Wealth in Colorado Springs (for sale, real estate, foreclosures)

[Mamameko]

This isn't really a question. I just have been looking at various realty sites for houses to rent and am amazed at the number of multi-million dollar homes I see for sale in Colorado Springs. I didn't realize there was that kind of wealth in the area.

[Vision67]

Perhaps they are a bit less rich if they are trying to dump their mansions. Now it takes more than fog on a mirror to get a loan; especially a jumbo loan that many of these properties would require.

I expect a ripple effect, deflation in housing prices at every level.

[Bob from down south]

Originally Posted by Mamameko

This isn't really a question. I just have been looking at various realty sites for houses to rent and am amazed at the number of multi-million dollar homes I see for sale in Colorado Springs. I didn't realize there was that kind of wealth in the area.

The size of your mortgage really hasn't been a good indicator of your wealth in the last 5-10 years.

Truth is, until mid 2008 a $100K income could easily get someone into a million dollar house with a teaser-rate pay option ARM. Continuing to make the payments after their "exploding ARM" recasts is a different story entirely...

I expect to see heavy pressure continuing to build in the mid-to-upper level price levels as debt-overloaded homeowers (sic) slowly sink beneath the waves. The $400K and up segments of the Colo Springs markets have been essentially comatose for two years and counting.

[vfrpilot]

From what I am told by a friend in real estate, most of those high end homes are foreclosures. Like Bob said above, the 'appearance' of wealth was easily attained a couple of years ago. Sad thing is, a lot of those folks could've been sitting pretty in very nice homes but chose to buy mansions at the upper limit with dangerous mortgages.
For grins we toured a 13k square foot foreclosed home in King's Deer. Asking price was a bargain at less than $100 per square foot, even with a 2.5 acre lot. I marveled that someone with that much house could be in a position to lose it. The agent said there are many more.

[treedonkey]

Additionally, lot of people have migrated here from states where they may have sold their property for a net profit of what seemed to be a lot of money (meaning six figures, but not seven). They then have used that cash to get into a million or multi-million dollar home. It may look good on paper, but when the reality of a reduced income sets in they may be unpleasantly surprised.

Originally Posted by vfrpilot

For grins we toured a 13k square foot foreclosed home in King's Deer. Asking price was a bargain at less than $100 per square foot, even with a 2.5 acre lot. I marveled that someone with that much house could be in a position to lose it. The agent said there are many more.

I honestly don't understand how anyone thinks they'll be able to heat, clean, furnish and maintain a 13k sq. ft. place without going broke in both time and money, much less pay a high mortgage at the same time, but I suppose anyone that is foolish to get an ARM on a million plus home is probably not prudent enough to pre-consider all of those other costs either.

[Mamameko]

Thanks for all the insight. Makes more sense now and explains why so many of these homes are listed for sale. I'm only familiar with the housing market as it is in rural Michigan. When the boom hit and people started buying homes out of their reach they were 3,000 sq. ft. homes going for $400K. Not 13K sq ft and certainly not costing millions of dollars.