Buyers Are Out Shopping - Meaningful Market Update

This summary is written by Michael Orr, creator of The Cromford Report. Michael also works for ASU analyzing the real estate market for their real estate school.

Here are the most significant stats. They are averages for the entire Valley and some areas are higher or slightly lower:
• Single family home prices are up 27% from September 2011 and continue to rise.
• Average price per square foot is up 23%
• Townhome/condo prices are up 33%
• Average ppsf is up 16%
• Overall supply was down 21% at the start of October and distressed supply was down 58% from October 2011.
• In the last 3 months, overall supply has increased 24%
• Foreclosure starts fell by 18% between August and September 2012 and are down 40% from September 2011.
• The percentage of residential properties purchased by investors remains high but is now in a downward trend.

The housing market usually slows down between Thanksgiving and New Year’s but with the prediction of another housing price bubble this Spring, many buyers are still out shopping. We are hoping that January will bring a good supply of homes to the market as supplies at many price points are running low. The rumors always fly that big banks are holding back foreclosures until the holidays are over, but it has yet to actually occur in Phoenix. Even if it should, bidders are still very active at trustee auctions and 45% fewer homes are reverting to lenders. That keeps foreclosures from coming into the active market.

Phoenix continues to be one of the fastest improving housing markets in the nation. Appreciation throughout the Valley has been high this year ranging from 26% to 34% when compared with 2011. Each zip code and neighborhood has to be studied individually for home owners to know whether they have equity again. As always, let us know if you want us to run comps for your home and we will be happy to do so. You may be pleasantly surprised!! And if you are thinking of selling or buying, now is a great time to act. Interest rates are still low but we do not know how long they will stay down.

Call or email with your questions and, as always, send buyers and sellers our way. We take very good care of all of you.  We are Family Serving Families!

Just Listed for $165,000 | 3 bed/2 bath | Glendale, AZ

This move-in-ready home has: fully updated floors (2011), fully updated roof (2011), partially updated kitchen (2011), partially updated pool (2012). Other updates include: new insulated garage door, new blinds & ceiling fans, private enclosed patio, interior & exterior paint including the back wall, solar hot water, newer AC and new sand pool filter. This beautiful home is situated on a large corner lot - one of the largest lots in the neighborhood. Home has received regular termite treatment and is under warranty. Great location near Thunderbird School of Global Management, Midwestern Medical School, Banner Thunderbird hospital, etc. Easy access to the 101 and I-17.

Click here to see the virtual tour.

Home Sold in Less Than 30 Days! Closed in Just 2 Weeks!

Congratulations to the Glassman family (yes, to me) for selling our rental property in EncantoBella after a four year wait for prices to rise! It took two weeks, skillful negotiations, and an excellent selling agent to put this deal together. Make sure you have Sammy on your team and give her name to your friends and relatives! The pricing bubble is happening now (see recent articles in Arizona Republic) so let’s get those listings on the market!

Family Serving Families - Transitioning Elderly Parents

CONTINUING OUR “FAMILY SERVING FAMILIES” FOCUS

After helping so many adult children deal with the stress of moving a parent into assisted living and selling a home to pay for the new living arrangements, we want you to know about one area of focus: we help transition your elderly parents.

Our team includes:
• Realtors that can sell the home quickly and for the best price
• A professional company that works with the family to place a loved one in independent or assisted living
• An expert in estate sales to clean out the house and sell, dispose or donate goods
• An Elder Law attorney who also works with ALTEC and VA benefit applications
• A financial planner to help with income projections and planning needs
• An accountant to help with tax issues for the elderly

Our team for selling the home includes:
• Contractors and handymen for updating or repairs
• Landscapers and tree trimmers
• Network of investors that buy homes “as is”

This situation happens with no notice so it is imperative that adult children have great contacts for when that call comes in the middle of the night or when the doctor says that Mom or Dad cannot live alone anymore.

Click here for checklists and questions to ask.

We have been able to sell the homes and condos quickly and for a good price even in a bad market! Our clients have loved that we can lift so much off their shoulders, especially those that live out of state. It is a labor of love and we want to do more!

NOTE: If you hear of anyone that has elderly parents who are still caring for a home and would benefit from a move into independent or assisted living, please call us.

Home Rented...Another Family in their Home

Congratulations to Joseph Hsu on the one-year rental of his beautiful condo at The Pointe! With rising home and condo prices in Phoenix, our hope is that one year from now the condo value will be higher and he will have the choice to sell or rent! Let’s hope that the Phoenix housing market continues to lead the nation!

Another Home Sold...Another Donation Made!

Home sold for more than list price in 2 days with 15 contracts!

Our heartfelt congratulations to Valarie and Mary on the sale of their grandmother and mother’s home! The referral was made through angel mama’s and it has been a labor of love to remove a small part of the stress they have been under. Moving a parent into assisted living, cleaning out and selling her house, then moving another family member into assisted living and coping with cancer treatment … no one should have to deal with so much. But Mary and Valerie have done it with grace and love, perspective and a sense of humor! It has been a pleasure for us to help them with this one small task!

