The home buying process seems complicated and confusing if you’ve never done it.

The first time I thought of buying a home, I procrastinated because –and get this– I didn’t trust realtors.

Now I am one. Go figure.

What we’ve found over the last couple decades in real estate is that it’s really important to preview the process before we get started.

Seems elementary. But we’ve talked to people whose agents might as well have thrown them out of an airplane with parts of a parachute and an Ikea assembly manual.

We do better.

Really. Not to sound superior, but we do.

When we first meet a new client (particularly new home buyers), we go through a little Powerpoint presentation on what to expect.

It puts their minds at ease and makes the process smoother.

We also encourage buyers to look over this buyer advisory or this list of tips.

This post is the beginning of an in-depth series of posts that give you a deep dive perspective of the process.

Sure, I could just publish a list of steps in the home buying process. But then I deprive myself a chance to practice my writing skills.

Okay, to start this series off, let’s put things in to context and explain your rights as a client.

Part 1: Fiduciary Responsibility

That is not just a pretty phrase. It means that we must put our interests above the client’s and we can be fined heavily, be sued or lose our licenses if we do not.

This is not nothing. When I bought my first house I had no idea that realtors could be held to such high levels of responsibility for what they do. No wonder I didn’t trust them.

We take on a lot of responsibility when we agree to represent your interests.

Here are the things that define fiduciary responsibility, in understandable language:

Confidentiality – Safeguard your secrets unless doing so would violate disclosure requirements. In short, we can’t tell the seller that you are willing to pay more than you offered.

However, if you are the seller and you ask us to hide the fact that there is a secret hive of little green aliens in the basement, we cannot. That’s material to the sale. Plus, I think hiding aliens from Mars is illegal. I’ll get back to you on that one.

Accounting – Account for all funds entrusted to us by you. To be fair, we don’t handle money much anymore. It used to be that the buyer would give an earnest money check to the realtor to hold during the transaction. I’m so glad it’s not like that anymore! Now, f you are a buyer and you deposit earnest money, it goes to the title company.

Reasonable Skill and Care – We must work within our knowledge and capacity. In other words, we can’t pretend that we know how to sell the Westward Ho or an empty shopping mall if we don’t have experience at that.

Loyalty – Act in your best interest. We have to help you meet your goals in a way that is not harmful to you. We can’t, for instance, help the other side of the transaction if we think it could help us personally. Seems simple, right? We must put your interests first. But, I guess we had to spell this one out, huh? There are some bad agents out there, and we’ve met a few of them.

Obedience – This means we need to follow the client’s lawful instructions. We can’t break the law. But, if you tell us you want to list your house 20% above market level, we have two choices: do it, or end our listing agreement.

Accountability — You can count on us to communicate to you in a timely manner and be respectful of your time. You’d think this one is easy, but really…

Disclosure – Disclose all material facts to you. If we find out, for instance, that there are cracks in the foundation of a home, we must tell you. It is material to the sale of the home. We are not inspectors. But if we see a “red flag”, we gotta tell you.

There are some things we are not required to tell you (especially if we don’t know), such as whether the home was the site of a felony, if somebody died in the home, or if the home is in the vicinity of a sex offender. We can’t tell you if somebody lived in the home who had HIV or AIDS. That is Arizona law. Otherwise, if it could affect your decision to purchase the home, we need to let you know about it if we know.

That’s it. Agents don’t just sell homes and buy big cars. There are actual repercussions if we don’t respect our fiduciary responsibilities.

You might notice, by the way, that those words spell C-A-R-L-O-A-D.

Gee, those realtors are clever.

Next installment: Buyer disclosures and buyer/broker agreements.

Who owns rentals may play a really big role in affordability for families across the country –and maybe even homelessness.

This article, while a little strident in it’s tone, points to a problem that I outlined in a previous post about the number of evictions we are seeing in America today.

Listen to this podcast from On the Media, which aired last year. It gives a very compelling picture of a rental market that is now dominated by large investment companies or even property management companies that are employed by individual property owners.

This automation of the rental process leads to less leniency for renters when they are late on their rent.

This is a problem in a country where lower income workers are having a harder time paying for everything from rent to medical bills on less livable wages.

That lack of leniency leads to situations where renters are tagged with what the On the Media reporter Brook Gladstone called the Scarlett E. That’s “E” for for “eviction”.

That tag follows the renter so that they are relegated to less and less desirable properties, thus destabilizing their lives even further.

The most compelling point in this ownership dynamic is the increase in the number of properties owned by individuals and families from 92% in 1991 to 74% in 2015.

With the rise of mega-buyers like Zillow and other investor groups, this number could be even lower.

I’ve spoken about the problem of these mega buyers. They take homes out of circulation so that they are not available for other buyers, thus creating scarcity and elevating the over-all price of homes. Thus making home ownership even harder.

As we see an increase in homelessness, we need to be aware of those living on the margins. They are the first ones (families and children) who drop from barely making it to living on the street.

The February Market Update is starting to get a little redundant, you know? It looks much like the January update.

We still have a shortage of inventory. Builders are still spending their time on multi-family (mostly rental), with over 11,000 units permitted in the last year. That is an all-time high.

We need builders building single family or condos, especially in CenPho.

“Well, Ken, you are a realtor, so of course you want people to buy properties.”

Yeah, but no. That’s not true. There should be a healthy mix. This is not healthy. When you focus too much on rental construction you do three things.

First, you deprive neighborhoods of people who feel long-term connection to their community. This means fewer people doing block watch, fewer people communicating with their city officials about neighborhood health.

Second, when those people decide they don’t want to rent anymore, there are fewer homes on the market for them to purchase. Thus pushing up prices.

