Get Local

Have you ever come home to find to find a post card that says “We’ll buy your house.”?

It often looks a lot like this. More recently, the design has improved, making it look like a well-established real estate investment firm has identified your house specifically –rather than by computer algorithm.

They are funny, if it weren’t for the fact that they represent such a loss for home sellers.

They almost always include some text talking about how great your house is, even though the author has probably never seen your home.

They always promise to purchase your home for cash, quickly. Sometimes they tell you that this is a limited time offer because the buyer “has other possible investments.”

So, like any scam, it has the complement, the enticement and the deadline.

Don’t be fooled. More likely than not, the people sending this to you can buy many homes and you don’t need to respond by any deadline.

Similar to this deal are the companies that tell you they can help you sell your home “as a For Sale By Owner” (FSBO), thus saving you money on commissions. Don’t buy it!

But, more importantly, these ads are more likely to lose you money, and maybe more.

Here are some things to keep in mind:

1. Watch the ball! The promise is that you will make more money for your house when you “don’t have to give away 6% to realtors.” But, bear in mind that often times these investors offer you much less than you would “lose” by hiring a realtor.

2.  With a realtor you have somebody knowledgeable in the market who is contractually-obligated to protect your interests. Whereas these “investors” give you an offer and claim that it saves you the cost of paying an agent (6% usually), what they don’t tell you is that you probably could have brought in much more than that 6% or so by having an agent who knows the local market and knows how to do comparables.

3. Fees, fees, fees! Often there are fees that exceed what you would have paid a realtor. This is similar with the FSBO companies. I spoke to one person recently who was thinking of selling a home like this. He said that he was avoiding commissions and that he would not have to worry about doing any repairs. I asked him what fees they were charging and he replied “12%.”My jaw dropped and he explained that this was okay because he would not have to spend any money cleaning up the house or preparing for sale. I could see in his face change as I walked through the numbers for him. “On a $300,000 house, the difference between the 6% commission and the 12% fee is much, much more than you would ever need to hire a team of people to clean your house for you and make minor repairs. You could save thousands of dollars. What could you do with an extra $3,000 or $4,000?”

He is reconsidering that decision.

4. Realtors are licensed professionals for a reason. Its easy to think that realtors just list homes and drive around in expensive cars. But that’s not the reality (says the guy with the 2007 Prius with 170,000 miles on it). We are required to take 24 hours of continuing education every two years and we are liable for mistakes that we make. This is important when you consider things like disclosures. What happens if you don’t disclose something properly when you sell a house as a FSBO? You could find yourself in court, costing much more than you thought you would save.

If you have been tempted by the FSBO pitch or the “We buy houses” pitch, we are more than happy to analyze their offer for you. No cost. If I’m wrong and you could do better selling those ways, I’m happy to admit it. But if I’m right, please consider allow us to make a listing presentation to explain what do to sell your home.

Call us at 602-456-9388 for more.

Don’t sell that house without reading this little bit of advice for the month from our friends at Going Green House cleaning services.

I always feel embarrassed for the seller when I take clients in to see a house and they open the microwave only to see what looks the remains of a pitched battle between hot pockets and day-old apple pie.

But, its almost worse to have a lingering chemical smell, which often barely covers up the aforementioned battle scene.

So, from our friends at Going Green House, here a tip for a natural and efficient way to clean microwaves and refrigerators

You may think you need a heavy duty cleaner to get all that stuck on food to come off, all it takes is some natural ingredients you probably already have lying around the house: VINEGAR, LEMON JUICE, AND WATER!

Who knew?   Here’s how you do it.

1. Grab a microwaveable bowl and fill with a cup of water
2. Add about ½ cup vinegar and a couple tablespoons of lemon juice
3. Place the mixture in your microwave and heat for about 3-4 minutes
4. Once the cycle is through, let stand for 5 minutes inside the microwave
5. Take a towel and easily wipe clean!

Lemon is a natural cleaner and the vinegar and steam help to loosen any tough, stuck-on grime. No harsh chemicals needed.

If you happen to have some extra stubborn spots, just dip the towel into the mixture and wipe again, or use a toothbrush to get into those tricky corners. It’s as easy as that.

Now with all the extra time you saved, you can do the fridge.

Cleaning and deodorizing your fridge can be easy and chemical-free as well. All you need is…you guessed it–vinegar, lemon juice (or lemon essential oil) and water!

1. Take 2 cups hot water, 1 cup vinegar, and 10 drops of lemon and combine them into a spray bottle.
2. Use this mixture to spray down the inside of your fridge and wipe clean with a cloth.

No more worrying about carcinogenic chemicals in the same place you eat. Simple ingredients, but strong, NATURAL cleaning power.