 

And, thank you to buyer’s Carrie & Ryan Lehrman for making the process so quick and easy.

 

A donation will be made to angel mamas in honor of this sale.

 

Meaningful Market Update....Information You Can Trust!

 

September 5, 2012

During August we continued the market's three month wind-down following its springtime frenzy. The basic numbers for September 1, 2012 relative to September 1, 2011 for all areas & types across ARMLS are:

• Active Listings: 14,405 versus 19,216 last year - down 25% - and up 7% from last month
• Pending Listings: 10,125 versus 11,508 last year - down 12% - and down 3% from last month
• Monthly Sales: 7,573 versus 8,470 last year - down 11% - and up 3% from last month
• Monthly Average Sales Price per Sq. Ft.: $97.45 versus $79.64 last year - up 23% - and down 0.7% from last month
• Monthly Median Sales Price: $145,700 versus $109,900 last year - up 33% - and up 0.6% from last month

The average price per sq. ft. for sales is up 23%!! The luxury market has had its usual quiet summer which means pricing has taken 3 steps back having taken 26 steps forward between September 2011 and June 2012. (The luxury market controls pricing at all levels; when luxury sales go up, prices go up and vice versa.)

Greater Phoenix REO sales are once again below 14% of the monthly total. At their peak on February 11, 2009, they constituted 71.1% of monthly sales. Although it will take some time for them to disappear completely, REOs are no longer a major factor in the market.

In contrast, short sales comprised 30.4% of all sales in Greater Phoenix in August.

Normal sales have risen from 55.3% to 56.1% of sales.

Supply continues to increase gently, in line with seasonal patterns, though supply is increasing much faster in locations like Queen Creek and Maricopa. In contrast the luxury market areas have seen supply declining or steady. Overall we still have nowhere near enough supply for a housing market the size of Greater Phoenix.

Those looking for bad news to celebrate can rejoice in the increased rate of completed foreclosures, but from our perspective this has no real long term significance. It is just reducing the pool of pending foreclosures much faster than in the first 7 months of 2012, and eliminating delinquent loans faster than they are arising. This is because the new notices of trustee sales are down from 3,389 to 3,344. This looks like a small decline at first sight, but remember that August had 2 extra working days over July so the daily rate declined more than 10%. It seems that Bank of America has realized that with REOs easy to sell and prices rising, taking them into inventory is not such a bad idea. At present no other lenders seem to have followed suit. However, Bank of America represents some 25% of the foreclosure pipeline and investors on the courthouse steps are no doubt dismayed by the reduction in buying opportunities.

The result will be a small increase in REO inventory (about 15%). Do not get too excited: no doubt there will be at least 10 offers for most of properties listed.

The short supply will probably feel slightly less of an issue during the rest of the year when demand is relatively low, but if we enter next year's spring buying season with our current level of supply, we are likely to see fireworks again between February and May with rising prices. It will be interesting to see how much the new home builders are able to gear up for this opportunity. If they can increase capacity this might put more homes into the supply and limit the upward pricing pressure. However, they currently face a constrained supply of vacant lots under developer ownership and very limited number of trained and available tradespeople in most of the key construction disciplines.

After a relatively quiet summer spell, the next 9 months are going to be very interesting to follow!

Source: The Cromford Report, Michael Orr

Meaningful Market Update....Information You Can Trust!

MONTHLY REPORT – GREATER PHOENIX HOUSING MARKET – JUNE 2012
(published August 8, 2012 by Michael Orr)

Headlines:

• Single family home prices were little changed between May and June 2012 but are confirming a significant recovery when compared with June 2011:
       o The median sales price is up 29.3% from $116,000 to $150,000
       o Average price per square foot is up 21.3% from $80.85 to $98.11

• Townhouse/condo prices behaved similarly between June 2011 and June 2012: o The median sales price is up 32.3% from $68,000 to $90,000
       o Average price per square foot is up 20.8% from $81.66 to $98.66

• Overall supply (excluding homes already under contract) is down 33% on August 1 2012 compared with August 1, 2011, and distressed supply is down 68% over the same time frame.

• Foreclosure starts on single family and condo homes fell 14.9% between May and June 2012 and were down 12.1% from June 2011

• Recorded trustee deeds (completed foreclosures) on single family and condo homes were down 14% between May and June 2012 and were down 56% from June 2011

• 69% fewer single family homes reverted to lenders at trustee sale compared with June 2011

• Sales of single family homes were 15.7% lower than in June 2011, constrained by lack of supply

• The percentage of residential properties purchased by investors continues to rise

• Single family home sales increased year on year for
       o New homes (up 39%)
       o Normal re-sales (up 59%)
       o Short sales and pre-foreclosures (up 8%)

• Single family home sales reduced year on year for:
       o Investor flips (down 16%)
       o Bank owned homes (down 62%)
       o GSE (Fannie Mae, Freddie Mac, etc.) owned homes (down 81%)
       o HUD sales (down 53%)
       o Third party purchases at trustee sale (down 35%)

Unless otherwise stated all the statistics shown are for Maricopa and Pinal Counties combined.

