages that a landlord pays sees a reduced principal amount on the loan and it is usually repaid quickly. unbeknownst to the renter, they are retiring their landlord’s mortgage with the rent that they pay to them. It is crazy to think about, but this renter/owner relationship is very real in today’s economic climate.

The problem with renting is that you payment is higher that what home owners are paying for their mortgage payment including taxes and insurance. The experts in the field are saying that we may never again experience the incredibly low mortgage interest rates currently available. When you rent, you do not have the same advantage that homeowners have by using their home as a leveraged investment.

If you are renting, consider looking for loans that could help you buy your own home. Talk to a loan professional to find out exactly what types of loans are available and the specific down payment required. Remember, down payments can be a whole lot less than twenty percent, and therefore very affordable. Contact Colorado Horse Property for a referral to a loan professional near you.

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It Costs to Wait on Your Horse Property

It Costs to Wait

It costs to wait when it comes to purchasing your horse property.

It costs to wait in respect to buying property. The last thing you want to do is pay more later for a property that you are looking at now. There are many things that can affect the price of a home just as there are many reasons to wait and not wait on buying. Here are a few things that you need to know.

Colorado Horse Property knows that buying a home is one of the biggest decisions you’ll make this year, but did you know that waiting could be costing you more money? Financial experts have been expecting interest rates to increase along with home prices. While homes have definitely increased over the past five years, the mortgage rates today are actually lower than they were a year ago.

Consider the following scenario. Interest rates have increase by 1% over the next year while homes appreciated at 5.5%. That means that a $260,000 home would go up by $16,000 and the payment would be well over two hundred dollars more. The increased payments alone would amount to $17,800 for the next seven years. When facing a decision to postpone a home purchase, you should ask yourself: “how will it feel to have to pay more to live in basically the same home?”

Use the Cost of Waiting to Buy calculator to estimate what it might cost to wait to purchase you horse property based on your own estimates of what interest rates and prices will do in the next year. This cost of waiting calculator is a great tool that you can use to get yourself prepared. Finding out how much it costs to wait on buying a home should be your first step in the home buying process.

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Mortgage Interest Points

Mortgage Interest PointsDid you know that when loans are quoted by lenders, there is little to no notice of the points that may be charged along with the rate?

You may not even realize that these points exist if you are not familiar with the home buying process.

These points correspond to one percent per point of the mortgage amount, the previously paid interest that affects the loan’s return. Buyers and sellers can elect to pay these points to reduce rates but you should be aware that there can be limits on paying for points based on underwriting guidelines which differ from types of loans.

Lower note-rates would obviously make the payments less, but with a little analysis you can discover some helpful information. Knowing how much points paid up-front can save a borrower and  whether they can get back additional costs is very useful.

If a buyer stays in a home for ten years, they can save two thousand dollars over the cost of the point. A less obvious advantage will be realized because the unpaid balance on the lower interest rate loan will result in an additional savings.
 

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Tax Refunds and Home Buying

tax refundTax season can be very stressful, but for a lot taxpayers the reward is receiving a refund. Though refunds differ from state to state and person to person, the average tax refund is around three thousand dollars for most Americans. Colorado Horse Property would advise you not to use your tax refund on just anything, especially if you are thinking about buying a home.

While the average tax refund might not cover the down payment on a median priced home in Colorado, it definitely helps out. Ranging from two to three percent of the the purchase price, closing costs for originating new mortgages can be expensive; that’s where your tax refund can come in handy. Most lenders will let you pay part or even all of the closing costs on your new home based on what is agreed upon and outlined in the sales contract.

Just have it written in the agreement that you will pay for your closing costs with your refund. If you are able to get a low down payment, then your refund can certainly go towards that cost as well. Many buyers think it takes 10% or more down payment to purchase a home, and though that could be the case it is oftentimes lower than you might thing. There are VA and USDA mortgages that have no down payment for qualified buyers. FHA has a 3.5% down payment program and FNMA has 3% down payment mortgages for qualified creditors.
 

