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Source: MSNBC

Here is more on deportation from the Phoenix market. In a previous post, I touched on how plans to deport millions of undocumented residents could impact the real estate market in Phoenix.

I told you that we are not likely to see any mass movement any time soon.

But there is one shift that could happen if there is deportation from the Phoenix market, and it has to do with jobs and interest rates, nationally. You’ll want to keep an eye on this.

First, know that the unemployment rate just hit the lowest in 9 years on December 2nd, 2016. That is good, over-all. It does not mean that everybody is fully-employed or that they improving wages. But, it is better than it has been.

But it means that the Federal Reserve Bank is watching out to make certain that the economy is not about to overheat. What happens with full employment? When there is full-employment, employees begin to demand higher wages and that puts up-ward pressure on inflation. So, the Fed raises interest rates to slow that growth, reduce wages and inflation.

So, as reported on the Marketplace Morning Report today, if a Trump presidency is able to deport millions of workers just at a time when the economy needs them, unemployment will reduce further, and the Fed will be pushed to increase interest rates even further to slow inflation.

That could affect the housing market, too.

I know, all of this is highly speculative. But my point is that you will want to watch what happens in this sector to see what could happen in the housing market in late 2017.

In good news, Phoenix is expected to be the top market in the country in 2017. I take this with a grain of salt, as you might guess.

“We don’t expect the outcome of the election to have a direct impact on the health of the housing market or economy as we close out 2016. However, the 40 basis points increase in rates in the days following the election has caused us to increase our interest rate prediction for next year,”   –Jonathan Smoke, chief economist for Realtor.com in Phoenix Biz Journal, Nov 30, 2016

We will be keeping an eye on the market and the political landscape. If you have questions about how this might affect you, give us a call at 602-456-9388.

The December 2016 Market Update is based on the latest numbers from November. Our friends at the Cromford Report provide us with the most reliable data to share with you.

“After the usual summer lull, pricing has regained a lot of upward momentum over the last 2 months. However that upward momentum is petering out now and increases in the rest of the year are likely to be modest. Nevertheless it still seems probable that will see the highest average price per square foot for 2016 posted during December.

For the monthly period ending November 15, we are currently recording a sales $/SF of $145.44 averaged for all areas and types across the ARMLS database. This is up 1.8% from the $142.84 we now measure for October 15.

On November 15 the pending listings for all areas & types shows an average list $/SF of $147.84, up 0.2% from the reading for October 15.

Our mid-point forecast in the December Market Update for the average monthly sales $/SF on November 15 is $145.81, which is 0.2% above the November 15 reading.

Currently we are seeing additional supply arriving for the West Valley, especially Surprise, while supply in parts of the Southeast Valley is becoming tighter, especially in Chandler. On its own this change is likely to cool average pricing a little because the future sales mix will slightly favor the cheaper homes in the West Valley which sell extremely quickly.”

What does this mean for you? Well, I think prices will continue to rise, generally, and specifically in the CenPho and historic neighborhoods. There are few new houses being built in this area and people still want to live more centrally.

While there is increased pressure on the Federal Reserve Bank to raise interest rates, especially with news that we just hit the lowest unemployment rate in 9 years on December 2nd, even a one-point increase in interest rates probably won’t slow that demand. We are already at historically-low levels. So, we would be at “historically low + 1%.”

So, if you are looking to sell, I would do that between January and June, before any possible negative outcomes from an aggressive Trump immigration policy might take hold. Plus, that is the busiest time of the year. Please see my post on that issue, here.

If you are looking purchase, I would do that sooner, rather than later. If prices are going up and interest rates are going up, you could get hit with a double-whammy.

Give us a call and we can help you build the best strategy, 602-456-9388.

So, were you waiting for the election to purchase a home?

Well, the election is over and people are asking me whether its safe to purchase a home, or whether we should expect market turmoil under our new president.

They’ve seen stories like this one from the Arizona Republic, which speaks to scarcity in the housing market and makes a tenuous tie to the presidential election.

Here’s another article from Slate indicating that people have been putting off major buying decisions due to the election. While I’m sure some people have held off on major decisions, we have not seen that among our clients. We’ve been busy!

Even so, if folks have been waiting for the election to decide until now, we will know it in about a month. If monthly sales numbers bounce, then you will know that people are re-entering the market. I’ll look back in about a month and let you know what we see. If you are inclined to believe that people have been waiting to act, then you will want to act before that bounce happens.

