Finding Success in the Current Real Estate Market

Mortgage and Lending with Cherry Creek Mortgage

I live in Castle Rock, Colorado, on the south side of the Denver Metro Area.  This article will cover both local and national (general) trends.  Let me start nationally.

Over the past five or so years, most of the nation has seen rapid increases in real estate values.  I won't go into the "why" of all that, it just is a fact... for most places.  However, recently, just about anyone who's watched the News, been on the Internet, or read a Newspaper, knows that the party is over.  

The most recent Case-Shiller S&P Housing Index Survey (from August) indicated that housing values are down nationally by, (I'm going from memory here,) 3.2%.  So, this is bad, right?  Well, I guess it depends on how you look at it and how you react. 

I was talking recently with a professional acquaintance who told me someone on her team had recently lost a relocation client because housing values had started to decline in the market where his current home is located.  This is kind of like someone saying, "I'm on the Titanic, we just hit an iceberg, the ship is starting to go down, so I think I'll stay on board."  Professionals in our industry MUST react calmly to such situations and be able to explain the reality of the situation to the client. 

I personally think now is a great time for the relocation market in most pockets in the country.  If housing prices are starting to decline, the play-book should read something like, "OK, you have an opportunity to get out of here.  You've made twenty percent over the past five years; the market is now down 5%.  Sell now before it gets worse, make 10-15% and move to a market that did not ride the wave where prices, comparatively, are more reasonable, appreciation is more likely to occur, and where jobs are good." 

Conversely, in markets that did miss the boom, like my own in the Denver Area, the inbound script is more like, "We did not participate in the nationwide frenzy; housing prices in our area are now in line with, and even a bit below the current national average; our jobs market is growing; housing inventories are declining (indicating a future appreciating market); and we are actually now three months into a housing appreciation cycle."

What I'm driving at, for industry professionals, is to see the opportunities and don't fall into the current media-hype that is inappropriately scaring the wax out of consumers.  Fear breeds inaction.  Confidence, which you can instill, will enhance your professional standing and, more important, create value to your clients.

Now... a word for home-owners:  Because interest rates have dropped, there is a segment of the population where the current housing situation creates great opportunities.  They're everywhere!  In down markets, there are a higher number of foreclosures.  In markets that did not participate in the rapid appreciation of the past five years, there is a higher chance of housing appreciation over the next five to seven years.  Now is a time to leverage equity from a current home, liquidate the home, and buy up in a market that is currently favorable.

I love the position of the Denver Area market especially.  In my opinion, because of a wide variety of economic fundamentals, the Denver Area will be a great place to buy real estate for the next six to twelve months because we are on the very front-end of what I foresee as a five to seven year appreciation cycle.  I will go so far as to say that housing in my area should appreciate by 20-25% over the next five to seven years.  When you combine that type of increase with a 10% down-payment, the return on investment would be somewhere around 100-150%.  In other words, an investment of $50K would be worth $100-150K. 

The current market is not only creating opportunities for housing sales and purchases, it is also creating opportunities because of favorable interest rates.  See the "glass half full" side of the equation and you will be able to capitalize on real opportunities that the "panic-driven" will miss.

Greg Polashock is a Real Estate Home Mortgage Loan Consultant and Certified Mortgage Planning Specialist with Cherry Creek Mortgage and resides in Castle Rock, in Douglas County Colorado.  He can be reached via email at, by phone at 303-887-0672 or on the web at

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