Metro Phoenix home prices ebb

Metro Phoenix home prices ebb

Meaningful Market Update....Information You Can Trust!

July 16, 2012 4:45 PM

Phoenix Sets Pace in National Real Estate Recovery

PHOENIX — The Phoenix metro housing market is seeing a rise in home prices and a decline in the number of houses on the market, putting the area ahead of most other U.S. cities on the road to recovery, according to real estate experts.

Economists say the upward trend in the Phoenix area may serve as a beacon of hope for other cities across the nation that suffered when the housing bubble burst.

"The Phoenix market will be a benchmark city to monitor for residents in Las Vegas, the Inland Empire of California and ... the Florida market," said Lawrence Yun, chief economist with the National Association of Realtors.

The median price for Phoenix-area homes in May was about 30 percent higher than it was the same time last year, according to a monthly report released by the W. P. Carey School of Business's Center for Real Estate Theory and Practice at Arizona State University. The report also shows there are about half as many houses on the market as there were the same time last year.

The Phoenix area market was one of the hardest hit in the nation in terms of distressed properties, but the state's foreclosure system allows it to work through the backlog more quickly than states in which foreclosures have to go through the judicial process. Banks and mortgage companies have the power in Arizona to foreclose homes without a judge's approval.

Nevada's foreclosure system is largely the same. Nasser Daneshvary, director of University of Nevada, Las Vegas's Lied Institute for Real Estate Studies, said speedy foreclosures are healthy for the market. Too many foreclosures can sink home prices, as happened in both Phoenix and Las Vegas, but Daneshvary said a return to the depths experienced during the housing collapse isn't likely in either city.

Arizona's job market, with an unemployment rate that's down to 8.2 percent from its March 2010 peak of 10.8 percent, is also a factor in real estate improvements. Yun said other areas that have sluggish job markets are likely to see slower real estate recoveries, with fewer people able to buy homes.

Michael Orr, director of the Center for Real Estate Theory and Practice at ASU's Carey school, said dwindling housing inventory, coupled with prices that are still relatively low, means sellers now hold the power in the Phoenix-area market, and receive multiple offers, many of which come from investors who are looking to buy and rent out houses.

"Now we've got too few homes. Everybody's wishing the investors would go away and stop buying, but the investors are still here buying everything they can with cash, which makes it pretty difficult for ordinary home buyers to compete," Orr said.

Sandy and Luis Solis said they found that to be true. The couple, who moved from Los Angeles to Scottsdale last year, said the rapid decline in homes available in their price range made them feel hurried to buy. They made offers on three homes but were outbid by cash offers twice, the second time by an investor. They're in the final stages of closing on a house in Phoenix.

"We were kind of losing hope that we were going to find the right home for us," Sandy Solis said.

Las Vegas and some cities in California are seeing similar situations. Daneshvary said investors who buy housing for the purpose of renting are better for the market than others in the past who have purchased houses just to flip them. He said by the time investors stop buying, the market will be healthy enough to remain stable.

With houses in short supply, the construction industry will step in to fill the void. Orr said home building in the Phoenix area is slowly beginning to pick up, but it will likely be stifled by a shortage of construction workers in the state. He said Arizona has lost "80 to 90 percent of that skilled workforce" in the last six or seven years because workers have gone elsewhere or left the industry altogether.

Orr said the Phoenix-area's home market recovery will likely level out over the next few months.

"I just don't want people to think the next quarter is going to accelerate at the same rate," Orr said. "That's not likely to happen."

That, Yun said, is a sign that the market will recover in a more healthy way.

In the long term, some city's housing markets may end up in better shape than they were before the housing market crash. Yun said parts of Texas, Oklahoma, Nebraska and the Dakotas didn't experience huge housing market losses but are benefiting from widespread improvements in economies.

© 2012 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.

Another Family in their Home...Another Donation Made!

We are so pleased that Elizabeth and Vernon Lewis were able to build the home that they wanted and that would fit their specific needs. They have waited patiently for it to be built and we know this home will mean the world for them. Our sincerest wishes for many years in their brand new Pulte home!

In honor of their purchase, a donation has been made to Angel Mamas.

Drs. Zoe Milagros Gonzalez-Garcia and Benny Cartegena Hernandez have had quite a year: a new baby (David), two new jobs, and a move from Puerto Rico to Arizona! And in the midst of their new home purchase, a change of lenders that started their process all over again. But the end result is a fabulous home where they can raise their beautiful son and entertain all of the relatives that are sure to visit!

In honor of their purchase, a donation has been made to Phoenix Children's Hospital.

Meaningful Market Update...Information You Can Trust!

MONTHLY REPORT – GREATER PHOENIX HOUSING MARKET – MAY 2012
(published June 27, 2012 by Michael Orr)


Headlines:


Single family home prices have risen quickly and are now far higher than in May 2011:

     The median sales price is up 32.4% from $111,000 to $147,000

     Average price per square foot is up 22.2% from $80.30 to $98.14


Townhouse/condo prices have increased by a slightly larger percentage:

     The median sales price is up 37.3% from $69,900 to $96,000

     Average price per square foot is up 23.1% from $84.89 to $104.05


Overall supply (excluding homes already under contract) is down 50% on June 1 2012 compared with June 1, 2011, and distressed supply is down 80% over the same time frame.