More than anything, let me put these fears to rest: the real estate market is not likely to undergo some serious upheaval any time soon.

First, here’s some advice that I found to be accurate in this article, which really points to how short-term fears about a presidential election might benefit a few, but are not a good reason to act quickly for most. Here’s the key take-away quote:

“I don’t think it’s a wise idea to try to time any markets, especially housing,” says real estate expert Kurt Westfield at WCE Equity Group. “Housing markets are very localized, subject to microeconomic shifts. The election takes place on a much larger macroeconomic scale.”

Second, let’s talk about the nature of the real estate market and why you should not act in haste. Nor should you hold off if you need to buy or sell. In other words, just act on your housing needs as they are today.

The most important thing to keep in mind is that the markets move very slowly. I know. It did not feel that way in 2008 when people’s homes seemed to lose value in months. But, when you look at that data, it still took months, not days or weeks for major movements to take place.

Sure, you will see small changes around the end-of-year holidays when people are focussed family and parties, but that’s an annual deal and does not change the market too much.

The thing you should most be aware of in the short term (3-6 months) is interest rates. While they are still historically low and probably won’t jump too quickly, a one percent increase represents a lot of money over the life of a loan. We know that the Federal Reserve Bank is talking about interest rate increases, so we encourage you to speak with your lender about what he or she is seeing.

In other words, don’t hit the panic button on interest rates. Just keep an eye on it. Make your decision based on what you need when you need it.

Let’s turn for a second to the long-term view (18 months to 2 years) just so I can make one point about Donald Trump’s threats to deport 11 million people. If his threats are carried out in whole or in part, then you will definitely see a major hit to our real estate market, according to Tina Tamboer of the Cromford Report.

I want to be careful here and temper that previous comment. That is IF he can forcibly deport people or IF they choose to leave on their own. And even then, the affects would be seen 3-6 months after he takes action.

According to Tina, we would see a dramatic increase in supply of homes (as people move away) at the same time we would see a huge reduction in demand (as immigrants would no longer purchase homes). Yes, immigrants own homes.

But this would also impact those folks who own rental properties. Many of whom voted for our next president. Further, according to Tina, the impact would not be localized to certain neighborhoods. The impact would be valley-wide.

In the even longer term, according to Tina, Arizona’s population is aging quickly and we don’t have younger people to replace the aging population who can afford to purchase homes.  Otherwise in the next 15-20 years we will have a huge excess of homes and prices will depress significantly.

This means that we need to find some solution to the immigration issue, which allows immigration in to Arizona.

You know, the very thing that the next president ran against.

We can help you make the right decision on your sale or purchase. Contact us at 602-456-9388.

We check in again with our friends at the Cromford Report for another market update.

Each month about this time they look back at the previous month, analyze how pricing has behaved and report on how well their forecasting techniques performed. They also give a forecast for how pricing will move over the next 30 days.

Important take-aways…

“For the monthly period ending October 15, we are currently recording a sales $/SF of $142.45 averaged for all areas and types across the ARMLS database. This is up 2.2% from the $139.37 we now measure for September 15.”

“After the usual summer lull, pricing has regained upward momentum and it seems probable that will see the highest average price per square foot for 2016 posted during December.”

Anecdotally, Michelle and I are seeing a lot of activity. If you list it, price it well and prepare it to show nicely, it will sell quickly.

We are seeing listings that go under contract stay under contract. So, cancelled listings are pretty rare, at least in the CenPho and historic areas.

We are still concerned that the market is over-building apartments and ignoring the needs of moderate-income folks who want to live centrally. In other words, we need more owner-occupied. We don’t say this because we want to sell them all. But we know that neighborhoods need a good diversity, even if more folks are choosing not to purchase.

Interest rates continue to stay low, and people are taking advantage of it.

The historic areas have seen a steady upward climb in prices. People are getting solid financing, so we don’t expect the troubles of 2008. There will always be market corrections, but we feel confident that CenPho and Downtown will stay strong because there is a country-wide trend toward living in urban cores.

If you are thinking of selling or buying, please contact us at 602-456-9388. We will help you get the information you need for the right decision the first time.

Just in the last 4-5 weeks we found ourselves swamped: listings, buyers, lots of activity.

Something about the impending cooler weather gets people’s juices flowing.

That activity is born out in what the Big Brains™ at the Cromford Report are seeing in their tea leaves.

