Rising rents are forcing renters to outspend homeowners on housing costs. Since 2005, homeowners’ housing expenses have climbed from 31.9% of their household budget to 33.2%. However, renters’ expenses have jumped from 35.6% to 38.4% during that same time period, according to the October CoreLogic U.S. Housing and Mortgage Trends. Read article:
http://realtormag.realtor.org/daily-news/2011/10/26/renters-spending-5-more-home-owners
Scott Dergance and Jonathan Coppin of Denver-based company Elemental Living design and manufacture modern furniture guided by eco-friendly principles. Both are trained architects that worked on commercial projects that had them crisscrossing the globe. In 2006 they decided to launch a Elemental Living, through which they’re devoted to creating simple furniture forms that will enhance and simplify life. They provided us with a glimpse into a typical day of two guys making it on their own.
As is the case most mornings, both Jonathan and I start our day eating breakfast with our families and getting the kids off to school. We live about 25 miles apart, so we often work from home early in the day before meeting up at the shop or other locations.
I’m working on a small study model for a new dining chair design we have been developing. With our architectural backgrounds, building scale models of our designs has always been part of our process. On any design, we move from big idea hand sketches, to 2D drawings, to physical models, to 3D computer models, and then finally to production drawings. We will be building prototypes of this chair shortly.
The major event of the morning is a photo shoot for the 2012 catalog. This shot is one we took of the set up for our Ilex Lounge Chairs. The chairs pictured look fabulous in walnut and wheat fabric with sky blue legs. We’ll be sending these two chairs to Bobby Berk Home stores in New York City and Miami as soon as we are done photographing.
Like most days, today we will wear many hats and shift gears a number of times throughout the day to get done what needs to be done. After the photo shoot we head to our shop to start putting together Ilex tabletops. These particular tops are being built to fulfill orders from the Fab.com sale from a few weeks back. Jonathan is cleaning up the edges of some American walnut on the joiner before we start laying up the wood to glued.
It is hard to believe it is already lunchtime. In fact, we are taking a late lunch today at one of our favorite eateries, Chipotle, which is actually Colorado-based. We love the food, but there’s one thing we’d like to change: We think they need some new chairs. We just happen to have one in the back of our truck that would work beautifully. What do you think?
The reason we had that chair in the back of our truck was because we were on our way to a meeting with our metal parts supplier, Majestic Metals. We talked with them about the steel parts we need to start producing out goods in larger numbers. They gave us a tour of their facility and we were very impressed. Jonathan and Doug from Majestic are watching this amazing robotic press brake fabricating parts. Majestic prides itself on being on the leading edge of technology and we love that because it means we get superior quality furniture.
Here we are driving on I-25 from north of Denver to our next meeting ten miles south of Denver. Since all but one component in our entire line of furnishings is produced in the Denver metro area, we spend a lot of time driving around town. Being American made and local is what Elemental Living is all about. It allows us to personally touch every piece and part of furniture we make. That means higher quality for our customers.
Our next meeting is with the guys at EliSons Workshop. These guys are great at custom mill work. We hope to strike an agreement for them to produce many of our case goods. Jonathan and I are discussing some production drawings of the Veridis line of storage and shelving with Ben from EliSons. We are using the CNC router as a conference table.
It is now early evening; time to change gears again. We make a quick wardrobe change in the parking lot before heading back into town. A change of clothes (something nicer than shop gear) can often be found in the back seat of our cars. Today is no exception.
We head back into town with just enough time to stop in at Hillstone, one of our favorite restaurants, for a quick appetizer and a beer. We love its fabulous architecture and décor. Note the awesome Republic of Fritz Hansen stools at the bar. The places we like to frequent usually have excellent furnishings. Go figure!
This evening’s event is a special one. The Denver Film Society holds a great Architecture and Design Film Series every year. Tonight is an even bigger deal: it’s the world premiere of a new documentary on Charles and Ray Eames, and we have tickets to attend. Eames: The Architect and The Painter is a visually stunning and very high quality film about the two most influential furniture designers of the 20th century. Co-director Jason Cohn is at the premiere as well and participates in an interesting Q&A after the screening.
After the screening there is a reception at Encore Restaurant next door to the Denver Film Center. Due to our rushed afternoon and evening, we are both starving. While we wait for some appetizers to arrive, we catch up with William Logan (just out of frame), the publisher of Modern in Denver magazine. Our Ilex Lounge Chair and Ottoman made the cover of the latest issue. Talking with people like William is why we come to these events. We don’t get home until after 10 PM, which isn’t that bad, but it means we missed the opportunity to tuck the kids into bed. Sometimes that’s the price you pay when you are trying to make your company work.
Thanks Scott and Jonathan!
Portrait photo by Trevor Brown, Andrew Clark Studio.