Foreclosure starts on single family and condo homes rose 1.2% between April and May 2012 and were up 5.2% from May 2011


Recorded trustee deeds (completed foreclosures) on single family and condo homes were up 18% between April and May 2012 but were down 52% from May 2011


71% fewer single family homes reverted to lenders at trustee sale compared with May 2011


Sales of single family homes were 5.8% lower than in May 2011, constrained by lack of supply


Single family home sales increased year on year for

     New homes (up 57%)

     Normal re-sales (up 74%)

     Short sales and pre-foreclosures (up 15%)


Single family home sales reduced year on year for:

     Investor flips (down 4%)

     Bank owned homes (down 46%)

     GSE (Fannie Mae, Freddie Mac, etc.) owned homes (down 76%)

     HUD sales (down 67%)
    
     Third party purchases at trustee sale (down 16%)



Unless otherwise stated all the statistics shown are for Maricopa and Pinal Counties combined.

Another Family in their Home...Another Donation Made!

We have been so blessed with wonderful clients, fabulous lenders, experienced inspectors and great title officers. Taking a team approach for our buyers has given us the ability to move buyers and sellers forward in the process as we work towards closing each one. The government has enacted multiple new rules that cause delays and roadblocks in the buying and selling process. We feel very fortunate that we have assembled a skilled and caring group of individuals to help reduce the stress for our clients. The best news is that every family ended with the home they wanted!

Congrats to Drs. Matt Bean and Alicia Ogram on their new home! It is just right for them as they prepare to welcome two more into their family! They found a great property after two days of home hunting and some thorough inspections. We wish them years of happiness and enjoyment!

Not everyone rates a new grandchild and a great condo within bike riding distance! Careful shopping and patience paid off for Vicki and Wayne Benson and they found just what they wanted in Scottsdale! Congratulations and here’s to more babies!

Anna and Brian (and all of their fur faces) knew what they wanted but had been told by another agent that it just was not out there. Not on our watch! They helped us understand their wants and needs and we helped them eliminate the properties that just were not right for them. When they found The One, they saw the potential and knew they were home! We can’t wait to see it after all of the projects are completed!

Dr. Katie Peterson (center in photo) has the patience of a saint for slugging through a loan process that turned on her! It’s a story she will be telling her grandkids when they ask about buying her first home in Phoenix! Congratulation is not a strong enough word for this closing! YOU DID IT!! Bless you!

Our sincere congratulations to Dr. Christina Smarik on her beautiful new home in Scottsdale’s “magical zip code.”  Shopping for a home was a family event and with everyone’s blessings (and after a few trips to the roof!) Christina has a home she can love for many years to come!

Meaningful Market Update....Information You Can Trust!

No relief is yet in sight for buyers as inventory continues to fall to even lower levels. Sales and pending counts are down due to the lack of enough supply to meet demand. With demand outstripping supply by a wide margin, prices continue to rise substantially each month.

Let us look at some basic numbers for April 2012 relative to April 2011. So for all areas & types across ARMLS we record the following:

• Active Listings (excluding AWC): 13,117 versus 27,052 last year - down 52%
• Active Listings (including AWC): 20,781 versus 34,594 last year - down 40%
• Pending Listings: 11,996 versus 13,326last year - down 10%
• Monthly Sales: 8,480 versus 9,452 last year - down 10%
• Monthly Average Sales Price per Sq. Ft.: $95.79 versus $83.61 last year - up 14.6%
• Monthly Median Sales Price: $137,000 versus $110,000 last year - up 24.5%

With prices fairly flat during the first half of last year but rising fast this year, the appreciation measurements are on their way up to eye-popping levels. The monthly average price per square foot is the more conservative measure, but already shows appreciation approaching 15%. We recall that monthly sales $/SF reached a low of $78.83 in September 2011. So if prices were to stay flat from now on we would be measuring appreciation of 22% by September 15, 2012. With no relief in supply, prices are much more likely to continue to rise, so appreciation measurements of well over 25% are on the cards for the fall.

As prices rise, demand loses steam and more sellers are enticed into the market. This is the normal mechanism for a market to reach stabilization. Another would be for a fresh source of supply to arrive on the scene. New home builders are ramping up production, but from an abnormally low level, and they are unlikely to have much impact on the overall supply situation in the short term.  Another theoretical source would be for the banks to release their so-called pent-up "shadow inventory". But since it doesn't exist in Greater Phoenix to any significant extent, this source of supply will remain imaginary.

