Here are some graphs that tell me so much about where the market is right now, and where we can expect it to be for the next year. Thanks to my friends at the Cromford Report for this illuminating analysis. Click on each chart for a larger view.

1) Annual Sales Rates — This chart tells the story of where this market has come from and where it is now. Notice that the number of sales per year peaked just before the Great Recession, crashed during the recession and climbed back over 2011 to late 2013. Most interesting, look at where it is now. We hit this point and now we are at a plateau. Is that bad? Nope. See the next chart.

2) Cromford Index Over the Long Term — This tells you where we are: equilibrium. If you look back at older posts, you will see that I talk a lot about the Cromford Index. This tells you not only whether we are in a buyer’s market or a seller’s market, but by how much.  If we are over 100, it is a seller’s market. If we are under 100, it is a buyer’s market. Notice that we are hovering just under 100, but just within reach. Notice also that it seems to be staying there, at just about the same time in history that is shown as that plateau in the chart above. So, what this means is that buyers and sellers have roughly the same amount of leverage. This means that we homes are selling, but not there is neither a rush to cash out nor a rush to hold. That’s a healthy market.

3) Price vs. Payment — So, why is this? Well, despite the lowering real income over time of the American family, the super-low interest rates are helping drive the real estate market. When you look at this chart, you can see that your monthly payment will get you much more house than it would back in 2008. So, affordability is much better right now. This, friends is the actual impact of low interest rates –in action. Yep. Its like an action movie.

4) Long-term Price Per Square Foot. — So, where are we going? As I’ve been telling clients, we are in a slow, healthy upward climb in home prices. If you look at this chart, you will see the 2% to 3% range of long-term growth in prices, shown in the grey shaded area. Notice that, after the recovery of 2011 to 2013, prices are skirting the lower range of that shaded area. So, no bubbles and no drops.

 What does this mean? It means that if you are buying, prices are sliding slowing upward, but your buying power is strong. If you are thinking about selling, you might as well do it now while buyers have more purchasing power. If you wait a year, the most you will gain on your sale (unless you do major renovations) will probably be about 2%. In other words, sell based on need, not on a desire to play the market.

As usual, I can help you make the right decision. Give me a call at 602-456-9388.

 I got a peek recently at a list of multi-family projects that are in “pre-development” or current development stages in downtown Phoenix.

It was an interesting thing to see that the list accounted for about 2,000 rental units that should be completed in downtown by the end of 2016, but only about 360 owner-occupied units, to be completed in the same time period.

There is a rough proportion of rentals to owner-occupied units that one would expect in any area, but I was surprised to see the proportion at about 6 rental units for every 1 owner-occupied unit.

There ares several dynamics here.

First, the city of Phoenix is very eager to get “rooftops” built downtown as an economic development tool. They seem to want to provide housing for rent in order to provide for the growing student population, more than they are driven by owner-occupied units.

Second, “millennials” seem to be less inclined to purchase home. After all, they saw their parents and family lose homes during the Great Recession. Who need that, right? Further, with an average of $24,000 of debt coming out of Arizona undergraduate institutions alone, these folks don’t have the borrowing capacity.

Third, we still have some properties (I’m looking at you 44 Monroe) that were once owner-occupied, but which are now rentals. Maybe they will come back to owner-occupied in the future.

I get all of this, but there is a part of me that is concerned. You don’t have to buy in to the “great American real estate” dream that your home is an investment to know that you need a good mix of owner-occupied in any community. Owning a home means that the occupants are more likely to feel a connection to the neighborhood, to get involved in block watch and neighborhood associations.

Don’t get me wrong. I don’t think that renters are too transient to care about their neighborhoods, as some do.

But, color me a little skeptical that it is a good idea over the long term to have six times as many rental units as there will be owner-occupied units downtown.

That is all. Talk among yourselves. I’d be interested to hear your thoughts.

So, I’m not usually one to use my own blog to complain about customer service.

But, here’s an issue that I can’t find any other way to get an answer to.

Let me explain.

A few years ago, I purchased a copy of Quicken, which allows me to sync with my bank so that I can keep track of my accounts.

Sounds like a standard feature and one that I expected to be part of the software that I purchased, in perpetuity.

So, I was shocked to get this email a few weeks ago. The long and short: “You must pay to upgrade to the latest Quicken or we will shut off that feature that allows you to sync with your bank.”

I can keep the software and do other things, but I can’t do that really, really important thing that I bought the software to do.

Isn’t this coercion? Isn’t this like holding my software hostage until I purchase their expensive upgrade.

Will somebody who knows more than I do about this please let me know if I’m totally off my rocker here?

—————–Update——-

Here is Quicken’s response: https://qlc.intuit.com/questions/160620

 In brief: they maintain servers which allow users to access their banks.

My response: I still think this sets up a system of holding software ransom. Even if I did not believe that, I think Quicken did a terrible job explaining the “why” behind this decision, let alone being available when I tried to reach them via the website for an explanation. I should not have to go to Twitter and my blog to get an answer.