If this tip has helped you get your house ready to sell, or if you have feedback, please let them know at info@goinggreenhouse.com.

And, as always, if you have questions about buying or selling home contact the Get Your PHX Team at 602-456-9388.

Thanks again to our friends at the Cromford Report, here’s the September Market Update, as the days shorten, the nights cool off and kids are ensconced securely back at their school desks.

Summary:
Listings Under Contract up 12%
Monthly Median Sales Price up 7.1%

For Buyers:
If you’ve been frustrated over the past 5 months with high buyer demand for well-priced properties within your price range, you should be seeing some relief now. August is typically a slow time for buyer activity across all price ranges and 2016 is no different. Contracts in escrow began their decline in June, dropping nearly 17% from a high of 13,432 in May to 11,190 by the first week of August.  Active listings have also declined nearly 10%, down to 19,783 since their peak in March at 21,924. At this time of year, many sellers are tired of being on the market, making it a good time to revisit those listings that were not picked up during the peak or came on the market late in the season. August is a very slow month for new listings to come on the market, therefore expect inventory to be relatively stale until more new listings start coming on stronger towards late September and October.

For Sellers:
Yes, the summer is slow in comparison to the busy Spring season. However, there is a bright side for sellers. While contracts in escrow have seasonally declined 17% since their peak last May, at 11,190 this measure is nearly 12% higher than last year’s count.  Another bright side for sellers is, despite the seasonal slowdown of new contracts in escrow, listings under $400,000 are still getting within 98-99% of their asking price after negotiations.  Nearly 28% of July closings through the MLS included some level of seller-assisted closing costs.  That percentage is highest for listings between $200,000 and $250,000 at nearly 35%, and lowest for listings over $500,000 at under 5%.  Be prepared for weekly price reductions to increase next month as more new listings begin to enter the market.

If you need help getting active in the market, give us a call at 602-456-9388.

Listings are moving quickly now. Its that kind of market. Can you believe it?

Our beautiful listing in the FQ Story Neighborhood went under contract in just four days.

Its a beautiful home, priced right for this strong seller’s market. We worked with the sellers long before they listed to identify the projects to complete in order to get ready for sale.

If you’d like to see more photos of this listing, please have a look here.

The owners did a lot of work to prepare for sale and the home shows beautifully. Local photographer Alonso Parra does a beautiful job with listings, even though he is known more for individual portraits. It does illustrate, however, how important it is to put your best foot forward.

This is a good time to sell, if you’ve been thinking of doing it. If you need help getting ready to list and price your home, give us a call at 602-456-9388.

The August Market Update shows a continued strong summer. Buyers are having a hard time below $200,000, unless you are looking at condos. Sellers are seeing a continued steady upward climb.

See below for greater details.

This trend is intensified in downtown, as we see more people wanting to live in dense areas.

This graphic is almost a month old, but it is still holding up. Our friends at the Cromford Report are doing a good job turning dry numbers in to digestible graphics.

For Buyers:
Unless you’re looking for a property in the lowest price ranges, there’s a decent amount of supply to choose from in the Phoenix Metropolitan Area.

As prices rise, most buyers will adjust what they buy in terms of size or location in accordance with their budget.  Over time, we’ve seen the average size home purchased continue to rise, even when prices were at their highest.

For example, in 2002 the average sized home purchased was 1,607sf.  It rose to 1,632sf in 2006, then 1,715 in 2011 and 1,762sf so far in 2016.  Of properties sold under $200K in 2006, the average size is currently 1,388sf.  Between $200K-$300K, the average size is 1,829sf.  $300K-$500K is 2,385sf.  $500K-$1M is 3,189sf.  $1M-$2M is 4,421sf and over $2M is 6,338sf.

For Sellers:
The median sales price has risen a whopping $20,000 since January’s measure of $210,000, a 9.5% increase.  This type of disparity can spur articles and discussion about real estate “bubbles” and rapid price appreciation.

This looks very exciting for sellers until it’s compared to the price per square foot measure, which has only increased 1.5% from $138.73 to $140.84 during the same time frame.  The difference in growth rates between the median sales price and the average sales price per square foot can be attributed to a shift in the composition of sales by price range.

Due to the lack of supply of properties below $150,000, the Phoenix Metropolitan Area has seen a significant drop in percentage of sales in this price range.  Simultaneously, there has been an increase in market share within the $200,000 – $300,000 price range where there is also more supply.  The increase in supply over $200,000 keeps individual property appreciation per square foot more sustainable.

However, because the under $150,000 market continues to lose market share as the over $200,000 market gains, the median sales price measure is pushed up higher than the rate of the average price per square foot.  For the median measure to increase, sales over $230,000 would need to achieve 51% market share or more.