When you look at the overall active listing counts, the supply situation does not look too dire at first. We have 20,781 active listings in total on ARMLS. However, 7,664 of these are in AWC status so that brings us down to 13,117. Excluding those that are outside the Greater Phoenix area brings us down to 11,828. Excluding those priced at $250,000 or more takes us down to 6,106, and if we restrict ourselves to single family homes we see only 4,069. In the last month 5,443 such single family homes were sold, so the current active supply is only 22 days. One year ago those numbers were 14,036 active and 6,574 sold, so we had 64 days of supply, which was already quite tight. Two years ago we had 15,369 active and 6,236 sold, representing 74 days of supply. That was at the height of the buying spree inspired by the tax credit. At no time since early 2009 has supply been excessive, although there was a worrying upward trend for 6 months in 2010 after the tax credit expired. Now we are in a severe out-of-balance situation which is likely to last until supply starts to increase significantly.

The supply in the luxury market is also starting to decline, as it is in the active adult 55+ areas of the valley. However here it has not yet reached anything we would describe as out of balance.

The Maricopa County foreclosure statistics for April were:

• New Notices of Trustee Sale: 4,448 versus 4,487 in March - down 0.9% for the month
• Trustee Deeds Recorded: 1,739 versus 2,092 in March - down 16.9% for the month

As foreclosures decline it becomes more important to examine the home loan delinquency rate to see what is happening upstream of the notice of trustee sale. The Lender Processing Services Mortgage Monitor report for March shows that Arizona now has 6.1% of its outstanding homes loans delinquent by 30 days or more but not in foreclosure, while 3.0% are already in foreclosure. This compares with 6.6% and 3.0% in February and 7.1% and 3.0% in January. Clearly the percentage of home loans that are delinquent but not yet in foreclosure is dropping fast. In fact it has fallen by over half since peaking in February 2010 at 12.4% and this is a very important number to watch going forward.

Just a couple of years ago Arizona ranked third highest in the nation at 16.3% non-current loans (30+ days delinquent or in foreclosure) when the national average was 13.5%. Arizona now ranks 33rd among the states for non-current loans at 9.1%, well below the national average of 11.7%. In the last month Arizona fell another two places by dropping below the states of California and Washington and now ranks equal to Missouri and just above Texas. These changes go a long way to explain why we are entering a period of sustained recovery in the Greater Phoenix housing market!

Source: The Cromford Report

Another Home Sold....Another Donation!

Congratulations to Chris, Lavina, Sarah & Maya Bahm for staying the course and making it through a difficult loan situation and a delayed Close of Escrow to make it into their new home! We wish them many happy years in their beautiful house and thank them for their trust and perseverance!

In honor of their new home, a donation has been made to Angel Mamas where connecting mothers to support each other and families in our community is their mission.

Meaningful Market Update: Information You Can Trust!

Below is a synopsis of what is happening in the housing market right now. These statistics come from The Cromford Report, the Phoenix area’s most reliable source for data:

Headlines:

 

Overall single family home prices are now higher than 12 months ago:

•  The median sales price is up 8.3% from $115,000 to $124,500
•  Average price per square foot is up 4.1% from $81.07 to $84.36

Pricing has moved higher since reaching a low point in September 2011
Supply is down 42% compared with 12 months ago
Monthly foreclosure starts rose in February 2012 but were still down 9% from February 2011
Overall sales were 9% higher than in February 2011
Single family home sales increased for

•  New homes (up 26%)
•  Normal re-sales (up 63%)
•  Investor flips (up 71%)
•  Short sales and pre-foreclosures (up 34%)
•  HUD sales (up 9%)
•  Third party purchases at trustee sale (up 15%)

Single family home sales reduced for:

•  Bank owned homes (down 40%)
•  GSE (Fannie Mae, Freddie Mac, etc.) owned homes (down 58%)

Foreclosure Starts:

 

We had a big month for foreclosure starts in February 2012, with a jump of 32% from January to 4,907 primarily due to a large batch of new notices issued by two of the larger banks. However, new notices of trustee sales were still down by 9% compared with February last year (for single family and townhouse /condo combined). Our worst month ever for new notices was March 2009 with 11,354, and we are still down 57% from that peak level.

Foreclosure Completions:

 

We can see a dramatic change in foreclosure results when we compare February 2012 with February 2011.

• The number of completed trustee deeds is down by 52%
• The number of homes reverting to lenders is down by 72%
• The number of homes purchased by third parties at auction is up by 18%

So the supply of REOs has been dramatically reduced while the number of homes being purchased by third parties at auction is at unprecedentedly high levels for this time of year!

These numbers show us why the housing inventory is being dramatically reduced in price points below $400,000. We are seeing new homes coming into the market (the majority by individual home owners) but sales are higher than those numbers.

If you want to know more about your specific neighborhood, call us!

Meaningful Market Update: Information You Can Trust!

MARCH 28, 2012- Business Section of Arizona Republic:

PHOENIX LEADS THE NATION!

Phoenix Bucks Trend as Most Home Prices Fall!

An article out of Washington through the Associated Press gave credibility to the improvement of our  housing market. According to The Standard & Poor’s/Case-Schiller home-price index* released Tuesday, home prices dropped from January 2011 to January 2012 in 16 of 19 cities. However, “…Phoenix, Denver, and Detroit had year-over-year price increases” with Phoenix increasing 1.3%. Additionally, most major cities saw a price fall in January for a 5th  straight month except for Phoenix, Miami and Washington.

