From Omaha, we go west to Denver’s Highlands’s Ranch where a tandem team of Dave Bovard at ReMax Masters and Tom Johnson of Advanced Property Management, contracting and managing properties, have put together a successul track record for investors. Expansion into other Denver south metro markets is underway. Eligible properties meet specific standards of square footage, condition, location, and price from a purchase perspective, plus an investor’s return on equity analysis for the rental income. The double edged recipe has worked extremely well. Each single family home must score an “A” to fit the standards for both short term and long term investor requirements.

Historically low rental property vacancy rates will continue for single family properties since high demand for medium to upscale homes is a Plan B for those not able to qualify for a mortgage. Today, renters’ incomes are in recovery as they rebuild their credit. Meantime, attractive homes are renting in days for $1,800 per month and more.

You’re not an investor yet? First time home buyers can follow Buffet’s suggestion in a two step process. Instead of dialing in your Dream Home over $300,000, consider the $250,000 range, later converting to rental property as you move on to the next home. Applying Warren Buffet’s recommendations to today’s housing opportunities can make you a winner in a complex investment world. See entire 22 minute CNBC interview with text at www.cnbc.com/id/46541258.

In 2009, Buyers were getting an average 2% seller discount compared to 2.9% in 2011.  The key factor in greater discounts market wide is that bank owned, short sale, and pre foreclosure properties are a larger portion of the entire market.  Based on the 2011 median price of $211,000,  that creates a  $1,900 wider gap between List Price and Sold Price.  Not shown is another dimension of “discounts” in seller net, the seller paid portion of buyers’ closing costs, easily another 2%, depending on the price range of the home. This is a good example of the average trend losing its accuracy at some point, where individual neighborhood dynamics can be significantly above or below the broad brush market average. List Price in this graph is not the original price, but the current asking price, or the most recent List Price.  Sellers love to “test” the market and start high, creating an inflated asking price so that the original price to sold price is not 97.1% as shown above, but typically 88% instead.  (graph credit to Metrolist)

Price Mix in June 2011 residential sales shows the strength at the core of the spectrum, $200,000-300,000, at 27% of the entire market’s Buyers, the single largest group. Trailing off quickly at $500,000 and above, the top tier group makes up only 10% of the market. A classic bell curve trend that shows the $100,000- 200,000 range combines for a total of about 25%. Denver’s Median Price in the lower $200,000’s is not addressed, often reported less accurately as the Average Price in the upper $200,000. True center of market, the median, includes the upper price sales, but is not swayed by their pushing up the average.

All transactions in this sketch are single family residential, excluding condos completely.