Neil Kearney has once again been recognized as one of the top real estate professionals in the Denver Metro Area. The “Five Star Professional” award in the real estate category is awarded each year based upon independent research and interviews with actual clients from the past year.
The Five Star Professional research team applies a vigorous research and evaluation process to identify service professionals who provide quality services to their clients. Professionals do not pay a fee to be considered or placed on the final list of Five Star award winners. Along with outstanding survey results the real estate agents who are considered must obtain a high standard of production.
This year the criteria was tightened, and under 750 real estate agents in the Denver Metro Market were recognized as a Five Star Professionals. There are currently over 20,000 licensed real estate agents in the Denver area. Neil feels honored to be once again be designated award winner. This is one of the most credible awards a real estate agent can receive because it is based upon direct feedback from recent clients. Only the highest scoring agents are selected.
Here is a description of the research methodology that is used. Five Star Professional follows standard survey practices used by other professional research organizations. The research also includes a regulatory review to provide necessary checks and balances. Five Star Professional conducts research to help consumers with the important decision of selecting a service professional. The Five Star award is presented to wealth managers, real estate agents, mortgage professionals, home/auto insurance professionals and dentists in more than 45 markets in the U.S. and Canada.The Five Star Professional research team applies a vigorous research and evaluation process to identify service professionals who provide quality services to their clients. Professionals do not pay a fee to be considered or placed on the final list of Five Star award winners.
In each market, award winners are listed at no cost in a special advertising section within the city/regional magazine and on fivestarprofessional.com.
Five Star Professional follows standard survey practices used by other professional research organizations. The research also includes a regulatory review to provide necessary checks and balances.
Five Star Professional:
- Conducts comprehensive research
- Recognizes service professionals
- Partners with leading city/regional magazines
- Helps award winners gain the recognition they deserve
This past May, Zillow, the online real estate search company was sued by a Chicago based home building company who claimed that Zillow’s online Automated Value Model (AVM) is deceiving home buyers with prices below the true value of properties leading to frustrated sellers. Furthermore the suit claims that Zillow’s “Zestimates” are in violation of the legal description of an appraisal, which under Illinois law must be administered by a licensed appraiser. Zillow defends themselves by stating that their Zestimates claim only to be approximations not true appraisals; to which the suit responds stating that whether or not they are technically appraisals homeowners are viewing them as such leading to confusion and irritation. It will be interesting to see over the coming months how this lawsuit plays out. It’s clear that Zillow’s Zestimate and other AVM’s which are becoming common across the internet are being used by consumers to determine the approximate value of their home. But in my experience, many times this approximation isn’t close to the true market value.
So just how accurate are Zestimates. In a Nationwide study conducted by Zillow it was found that their Zestimates fall within 5% of the sales price of homes 53.9% of the time, within 10% of the sales price 75.6% of the time and finally within 20% of the sales price 89.7% of the time. Back in 2007 when Zillow was just getting its footing I conducted my own research local to Boulder on the subject and found that on a whole Zillow’s algorithm was 99% accurate. However, when I took a closer look I found that there was an 18.4% standard deviation. Additionally, the outliers were up to 50% off. Although Zestimates generally do a good job when looking over a large pool of properties, their approximation for any specific property within that pool can many times be significantly off of the true value.
To read my 2007 article click here.
With home values rising as fast as they are in Boulder and with Automated Value Models such as “Zestimates” readily available, inexpensive and simple to use, it’s easy to understand why so many consumers gravitate towards them. It’s important to remember though that the very nature of AVM’s being automated hinder their ability to provide an accurate evaluation of properties all of the time. AVM’s fail to take into account many critical and influential aspects of a property that can greatly affect the value such as the current condition, recent upgrades (or the lack thereof), actual square footage, views and other details. After understanding these substantial flaws it becomes clear why AVM’s, including Zestimates often over or undervalue homes leading to users feeling mislead.
AVM’s have their place as a non-binding general view of the market when you are not considering a transaction. It’s fun to look. However, when you are considering a real estate transaction you need to bring in an experienced professional to give you a more accurate comparative market evaluation. Experienced Reatlor’s like myself can give you the broad information and experience necessary to make decisions around. If you are considering a move I would be happy to come by and give you an individual market analysis.
To read more about the case go to: http://www.marketwatch.com/story/do-zillow-zestimates-mislead-home-buyers-illinois-lawsuit-claims-yes-2017-05-22
One of the most satisfying parts of my career is that I get to work with the nicest people in the world! I get to interact with them consistently over an exciting and emotionally charged and sometimes intense period in their lives. Selling or buying a home means change, sometimes it’s great (yay! new job, new baby…) and sometimes it’s not a change you look forward to (divorce, change in finances…). But through it all I love to bring my best to every situation and provide exactly what my clients need at the time. Sometimes it is a calm voice of reason through the inspection process. Sometimes it’s a cheerleader when your fifth offer just got accepted. Sometimes I’m the one who has to take some bad news and chart a new path to your goal. Sometimes I’m just there for you providing the expertise you need. Sometimes I’m the one who gives you the nudge that points you in the direction that turns out to be the “best” move for you. Regardless of the situation I’m happy to be of service – it’s what has kept me happily going for 25 years now.