Even though the news was not good for most major housing markets, analysts are predicting that the U.S. housing market will see higher prices throughout 2012. Stan Humphries, chief economist for housing website Zillow.com said, “The reality is that home prices and home sales will be moving higher.”

What this article does not mention is that our inventory continues to decline at a record rate. Sales are good and listings are slow to come onto the market at every price point. Foreclosures are down over 50% from one year ago and continue to decline. Investors are competing with buyers for properties to fix and flip or rent and many properties are getting multiple offers, some as high as 12-16! First time home buyers in the $250,000 and under price range have to act quickly to secure a property.

We will continue to update you as we see the trends unfolding so that you are ahead of the average newspaper reader. It has taken the national and local news networks 6 months to catch up with what we were telling you last fall! If you or your neighbors, friends, family have been waiting to sell or buy, now is the time to do it! Call us for more information!

*Case-Schiller monthly index covers half of all U.S. homes. It measures prices compared with those in January 2000 and creates a 3-month moving average.

Meaningful Market Update: Information You Can Trust!

The supply of homes for sale is now unusually low below $400,000 and it is clear that pricing can no longer be held down by negative sentiment. Consequently prices are rising at an accelerating rate and unlikely to stop rising until a significant additional supply can be found from somewhere. Where this will come from is not yet clear. The developers can only build a relatively low number of new homes in the near term, constrained as they are by the scarcity of experienced construction employees. The banks are receiving only a fraction of foreclosed homes from the trustees, and REO listings are being added to ARMLS at the slowest rate for almost 5 years. More than three quarters of short sale listings are already under contract, leaving only a couple of thousand of short sale listings unspoken for. Bidding at the trustee sales by third parties is intense. During March we expect 2 out of 3 trustee sales to go to third parties. Prices at the trustee sales are rising fast and many long term professionals are getting outbid by newcomers.

Normal listings are still relatively plentiful, but are being added to ARMLS at much lower rates than usual, so are not even close to making up for the low supply from elsewhere. The only potentially significant new source is if the banks have been holding back sending foreclosure notices to a large number of delinquent homeowners. If this is the case, then the market is telling these lenders: "now would be a good time". There is no shortage of demand to absorb them. Some lenders, notably Wells Fargo, Bank of New York Mellon, US Bank and Green Tree Servicing were indeed stepping up their foreclosure notices in February, but the overall rate of new notices is still considerably lower than in 2011 and unless many other lenders follow suit we cannot expect a significant increase in REOs coming to market.

January had the lowest number (9,908) of new Greater Phoenix listings we have seen for any January since we started counting in 2001. Even 2005 had 10,415 and in those days new builds and FSBOs were numerous but rarely listed on ARMLS.

February had the lowest number (8,695) of new Greater Phoenix listings we have seen for any February since we started counting in 2001. 2005 had 9,282.

March is not looking any better so far from a buyer's perspective. So we conclude that constrained supply is going to be a severe problem throughout the near to medium term.

We currently count 7,259 sales in February across all areas & types in ARMLS. This is up 1.4% from February 2011 and the second highest February total in the last 12 years. Nothing weak about demand there.

There you have it. The Greater Phoenix area is becoming desperate for new listings under $400,000 in almost all areas. (The only market that is still plentiful is the age restricted or the luxury market.) Prices are rising at the low end due to the competing offers and shortage so the prediction is that prices will continue to rise through March. We are seeing appreciation and expect that to grow through April. Remember, we are talking about the $400,000 and under price range here!

As always, if you want us to do an evaluation of your neighborhood, just let us know. And if you have equity in your home and have been waiting to sell, now is the time!

Meaningful Market Update: Information You Can Trust!

YOU HEARD IT HERE FIRST AND IT FINALLY HIT THE NEWSPAPER!

For those of you that have abandoned our local newspaper, you might have missed the headline on the business page last Friday:

          REPORT: FINDINGS UPBEAT FOR ARIZ. HOUSING MARKET

                   Prices Rise, foreclosures are down

We have been seeing this trend for the last year but no one outside of the real estate world believed it to be true. The article goes on to say that “Metro Phoenix home prices are up. Fewer inexpensive homes are for sale, and the number of pending foreclosures are down.” This positive update is a result of ASU’s W.P. Carey School of Business naming Mike Orr director. He is the publisher of The Cromford Report, the daily online analysis of the Phoenix housing market that we follow carefully.

Investors have grabbed the oversupply of homes under $300,000 and there is no glut of homes that the banks are hiding. It may be true for other markets, but not ours. We are still getting foreclosures but the rate has dropped nearly 50%. The supply of homes at all price points in metro Phoenix is down 42% from a year ago.

We are all anxious for home values to rise across the board so that everyone again has equity in their homes. The last indicator to rise will be home prices; it was the last indicator to fall when this meltdown occurred and it will be the last to improve. We have been in this situation since 2007 but it took until 2009 for housing prices to drop significantly. Be patient; they will rise again. We need our luxury market to sell faster and higher (luxury being $1,000,000 and up) and that will pull the rest of the market up.

