This, my friends, is an upside down house in Austria. I don’t want to talk to you about this house – although you should check out the article, it’s pretty cool. What I want to tell you is a story about my friends Sue and Derek (*not their real names), and what happened not too long ago when their house in the Metro Denver area was upside down.
Sue and Derek live on the South end of Metro Denver, like many of my friends and clients do, and a little over a year ago they found themselves in a pickle. Money was tight, bills were mounting and their mortgage felt like a burden they weren’t sure they could afford. They considered selling their home, but much to their dismay, they owed about what the home was worth at the time, and after the costs of selling the home they would have to bring money to the closing table. This couple had no equity in their home, and they were concerned they might lose the home to foreclosure if they weren’t able to successfully enter into a loan modification with the bank.
This, friends, is what it means to be upside down in one’s home. This is a mild case – in some markets that have fallen on tough times, homeowners have found themselves much further underwater than Sue and Derek with a home worth much less than they paid for it. This is not a good situation to be in, particularly if your income changes or you want or need to sell your home.
The reason I’m telling you about Sue and Derek’s situation is to shed some light on what is happening in the Denver Real Estate market. For some, the economic downturn does not feel far enough away in the rear view mirror to truly move forward with confidence. Changes to your job, your spouse’s job, the value of your property, etc. might have been too challenging for you to be able to move past emotionally despite the upswing in the economy, and I don’t blame you for wanting to be cautious after whatever damage the economy might have done to your wallet, retirement fund or home value. I get it.
Sue and Derek were ultimately able to achieve a reasonable loan modification plan that saved them a few hundred dollars a month and let them keep their home. Even better, they recently sold the home with a net profit to them (tax free, by the way – consult your accountant about how that works) of $50,000. After all fees, commissions and buyer concessions were covered, these folks walked away with $50k in their pockets and an opportunity to start fresh in a home that is more affordable for them. Beats foreclosure, doesn’t it?
So what about you? Have you been wondering how the shifting market has affected the value of your Denver-area home? I encourage you to take courage, be bold, and FIND OUT YOUR HOME’S VALUE instead of worrying about it. We’ve faced challenging times in the job market and Real Estate market over the past few years, but wonderful things are happening in Denver and all over the country. People who were clinging to the shirt on their back are finding that the market is now in their favor and they can make the move they’ve been putting off.
Drop a line and let me know what Real Estate questions are topmost in your mind. I’m happy to help you make informed decision about the home you own, or the one you want to.