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The Modern Home Tour is coming to Denver on October 22! Denver area Realtors & real estate professionals: We are inviting you to purchase discounted tickets!  Modern Home Tours, LLC is proud to present the first annual Denver Modern Home Tour benefiting Cookies for Kids Cancer. What: 8 stunning Modern homes in the Denver Area When: Saturday, October 22, 2011 (11am to 6pm) The interior and exterior of all of the homes will be open on the Tour. You must have a ticket to enter the properties. Tickets are $22 in advance and $30 at the door on the day of the tour. Tickets will get you into all 8 properties in any order you choose. Denver Real Estate Professionals: Use the promo code “REALTOR” and get $5 off advance tickets (just $17) For more information about the tour and past tours, please visit our website: denver.modernhometours.com We look forward to seeing you on the tour! For more information, feel free to email matt@modernhometours.com |
Mortgage rates today, for the first time, fell below 4 percent for a conventional 30-year,
fixed-rate loan.
But even with the national average rate of 3.94 percent, it probably will not
create a frenzy of home buying and refinancing, said local experts, reacting to
the Freddie Mac mortgage-market survey.
Freddie Mac also reported the the average 15-year fixed-rate mortgage fell to a historic low of 3.26 percent, while 5-year ARMS and 1-year ARMs, averaged 2.96 percent and 2.95 percent, respectively.
Rates hit historic lows following a “sharp drop in 10 -year Treasuries…as
concerns over a global recession grew,” said Frank Nothaft, vice president and
chief economist, Freddie Mac.
“In a typical market, I would say, absolutely, yes, this would convince a
huge number of people to refinance or buy, but not in today’s market,” said
economist Patty Silverstein, principal of Development Research Partners in
Littleton.
“Rates aren’t the issue,” added Silverstein, who also is the consulting chief
economist for the Metro Denver Economic Development Corp. and the Denver Metro
Chamber of Commerce. “There is still too much of a fear-factor out there, if
you will. And that becomes a self-fulfilling prophecy to a certain extent.
Consumers need to regain their confidence before they feel comfortable buying a
big-ticket item like a home.”
However, if someone qualifies for a super-low mortgage rate – typically
reserved the most credit-worthy borrowers, who need equity in their homes to
refinance – savings can be substantial.
Dumping a 5.5% loan
For example, the principal and interest on a 30-year, fixed rate at 3.94
percent for a $275,000 mortgage is $1,303, $258 a month lower than the $1,561
for someone with a 5.5 percent mortgage.
That means someone who refinanced even a few months ago might consider
refinancing again at these new rates.
“I really believe that this is an unique time in our history,” Pete Lansing,
president of Universal Lending, said late last week, before rates fell to the
new lows announced today.
“At these interest rates, it is going to be an unprecedented time to
refinance or purchase a home,” Lansing added. “If someone in any way thinking of
buying a home, it might be a good idea. Why wouldn’t you? Not only are mortgage
rates at never-seen before rates, but home prices are at affordable levels.”
Low rates make housing a good long-term bet
He said even if home values dropped a bit, it would be worth it to lock-in
today’s rates, if you planned to stay in your home long enough to see it rise in
value.
However, Lansing said that anyone considering refinancing has to make sure
they will stay in their home long enough to recoup the expense. Since the cost
of refinancing a mortgage typically comes from quity of a home, the borrower has
to make sure a refinance makes sense for them, he said.
Shannon Peer, of Brothers Redevelopment, said some homeowners may be
reluctant to refinance, even if the numbers pencil out.
“Let’s say you received a 6.5 percent interest rate seven years ago,” Peer
said. “You’ve paid $40,000 or $50,000 in interest on your loan. Some people may
not want to go back to a 30-year loan. I think the goal of a lot of people is to
eventually pay off their mortgage to realize the value of their investment.”
On the other hand, he said some people may find any monthly savings enticing
and will want to take advantage of anything that puts money back into their
pockets. “Some people may even want to save $50 a month, even if they calculated
the real cost, it may not be in their best interest,” he said. But Peer
cautioned that people considering refinancing should weigh the economics and
consider what their long-term and short-term goals are as a homeowner.
Jim Lewis, of America’s Mortgage, said he hopes people will take advantage of
the incredibly low rates, but is not certain that will happen.
“They really are pretty amazing. The question is, where do we go from here?
The Fed has said they want to keep long-term rates low for the foreseeable
future, and they are doing that,” Lewis said.
Jobs key
However, jobs still trump mortgage rates, no matter how low they fall, he
said.
“Everybody from President Obama on down talks about the need to create good, high-paying jobs, but it doesn’t seem to be happening,” Lewis said. “Until people are more economically comfortable, they are not willing to take on more debt. I’m hopeful that people will start to take advantage of these sub-4 (percent) loans to buy new and existing homes and refinance, but I think a lot of people are going to be sitting tight until the job market improves.”
Housing consultant S. Robert August, however, said he thinks the record-low
rates provides an opportunity for home builders to court renters to buy their
start-up homes.