The supply of homes listed for sale in metro Phoenix is down 42% from one year ago. ARMLS shows that the entire Phoenix metro area has about 15,000 homes/condos/patio homes for sale. Nearly every city has seen a drop in the number of listings with few coming onto the market. There are more listings pending (in escrow) than active and this has been true for a couple of months.

Supply is down, demand is holding strong. In a normal market, prices would rise. We are not a normal market yet but prices are creeping up and we are returning to a seller’s market in some price points. It is still neighborhood by neighborhood and house by house.

Spring and summer are our strongest buying periods so if demand stays this high, prices should begin to follow! Stay tuned for more!! And call us if you want us to look at your neighborhood!

Another Home Sold! Another Donation Made!

It has been a full family project for the Wingos! Shana and Ben shopped and previewed and Bob and Paulette trusted their excellent taste. The result is a fabulous vacation retreat in a gorgeous golf community! We know there will be many happy times together and great memories will be made. Congratulations!


A donation to angel mamas has been made in honor of your new home! Angel mamas' mission is Connecting mothers to support each other and families in our community.

Another Home Sold! Another Donation Made!

Congratulations to the Campbell family on their new home in Scottsdale! Perseverance, determination, and tolerance of old wallpaper and creative plumbing were critical for this sale! Good job, may the redo go smoothly, and we wish you many years of happiness!


A donation to angel mamas has been made in honor of your new home! Angel mamas' mission is Connecting mothers to support each other and families in our community.  

Another Home Sold! Another Donation Made!

Congratulations to Harvey and Paula on the purchase of their new Phoenix home! How wonderful that their daughter and grandchildren will have a lovely home and yard (with no Koi pond!) to share with you. A fabulous family home for a wonderful family! And enough bedrooms for everyone!!


A donation to angel mamas has been made in honor of your new home! Angel mamas' mission is Connecting mothers to support each other and families in our community.

Meaningful Market Update: Information You Can Trust

Some current facts about the Phoenix housing market. According to The Cromford Report, we are headed for a housing crisis unless sellers begin to list their homes. We are declining rapidly every month!

See below for Cromford:

Anyone attempting to buy a residential property in Greater Phoenix for less than $500,000 is currently finding relatively little choice and very strong competition from other buyers. This is particularly true for those buyers who need financing, who are often losing out to the large number of cash purchasers unless they are willing to bid significantly higher. Selling, however, is relatively easy, in a market where pricing is moving up and supply is very tight. 

There are currently 13,657 single family homes that are listed as Active in the MLS for the entire Valley with dwindling notices of foreclosures:

To put the current levels of foreclosure in context we need to compare January 2012 to January 2011:

• New Notices of Trustee Sale: 3,483 versus 6,784 - down 48.7%
• Trustee Sales: 2,677 versus 4,523 - down 40.8%

Despite a severe imbalance between supply and demand, reflected in the rise in the Cromford Market Index™, current pricing is fairly stable after recovering from the weakness of July through September 2011. However the recent sharp rise in the Cromford Market Index™ suggests a more significant upward price movement could possibly appear later in 2012 or in early 2013.

Bottom line is be aware of the declining inventory and prediction of rising prices!

Important Information - WILL SAVE YOU $$$$$

The Mortgage Debt Relief Act expires 12/31/12!!!

If you are interested in Short Selling your property, you must get it closed by 12/31/12 to receive the benefits of the Mortgage Debt Relief Act. The Mortgage Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief.

February 26th - Valuation Notices from the County Assessor!

If you receive your valuation and feel that the assessment is too high, you have 60 days from notice to appeal the assessed value.

Property Tax Class - Watch Out!

There are two classes of Property Tax: 1. Class 3 = Owner Occupied. Owner Occupied homes receive a $200-$600 education rebate. Class 4 = Non Owner Occupied and you DO NOT receive the education rebate. Forms will be sent to all homeowners and you are required to return the form IF you are Class 3 (Owner Occupied). That is, the state is assuming all homeowners are Class 4 and you must return the form so that you get the education rebate as a Class 3.

Meaningful Market Update: Information You Can Trust

For those of you that enjoy hearing more about the housing market, here is the year-end summary from ARMLS, Arizona Regiional Multiple Listing Service. It reflects what we have been seeing all year and puts us on a positive course for recovery! It's good to have good news ... finally!!

Sales rebounded in 2011 enthusiastically, topping out at 101,436, the second highest total sales of the decade.  It was surpassed only by 2005 with 104,725 sales, at the height of the real estate bubble. (We use late mid 2002 and 2003 to mid 2004 as our last normal markets before the big bubble.)

Foreclosures pending, which fuel the Valley’s foreclosure sales, reached their pinnacle in November 2009 at 50,568, and finished 2011 at 19,979, 60.49% below the decade high.  The average foreclosures pending per year stubbornly held at 44,237 and 44,698 for 2009 and 2010.  In 2011 it took an abrupt downward turn all year.