Those of you who know me know that I’m very in to sustainability and protecting our environment. So, I figured its about time that I team up with a locally-owned business to bring you some tips about green cleaning to sell.

My friends at GoinGreenHouse.com are practicing what they preach in house cleaning and I’ve been impressed with their efforts. And they’ve got some good tips for you.

So, here is the first of many articles that we’ve collaborated on. This issue: green cleaning to sell your home. Enjoy.

———

Not many people know this, but you can lose a sale in the first 30 seconds that a buyer is in your home.

You’ve often heard that cleaning and de-cluttering any room appear more spacious and attractive to the buyer, allowing them to visualize how their own items would fit.

But cleaning works more at the subconscious level, which can be much more dangerous for your sale.

If these folks can’t keep the countertops clutter free for showing, what kind of clutter do they allow in the pipes?

If you don’t clean and de-clutter, you are signaling to the buyer a red flag that there may be other things that you are also not maintaining, like the air conditioner or the plumbing.

However, the easiest, cheapest and most-recommended DIY improvement for sellers is to CLEAN AND DE-CLUTTER. It’s easy to begin by removing clutter and personal items.

To get the most bang for your buck, you need to focus on the FOUR rooms that buyers are most interested in:

• Living Room
  • Store remotes, magazines, blankets, and other personal items
• Dining room
  • Streamline décor
• Kitchen
  • Keep out ONLY appliances that are used every few days, make sure to wipe them clean
  • Maintain a spotless stovetop and clean, dish-less sink
• Bathroom
  • Scrub grout free of mold and mildew
  • After each shower, towel dry or use a squeegee to prevent water spots on glass
  • Clear off countertops of non-essentials and store them in containers

In order to give the overall impression of a well-maintained home:

• Dust and wipe all surfaces, making sure not to forget baseboards, windowsills, and fans
• Wipe away dirty fingerprints from light switches, doors, handles, cabinet and drawer fronts
• Mop floors and vacuum carpets regularly
• Polish wood floors to a shine and be sure to clean grout on tile floors

But, don’t stop there. If you are going to go through all of this effort, I suggest that you green clean using environmental friendly and heavy chemical-free cleaners.  I’ve been in homes many times, especially renovations, where the chemical smell is overwhelming.

Buyers are increasingly aware of the negative health impacts of VOCs (volatile organic chemicals) and, just as in the case of an unclean house, it sends a subconscious signal that this space may be unsafe.

If all of these things are maintained on a daily basis, you’ll be ready for any buyers that come your way! So, if you are thinking to sell in a few months, or if you just need help, contact April at GoingGreenHouse.com and she will hook you up.

Then, once every couple weeks while the house is on the market, they can help you keep on top of the cleaning chores. This will make it easy to have the house ready for that final walk-through before closing!

And, as usual, if you need help building a successful strategy to sell your home, please contact us at 602-456-9388.

Prices have been going up for houses in Phoenix over the last few years. Not drastically, though. Its not 2007 all over again. But prices have been climbing in a healthy manner for a while.

So, you say to yourself, “Self, I don’t think I can purchase a home right now. Those prices are too high!”

But the price is not the whole story. Consider the interest rate!

Here’s what I mean.

In December 2013, according to Freddie Mac, average interest rates were about 4.46%. Had you bought a house in CenPho then, you would have paid about $140/square foot.

Let’s say you purchase a 2,000sf home then. The cost would have been $280,000. At 4.46% interest, your Principle + Interest (P&I) would be $1,412.07. (This does not count fees, taxes and insurance. We are not mortgage brokers, so check with them for those details.)

Okay, so fast forward to today. Average prices are $180/sf in Cenpho. That same 2,000sf home will cost $360,000. At 3.57% interest, that’s $1,630.66, P&I.

To which you say, “Hey, that’s definitely more expensive.”

Yes, but had that loan been at 4.46% interest, the house would have cost $1,815.52, P&I.

Another way to look at it is that you could have purchased a $320,000 home for roughly the same monthly cost with rates at 3.57% as a $280,000 home when rates were at 4.46%.

Does that mean you can afford that house? Maybe. Maybe not. But you are definitely saving $200 per month over where it was when homes were selling for $140/sf.

Interest rates are lower right now and they will not always stay low. On the other hand, there is not much room for new homes in CenPho, other than condos and townhouses, which are not being built in great enough numbers. So, those prices are likely to go up further before they go down. Your chances of getting a home while the interest rates are lower and the prices are lower may be slipping away.

We can help you think through your options. Buy now? Rent for a while longer? Purchase in a different area?

We can help you buy or sell your home. Please give us a call at 602-456-9388.

Here’s your July Market Update.