“With rates this low, it makes more sense to own than to rent,” August said.
“The low rates won’t have an immediate impact, but it will start to happen as
people’s leases expire in the next three to four months.”
August also said he expects that some builders might be willing to pick up
the cost of two or three months of rent for buyers. Also, because the rental
market is so strong, some landlords will allow existing tenants so sub-lease
their apartments for a few months, he said.
August said that every time a rate falls below a whole number, no matter how
incremental of a drop, it provides a bit of a psychological incentive to buy a
home.
“The catch is, I don’t think most people realize how low rates are,” August
said. “Part of that is the education process. We need to get the word out
regarding these rates.”
Meanwhile, a flurry of refinancing may not pump as much money into the
economy as it has in past years, as people may be reluctant to go on a buying
spree, economist Silverstein said. Instead, they may use the savings to pay down
existing debt or put away more for retirement, which is good for the economy
long-term, but doesn’t provide a huge catalyst to the economy like using the
money to buy flat-sceen TVs or new cars would.
Still, even if homeowners are conservative with money they save from
refinancing, it boosts the economy, she said.
“If households use their extra cash to pay down debt, save for a rainy day,
or save for retirement, this behavior would not have immediate impacts on the
local economy,” Silverstein said. “However, from a macro-level, that money that
is received by the credit companies, or banks, or investment brokers represents
income for them that may be turned into additional spending by them. Or, the
banks may then be able to loan more money to businesses. So, ultimately, the
overall economy will benefit from the “freeing up” of those extra dollars. the
distinction is how far into the process you need to reach before you start to
see the impacts.”
A new multi-family rental project will break ground this month in central Denver’s booming Lower Highland district. The infill development, currently named 1560 Boulder Street, will be located at the corner of 16th and Boulder streets on the vacant lot across from the popular restaurants Lola and Vita. Here’s a recent Google Earth aerial view of the block:
As part of the small section of the Downtown street grid that’s located west of the South Platte River, the block’s history goes back to the city’s founding when General Larimer staked out a new town called Highland in December 1858, a few days after the founding of the towns of Denver City and Auraria, east of the river. The Town of Highland extended from the mighty Platte west to Zuni Street, the area today known as Lower Highland. In 1860, the three towns consolidated into a single municipality named Denver. Fifteen years later, in 1875, the Town of Highlands (with an “s”) was incorporated, covering the area west of Zuni Street over to Sheridan Boulevard. The Town of Highlands lasted until 1895, when it was annexed by Denver. But I digress… back to 16th & Boulder.
Given its historic roots, the site wasn’t always vacant, of course. Buildings once occupied the site in question. After searching the extensive online historic photos archive at the Denver Public Library, I found an image that gives us a good glimpse of the buildings once found along this side of the block. First, the entire photo is shown below (credit: Colorado Historical Society). The building on the right is the original Olinger Mortuary building, now home to Lola and Scarlet Salon. This photo is from the 1940s.
After a bit of zooming and cropping in Photoshop, here’s a close-up of the site. Click to embiggen:
As to when these buildings were demolished? May have been the ’70s, ’80s, or ’90s… I’m not sure. If anyone has info on this, please let me know.
Here are two views of the site today, with the one photo showing the stairs and retaining walls from the old homes still in place:
In the mid-1990s, the block (excluding the historic building at 15th & Boulder) was rezoned as a PUD (Planned Unit Development) that called for a total of six new buildings: two along 15th, one mid-block facing Central, and three along 16th Street. The first three of these buildings (two along 15th and one facing Central) were built in the late 1990s as the Overlook. In 2008, the fourth building was completed—the Highland Bridge Lofts—at the corner of 16th and Central, which features the ground-floor businesses of Living the Sweet Life and Masterpiece Delicatessen. 1560 Boulder will complete the plan for the block.
Now on to the new project…
1560 Boulder is being developed by Holland Partners Group of Vancouver, Washington, with Denver’s Sprocket as the architect. The project will consolidate the two remaining buildings in the block’s PUD into a single five-story, U-shaped building, with the open end of the “U” facing the interior of the block, as seen in this site diagram submitted to the city as part of the project’s development application:
Due to the site’s significant slope, two levels of structured parking will be mostly underground…tucked into the hillside. Ground-floor retail (with outdoor patio space) will anchor the project at the corner of 16th & Boulder. Four levels of residential apartments, a total of 130 units, will top the ground-floor uses, with a swimming pool, clubhouse, fitness center, and rooftop deck as project amenities.
The exterior design is still being refined, but here’s a preliminary rendering of the project, courtesy of Erik at Holland Partners and Matt at Sprocket Design. The building facade will be constructed of masonry, metal, and stucco:
Holland Partners is planning to break ground on the project this fall, with completion scheduled for 2013.
This exciting project completes the development of a prominent block on the edge of Downtown Denver, and will further enhance the vitality of one of Denver’s most vibrant districts.