Distressed properties as a percent of sales started the year at 70.2%. Despite a series of hiccups in direction over the course of 2011, it crashed through the 60% barrier the last two months of the year, at 59.4% and 59.8% respectively.  Not only did the percent drop 10.4% over 2011, but the short sale to foreclosure mix shifted by year end, to see short sales overtake foreclosures for the first time.

Pricing cannot correct itself until the forces of supply and demand equalize. Both List and Sales pricing are currently unduly influenced by the large numbers of distressed properties that compete for buyers.  The slowing of foreclosures pending, if continued at the current rate, should stabilize in 2012, leading to a gradual decline to normal levels of foreclosures in the active property pool. Likewise, growing lender appetite for short sales over foreclosure will also diminish foreclosure influence on pricing. National predictions on home prices are a slow but steady upward climb in 2012.  Given 2011’s  underpinning metrics, the Valley's pricing is poised to gain traction in 2012.

All in all, it was a pretty good year for the Valley housing market and should only get better!

Sources: Arizona Regional Multiple Listing Service; Cromford Report

Meaningful Market Update: Information You Can Trust!

It was an unbelievable year in Real Estate!

Here are the final numbers for December 2011. These numbers are for all of Maricopa County.

As of January 5^th 2012;

Total active in Maricopa County are 15,333. That’s a very low number! Only 12% of the listings are REO at 1,809. And only 16% active are Short Sales at 2,406. Total number of normal listings is 11,119 which is 72%.

Total Pending in Maricopa County is 14,326. That’s a big number. 15% are REO at 2,187 and Short Sales make up 64% of Pending at 9,299 and Normal pending are 21% at 2,841.

Total Closed for Maricopa County in December was 7,014 which was 27% REO at 1,940 and 31% Short Sale at 2,236 which is our highest percentage to date!! Normal transactions were 40% at 2,841.

It looks to us like 2012 will be the year of price increases in all price ranges. We are encouraging our buyer clients to get into a home sooner than later if they want to pay less! Sellers, it's time to run some numbers and get you on the market!

Call us and we can tell you more!

 

Sources: Arizona Regional Multiple Listing Service; Cromford Report

Another Home Sold! Another Donation Made!

Our congratulations to the Gillem family for weathering all of the storms to finally close on their beautiful Scottsdale home! It came down to the last hour of the last day of the contract and took the entire team to pull it through! Our thanks to everyone involved for staying focused on the goal! We wish the Gillems a lifetime of happiness in their home!

Thank you to Beth & Don Schmal for the referral. A donation has been made to angel mamas in honor of the Gillem's new home.

Positive News in the AZ Real Estate Market - Check This Out!

Let’s end 2011 with good news in the housing market. According to our real estate bible, The Cromford Report, Phoenix is heading in the right direction. Our current home price level is 1.4% higher than it was 12 months ago. This used to be known as appreciation; today it is called “that can’t be right.” But it is!

DISTRESSED INVENTORY CONTINUES ITS SLIDE

Distressed inventory is the number of homes with an active notice of foreclosure along with any bank held property. These properties have been declining rapidly since last May. Simple math and logic show this to be true but others counter with complex math factoring together a Massive Backlog of Shadow Inventory, Robo-signings, and the ever popular Bank Conspiracies. It seems these folks want to keep the drama alive, perhaps hoping for a made-for-TV docudrama! Here are some facts:

Since January 1, 2007 Maricopa County has seen 165,385 home foreclosures, a numbing number in anybody’s book. One of the main reasons we believe we’re heading into the home stretch is how far we’ve come. The news articles talk about the same decline in distressed inventory previously mentioned, only they attribute the decline to massive processing delays. These same articles talk about how foreclosures rose through last summer and then began their decline in September when the robo-signings scandal broke. Information Market numbers tell a slightly different story of a short-lived Bank of America moratorium in November and December briefly lowering foreclosures. In January foreclosure numbers picked back up resuming their steady and consistent flow. In May, Maricopa County saw 4,206 homes sold at auction with 1 in 3 being purchased by investors, leaving only 2,800 reverting to the lender.  So, at the end of the day while our detractors have similar numbers, their explanation as to where we are and where we’re headed is completely different. Since January 1, 2007, Maricopa County has seen 165,385 homes removed from the “bad mortgage” file leading loan delinquencies to their inevitable decline.

Jay Brinkman, the chief economist of the Mortgage Bankers Association, states, "Of particular importance is that the drop in the percentage of loans 90 days or more past due was driven by improving numbers for loans originated between 2005 and 2007. These are the loans that drove the mortgage market collapse and now represent about 31% of loans outstanding, but 65% of the loans seriously delinquent. Given that loans originated during this period are now past the point where loans normally default, and that loans originated since then generally have better credit quality, mortgage performance should continue to improve.” 

So there you have it, folks. As soon as our local papers and news networks figure out that they can’t headline their reports with the negative foreclosure crisis drama, we may actually begin to hear positive news from the media. Until then, please call us for any information you would like for your neighborhood! The numbers don’t lie!

And Happy New Year to all!