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News For Home Buyers

Things Are Looking UpBuying a home is a big decision, and the tax laws in the past can weigh hard on that decision. In today’s economic climate buyers who worry about what might happen to the tax laws affecting home ownership should feel more confident about moving forward with their decision to buy—here’s why.

The good news: The Tax Cut and Jobs Act continues to treat real estate as a favored investment. Whether it is for your home or a rental property, the tax laws are in place. The only thing that might still be concerning are mortgage rates which are expected to rise as well as prices. But don’t give up just yet. Your dream home can still be yours and sooner than you think.

Not only is the mortgage interest deduction intact for most taxpayers, the capital gain exclusion for principal residences up to $500,000 is also still in place. Taxpayers can annually elect to take a newly increased standard deduction or itemize deductions; the taxpayer will pick whichever will benefit them the most.

A house payment under the new laws, along with taxes and insurance, is most likely cheaper than to rent because rents will continue to rise in the future. Rental properties are still great investments because Section 1031 exchanges, capital gains and depreciation remain the same for rental properties.
 

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Time Management

Time ManagementIf you have a family or an active lifestyle, then you know how precious time can be. Your schedule fills up quick with more things to do than there are hours in the day. You have an appointment in the morning, your kids have lessons to get to, and you still need to go shopping to fill the empty pantry.

Time is valuable and no one wants to it, most of all real estate agents. Agents know that you can’t put your life on-hold while you’re trying to buy or sell a home. Whether you have a family, a couple, or you are single, life continues and the time constraints of moving can become burdensome. Agents at Colorado Horse Property are committed to helping you save time while making the experience of buying or selling a home memorable. We know the process and the potential problem areas and can help you move through them. So to preserve your precious time, and your agents time and energy, here are a few things you can do.

First and foremost, if for what ever reason you are no longer able to buy or sell depending on what you are trying to accomplish, always let your agent know as soon as possible. There’s nothing worse than an agent spending hours trying to find the perfect home for you and then find out later that you changed your mind the day before. Secondly, if you agent is on time for appointments than you should be.

Cancelling appointments with agents should be done with as much notice as you can possibly give. One of the biggest set backs in the buying process is not having all of your required documentation. So work with your loan professional by providing all requested documentation when it is needed. If you gather all the required documents on the same day for an appointment and store them in the same place, you can reduce the chance of forgetting anything.
 

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Rates Through The Ages

Rates and Prices Through The AgesRates Through The Ages From 1968 to 1980

In 1968, the mortgage rates were 8.5% but they went down to 7% the following year. Homeowners could buy a home that was 15% to 20% larger home with the same mortgage if they could find someone to assume the payments. Federal Housing Administration and Veteran Affairs mortgages were very popular in certain price ranges and they allowed buyers to assume the mortgage regardless of the credit. Therefore, if you could get someone to take over your payments, you were free to qualify for another mortgage.

Rates From 1981 to 1999
In 1981, mortgage rates reached a whopping 18.63%. A quarter of a million dollars of mortgage had a monthly principal and interest payment of nearly four thousand dollars. As crazy as that rate sounds, people were still buying homes; they were good investments. Four years later, the rates were going down but they were still over 12%.

The monthly payment from our previous example would now be twenty-five hundred. Home owners happy to be paying only two thirds what they had to pay a few years earlier and that was a good thing. Fast forward to late 1991 when the rates went below 9%—that same payment was down to two thousand dollars a month.

Rates in the 21st Century
Rates during this time were 8.15% and that made the payment of a quarter of a million dollars of mortgage less than two thousand dollars a month. Rates were even lower in 2008 at 6.04%. By 2009, mortgage rates had fallen below 5%. The lowest mortgage rate was 3.31% on November 2012 with a payment one thousand dollars via our previous example.

As you can see, rates fluctuate and most of the experts are expecting rates to be above 5% by the end of this year. Rates have been historically low for a long period but will probably continue to go up. Based on history, even 8% would be an excellent rate for home owners. Until it reaches that point again, everything lower is a bargain.
 

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