“For the monthly period ending September 15, we are currently recording a sales $/SF of $139.28 averaged for all areas and types across the ARMLS database. This is up 1.1% from the $137.83 we now measure for August 15.”

6-month moving averages for price per square foot for the areas of CenPho which contain most of the historic and downtown neighborhoods. No wild swings here.

It is interesting to note that, despite the strong seller’s market, the active list prices are still a little bit above the final sold price. “On September 15 the pending listings for all areas & types shows an average list $/SF of $146.50, up 0.6% from the reading for August 15.”

That means that properties sold for about 6% less (in PPSF) than what they were listed for. That’s expected as people negotiate prices. Further, these numbers are from all areas. So, you may not see that drop off everywhere.

That’s good news for buyers. Even in this strong market, it does not hurt (unless you know there are other offers coming in) for you to try to slice a little off that price.

Its also interesting to see that the distressed sector of the market is back to pre-recession levels. “Among those pending listings we have 92.4% normal, 2.8% in REOs and 4.8% in short sales and pre-foreclosures.”

In other words, no, there really are not many distressed properties out there anymore –he says for the benefit of those who call him every few weeks asking if they can find a foreclosure to purchase for half the going market rate for homes.

Same historic and CenPho zip codes, 3-month moving average.

The Crazy Cromford Calc Crew™ is predicting slightly higher prices still in October. “Our mid-point forecast for the average monthly sales $/SF on October 15 is $140.36, which is 0.8% above the September 15 reading. We have a 90% confidence that it will fall within ± 2% of this mid point, i.e. in the range $138.27 to $143.91.”

Again, this is county-wide. It could be higher or lower, depending on the area.

The nice thing is, dear reader, that your Get Your PHX Team really knows the neighborhoods. So, we can help you take advantage of these trends, regardless of whether you are buying or selling.

Contact us for more at 602-456-9388.

Don’t you hate it when people start talking about the holidays in October?

Well, hate away, because here we go (with our apologies).

Our friends at Going Green House have some tips for you, which I think you can also apply to preparing to list your home.

Fall is finally here and the holidays are approaching fast. Before you know it you’ll be scrambling to get every thing in order before your houseguests arrive.

To take some of the stress off this holiday madness, it’s beneficial to be proactive about cleaning your home.

You know. Plan ahead. The thing we all find difficult to do in our hectic lives. But you can break up the task with a pre-holiday deep clean—hitting all those areas that you don’t typically get to during your regular maintenance cleanings.

That way, you won’t have to worry that your mother-in-law is judging you for those cobwebs growing in the corner.

To help get you started, here is a list of deep cleaning items to add to your pre-holiday prepping:

Kitchen

• Wipe down all kitchen cabinets and drawers free of dust, fingerprints, food and drink splatter
• Clean inside the oven and make sure to clean the range top, face, and hood
• Clean inside microwave
• Wipe off any dirty knobs, light switches, outlets, and windowsills
• Dust or wipe clean light fixtures and blinds
• Use a vacuum extension or duster to get rid of any cobwebs near the ceiling

Bathroom

• Wipe down fronts of all cabinets and drawers and any shelving with damp rag
• Dust or wipe clean light fixtures and blinds
• Wipe all baseboards, door frames, and light switches
• Wipe all bathroom fixtures, including towel and toilet paper holders
• Don’t forget the base of your toilet!

Main Living Areas

• Dust or wipe clean all blinds and windowsills
• Use a Swiffer duster or damp rag to wipe all fan blades and light fixtures
• Wipe clean all baseboards, doors, and door frames
• Clean any dirty or dusty light switches and outlets
• Use a vacuum extension or Swiffer duster to get rid of cobwebs hiding in the corners
• Clean all sliding glass or entryway doors, making sure to wipe the threshold
• When dusting furniture, use a damp rag in order to collect more dust and prevent settling
• Vacuum all couches and upholstered furniture free of pet hair, dust, and crumbs

April Prothero of Going Green House

This may seem overwhelming to add to your regular cleaning routine at first, but if you get started now, you’ll be a lot less stressed about having a sparkling house when the holiday craziness reaches its peak, or when you are about to list your home.

And of course, if you already have a lot on your plate, April Prothero and the Going Greenhouse crew would be happy to help alleviate the stress. Call her at (602) 476-9321.

If this tip is helpful, or if you need more advice on getting ready to list your home, contact the Get Your PHX Team at 602-456-9388.

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.