So when a client takes the time to write a testimonial for me it’s a much appreciated cherry on top. Here are a few recent testimonials that my clients have posted on my behalf. Aw shucks, you guys are the best!
“We could not have a better agent than Neil Kearney. He was very patient, answering all our questions and addressing all our concerns. He provided all the support we needed, as we are living out of the state by the time we decided to put the house in the market. Something very important: The communication was always very good. We strongly recommend Neil to prospective buyers and sellers. The best!”
“Neil was great to work with! He has a comprehensive knowledge of the market, and was committed to our home search with patience and enthusiasm during a difficult buying process. I highly recommend Neil!”
“Neil did a great job helping us find and purchase our new home. He was always quick to respond, and not only guided us through the process but made it really easy. Thanks Neil!”
“If you’re looking for someone who knows the Boulder market inside and out, Neil is the realtor you want. Honest, reliable, Neil was always available to answer questions or arrange a last minute showings. We can’t recommend him enough.”
“Neil is a fantastic realtor. I have used his family business for several real estate transactions over the years and have always been impressed with his professionalism, competence, and diligence. He was always available to answer questions and he explained the nuances of selling property in today’s market extremely patiently! I recommend him to anyone looking to buy or sell. Thanks Neil!”
To see more testimonials go to this page and this site.
Do you know what PITI is? If you have a loan on your home you probably know that these are the four elements of a mortgage payment. P stands for principal; the first I stands for Interest; T stands for taxes and I stands for insurance. Together they make up the amount you pay for your home on a monthly basis. If your PITI payment is comfortable for you, you will have extra funds available to pay for all of your living expenses, be able to save some money on a monthly basis and have some left over for some fun. But many times as we consider how much of a house we can afford we key in on the price of a home and the interest rate (these go into determining the ‘P” and first ‘I’) without much considering the ‘T’ and the ‘I’.
Before I get started talking about property taxes I want to make it clear that this is not a comprehensive article on taxation. There are many elements that go into the discussion of total taxation that include income tax, various sales taxes, car registration fees, use fees, transfer taxes, etc., this article just focuses on one element and is therefore not a comprehensive picture. It doesn’t fairly compare apples to apples across states. However, I think it’s an interesting and relevant topic because it comes up often in my discussions when I am showing property.
Corelogic recently did a study ranking the median property tax rate across the country. The highest property tax percentage is in Illinois where taxes are 2.67% of the assessed valuation and lowest in Hawaii where the property tax burden is just .31%. Colorado is ranked 5th from the bottom with .66%, meaning that we have the 5th lowest property tax burden in the United States. Despite the arguments* that there are too many elements not included in this study I think in general it’s true that the cost of ownership in places like Illinois, New York, New Jersey are much higher than they are in Colorado. In Colorado the “T” portion of our payments is much lower than other states and therefore, all things being equal, we can afford more expensive homes with the same payment.
Local Property Tax Comparison
Now let’s get more granular. Within my market area buyers need to look closely at property tax rates within the different localities. Here is a quick comparison of homes currently on the market. I have tried to choose homes that are similar in price and similar in assessed value.
- Boulder – 4616 Talbot Dr. | List Price $574,000 | Assessed Value $423,900 | 2015 Taxes $2,766 | Tax/Assessed .648%
- Louisville – 453 Centennial | List Price $599,900 | Assessed Value $450,200 | 2015 Taxes $2,988 | Tax/Assessed .664%
- Lafayette – 369 Caribou Pass | List price $580,000 | Assessed Value $464,300 | 2015 Taxes $3,180 | Tax/Assessed .685%
- Longmont – 5712 Clover Basin | List Price $575,000 | Assessed Value $409,700 | 2015 Taxes $2,971 | Tax/Assessed .725%
- Superior – 3103 Castle Peak | List Price $599,900 | Assessed Value $464,100 | 2015 Taxes $3,881 | Tax/Assessed .836%
- Erie – 1276 Greening | List Price $560,000 | Assessed Value $399,950 | 2015 Taxes $3,483 | Tax/Assessed .871%
- Broomfield – 4630 Nelson | List Price $569,000 | Assessed Value $466,710 | 2015 Taxes $4,490 | Tax/Assessed .962%
The order listed is ranks the local communities for property tax burden as a percentage of the assessed value of the property. Boulder has the lowest tax rates and Superior, Erie and Broomfield have the highest. If a buyer were to be comparing homes in Boulder and Broomfield, the taxes make a difference. The differential in the monthly payment is around $100 per month, definitely worth looking at.
*Some of the arguments that invalidate this report are: a) Different states base taxes on different amounts. Assessed value vs. actual value. b) Some states give a homestead exemption. c) Some states assessed value doesn’t change until a sale and then it goes to the purchase price. d) The report doesn’t take into account special assessments or the prevalence thereof within states.
Boulder Neighborhood Guide
I realized a few years ago that people coming from out of town were having a hard time characterizing the different neighborhoods within Boulder. In response I created the Boulder Neighborhood Guide. In this report I have split Boulder into eleven different areas and present the lifestyle highlights, schools, shopping districts, local recreation and real estate statistics for each area. If you’re interested in learning more about the different neighborhoods within the City of Boulder this is your guide.