As usual, our friends at the Cromford Report give us the broad outlines for the entire state. Highlights:

“The market conditions improved a little for sellers during June, with the Cromford® Market Index breaking through the 140 level as we enter July. However there is no dramatic new trend, just a continuation of what we have been seeing for several months now. Sales volume was strong during June but it is clear that July will be much quieter for closings since the number of homes under contract has fallen quite a bit. This is quite normal for the season.

…

The ranges from $200,000 to $350,000 saw strong growth in closed sales over June last year – up almost 19%. Between $350,000 and $400,000 we saw a little weakness, down 2%, but sales from $400,000 all the way up to $1.5 million were strong – up an impressive 21%. Sales over $1.5 million were very much weaker than last year – down 44%. Sales below $175,000 were also well down, but this was caused by a lack of supply. The segment over $1.5 million cannot use that excuse. There are plenty of homes available, even though a large number have been removed from the market for the summer. Many of these are likely to be relisted at the end of September.

…

We expect overall prices to be flat to slightly lower over the next 3 months as luxury homes make a smaller contribution when the temperatures exceed 100 degrees. Prices are still rising below $200,000 and falling for most homes over $1 million.”

When we look at some of the indicators for Central Phoenix for the July Market Update we continue to see a strong market, as folks really want to live in central.

The chart, above, shows that the price per square foot for detached residential as well as for condos is steadily climbing. No upward bursts that would indicate a bubble.

The chart here shows the contract ratio. That is the ratio of homes on the market that actually close. We are in a hot market when we are over 60%. So, we are right in line with last year, this time.

Anecdotally, we are seeing a lot of renovations. At first we could not figure out how these renovators were making money with the market so high. How can they purchase a property, renovate it and still make a profit.

Then I realized that they are getting low-priced homes from people who respond to those offers they get in the mail to purchase their homes. You know, the ones that say “I love your house and I’ll pay you cash to leave it.” That kind of deal.

But for the numbers to work out, the renovators must be getting these homes pretty cheap, by comparison to what the market will bear.

That tells me that they did not have representation from a realtor. Because they certainly would not have let their homes go for this cheap.

If you get a letter in the mail claiming that somebody wants to buy your house today for cash, please call us at 602-456-9388 and we will help you negotiate a better deal. 

For the monthly period ending May 15, our friends at the Cromford Report were recording a sales $/SF of $142.50 averaged for all areas and types across the ARMLS database. This is up 1.8% from the $139.96 we now measure for April 15.

In most years, prices make a lot of progress between March and June so they think 2 months of strong advance from April 15 to June 15 is a very reasonable expectation.

They also expect a retreat to occur between June 15 and September 15, because this is a seasonal pattern that occurs almost every year.

So, what does that “retreat” actually mean to you? Does it mean that prices will fall? I don’t think so. When we look at the Cromford Index (a measure of who has the advantage, and by how much), you can see that sellers have about the same advantage as they had last year. (Anything over 100 is a sellers’ advantage.)

When you look at price per square foot over the last three months in the CenPho area and historic neighborhoods, you see a strong climb for all prices. But, when you break it down, you see more strength in the sub-$200k market than the $200k to $500k market.

Why? Well, probably because there are so many first time home buyers who need homes and they are just not coming on the market. I think there is also a bit of a leveling in the $200-$500k band because many of the renovators and sellers are pricing their homes too high and the buyers just are not buying it.

See below for those charts.

So, what does this mean? I think we are in for a continued strong market through the summer with prices in the lower ranges pushing upward. Michelle and I usually find that the summer still has a very strong market. Well, we are busy, at least!

If you would like to build a strategy to purchase a home or sell your home, contact us at 602-456-9388.

$200-$500k market

All prices

Sub-$200k market.

Our friends at the Cromford Report supply us with great data for our May Market Update, which we use to help our clients. Here’s a summary of the data as of the middle of April, in time for this month’s Clark Report.

For the monthly period ending April 15, we are currently recording a sales $/SF of $140.06 averaged for all areas and types across the ARMLS database. This is virtually unchanged (up just 7c) from the $139.99 we now measure for March 15.

Sales pricing over the last 31 days has been considerably weaker than expected but stayed within the lower bound of our 90% confidence range.

In most years, prices make strong progress between March and June so we felt confident that last month’s forecast was reasonable. Only adding 7c to the average price per sq. ft. between March 15 and April 15 is pretty underwhelming. We are forecasting a more impressive advance for May 15, but we could again be confounded by a negative change in the sales mix.

Normally prices decline between June and September each year, so sellers will be hoping for a stronger pricing trend during the next 2 months than we saw during the last 2 months.

This is reflected in the CenPho and historic markets, although the data seems to contradict itself. In short, while the sales prices seem to be going up, the average days on market are increasing and the active listing count seems to be going up.

What does this tell us?