Click this link to view and download the report. Boulder Neighborhood Guide 2016
It is recognized that Boulder is a great place to live but the neighborhoods in Boulder are a bit hard to peg. Boulder was developed over time in a piece-meal fashion. The result is that many of the neighborhoods are only a few hundred homes in size. It is common to have two adjacent neighborhoods developed at different times and with completely different price ranges. While this report is not comprehensive, it will give the reader valuable information from which to start understanding the real estate market in Boulder. I will highlight the major neighborhoods in each area.
Here are some highlights from within this years report.
Last year homes in Boulder County appreciated roughly 13.52%. But the appreciation varied between areas and price ranges. Within Boulder neighborhoods as I have split them in the report gains in median prices ranged between 6.6% to 35% depending upon the area. Here is the list of neighborhoods sorted by median price appreciation last year:
- Wonderland Lake / Dakota Ridge = 35%
- North Boulder East = 28%
- North East Neighborhoods = 28%
- Whittier = 24%
- Chautauqua / University Hill = 16%
- Gunbarrel = 13%
- Retail / Industrial Core = 12%
- South Boulder / Table Mesa = 11%
- East Boulder = 7%
- Newlands – 6.7%
- Mapleton Hill = 6.6%
A Few Notes: Wonderland Hill / Dakota Ridge is in the far NW portion of town and this is where there are the newest houses coming online. It is also west of Broadway which always means premium prices. Newlands and Mapleton Hill have some of the highest priced real estate in Boulder. The luxury market did not increase in price as much as other, lower priced markets so those areas saw the smallest average appreciation.
Click this link to view and download the report. Boulder Neighborhood Guide 2016
Hold on and get up to speed!
Hold on and get up to speed! Homebuyer’s in Boulder County are getting a crash course in rejection. The local real estate market is still running on all cylinders and seems to have a full tank of gas. In April and May there were 789 real estate transactions that closed in Boulder County. 270 closed at less than full price, 98 closed at full price and a staggering 421 closed above full price! Two-thirds of the sales in our market during the past two months closed for full price or more. The average transaction closed for 1.2% above list price. I haven’t seen anything like it during the past twenty-five years.
Looking more closely at the homes that sold above full price is an interesting analysis. One that could come in handy if you find yourself in a situation where you are competing with multiple offers. The big question is how high do I need to offer? Of course every situation is different but here is the recent data.
Sales in Boulder County closing in April and May of 2015 that sold for above asking price:
Price Range – $0 – $250k Number of sales = 93 average premium paid = 5.5%
Price Range – $250K – $500k Number of sales = 212 average premium paid = 4.5%
Price Range – $500k – $750k Number of sales = 74 average premium paid = 5.1%
Price Range – $750k – $1 Mil. Number of sales = 23 average premium paid = 4.9%
Price Range – > $1 Mil. Number of sales = 19 average premium paid = 5.0%
Overall if a buyer paid above asking price (presumably a majority of these were in a multiple offer situation) the average they paid was 4.9% above the list.
Here are some other statistics from the data set that could be very helpful.
City of Boulder
- 353 total sales
- The average sale closed for 1.4% above full price
- 157 properties sold for a price exceeding full price.
- The average premium paid in Boulder for those houses that sold above list was 5.9%.
- The lower end of the market is stronger than the upper end.
- The average home in Boulder that sold at $500,000 or below sold for 3.2% above list price. The average premium paid for those that closed above asking was 6.4%.
- The average home in Boulder that sold above $500,000 sold for .2% above list price. The average premium paid for those that closed above asking was 5.5%. There was much more negotiation below asking price in this price range on those that didn’t sell for full price or a premium.
- Just 43 sales over the past two months. Average sales price was .6% above list price.
- 18 properties sold above asking price. The average premium paid was 4.4%.
- 76 sales over the past two months. Average sales price was 2.2% above list price.
- 45 properties sold for above asking price. The average premium paid was 5.1%
- 292 sales over the past two months. Average sales price was 1.5% above list price.
- 150 properties sold for above asking price. The average premium paid was 4.3%.
- 42 sales over the past two months. Average sales price was 1.1% above list price.
- 21 properties sold for above asking price. The average premium paid was 3.8%.
- 28 sales over the past two months. Average sales price was 1.2% above list price.
- 16 properties sold for above asking price. The average premium paid was 3.5%.
- Other areas including Nederland,Niwot, Lyons
- 56 sales over the past two months. Average sales price was 2.9% below list price.
- 12 properties sold for above asking price. The average premium paid was 2.3%.
Here are my takeaways from this information.
Over half of the homes that sell are selling for above list price. If you find yourself interested in a house that has multiple offers the average amount that you should expect to pay is around 5%. The median is actually around 4%. So if you had bid 4% over on a home that had multiple bids you would have been successful half of the time over the past two months. Over the past 10 years the average negotiation on all sales has been 2.8% below list price. This is the first time I can remember that the average sale has gone above list price.