Third, once the prices are higher, it deprives people of the opportunity of home ownership. Their savings goes to landlords, rather than to themselves.

Sorry for going all “broken record” on ya.

So, where does this shortage leave us as we go in to 2020? Well, absent some catastrophic market failure, the market should be strong for the rest of the year.

There are no zero-interest loans out there. But there are a ton of AirBnB homes and corporate-owned single family homes that are being used as rentals.

According to Tina Tamboer of the Cromford Report, if the over-all economy drops and people don’t stay in AirBnBs as much, many of those will be put on the market.

We have no idea how many and whether that is enough to force prices lower.

Regardless, due to the scarcity of new construction in CenPho and the saturation of apartments, home prices may stay high even if the economy slows.

So, if you are thinking of buying, don’t expect prices to drop any time soon.

If you are thinking of selling, consider doing it before the summer comes on. The prices won’t necessarily drop, but there will be fewer people to compete for your home.

Call us at 602-456-9388.

Donna Reiner, a local historian and a good friend of Get Your PHX, has written many articles over the years for the Arizona Republic and others about Phoenix history. We use her services when we list properties of historic significance to help us tell the stories behind the homes.

We are happy that Donna is allowing us to re-publish some of her articles on a monthly basis. If you or your business ever needs a historian, let Donna know at laydeescholar “at” hotmail.com.

We generally think of libraries as being in permanent buildings whether they be large, small, or tucked away in someone’s home. But fixed sites have never adequately served those who find it difficult to travel due to distance, disability, or lack of reliable transportation.

Over time, the creativity of librarians and libraries found solutions. If the reader could not come to the library, why not take the books to them? Those moveable libraries came by horse, cart, bicycle, and ultimately a full fledged bookmobile which was often a large bus filled with shelves and shelves of books.

Phoenix started using bookmobiles in the late 1940s to serve outlying readers of the rapidly growing city. Initially the head librarian started with two “retired” city buses and the Arizona Republic always posted where the buses would be.

If you are old enough, you may remember the bookmobile. It would be conveniently stationed at set places on a specific day of the week and with set hours. Young readers and old anxiously awaited that day and hour.

One enthusiast commented, “Before we had a library in our area, the bookmobile would come to Maryvale Mall every Saturday!!! Each week my friends and I would go to check out books.” Michael Ging recalled riding his bike to West Plaza at 35th Avenue and Bethany Home Road to get books in the summer from the bookmobile. Early versions of the bookmobile were probably not airconditioned, but by the 1980s they were. A welcome relief for youngsters coming in out of the heat during the summer.

Today there are 16 branches of the Phoenix Public Library plus Burton Barr Central Library. Not much need for a bookmobile.

Ten years ago, the Little Free Library movement began. And with that program, one can find various sized “stands” offering books (no check out or overdue fines). Some neighborhoods, like Coronado Historic District, sponsored such libraries for the benefit of anyone who happens to want a book. It’s all in the name of promoting literacy.

Bibliophile, book worm, lover of reading, bookish. Finding the best and/or appropriate word to describe one’s passion for reading is not that easy. All I can say is that I don’t leave home without one!

In December I wrote about how I calculated my carbon footprint again for the first time in years.

The end result was that I sent $315 to the Arbor Day Foundation in the hopes that they could put that right in to the purchase of trees.

The thinking was that, rather than buying renewable energy credits, I would invest in trees, which collect many tons of carbon over their lifetimes. It does not reduce my current carbon footprint, but it’s kind of like paying to clean up what I spilled this year.

Renewable energy credits, while laudable, really only go toward installing future renewable energy –thus avoiding future carbon emissions.

That’s great, but each and every one of us needs to find a way to do two things:

First, pull carbon out of the air that we put up there over the last 100 or so years.

Second, cut our personal carbon emissions by about 8% every year for the next ten years if we want to avoid the worst effects of climate change.

That is the difference between future carbon avoidance.

Thus, trees.

By planting trees, I’m helping to pull carbon out of the system while at the same time I am taking other steps to support renewable energy use today, or cut my emissions personally. We have to do both.

Okay, so here’s the report: it was a little disappointing.

The Arbor Day Foundation annual report was not exactly clear as to how much of each donation goes toward trees or the planting of trees. I’m okay with standard over-head, but I don’t want half of my donation going toward staff or high rent.

I heard back from a staff member who told me that it breaks down like this:

87% – Program Service expenses
9% – Fundraising expenses
4% – Management and general expenses

When I sought clarification about whether the programs within Arbor Foundation (Arbor Day Farm and Trees for America) had, I got this response:

“The overhead for Arbor Day Farm is included in the 20% for Arbor Day Farm and the overhead for Trees for America is included in the 39% for Trees for America (not the 11% for general and administrative).”

What? Is that not redundant?

They then referred me back to the annual report and their federal 990 form.

Circular, huh?

I thought by giving to such a large group, I could take advantage of their buying power and thus plant more trees than if I just went out and bought trees, retail, and planted them.

Later a friend told me about Charity Navigator, a website that tracks and ranks how good charities are at spending your dollars. They gave Arbor Day Foundation a 86.78 score out of 100.

This is not what percentage of their budget goes to programs. It’s a mix of their accountability and how they spend their money.

It looks like about 94% of their budget goes to programs. But even that is not clear.

This points to the general problem with trying to help in this way. I could spend a couple hours trying to figure out what portion of their spending goes to trees, and which to overhead. But, that should be easy for a busy person.

Well, folks. We just completed our tenth year of Phoestivus. It was hard to believe we’ve been going so long!

Here are some of the highlights:

We counted about 12,000 attendees over two nights. That’s about a 20% increase over last year.

Early numbers from Phoestivus indicate that we raised over $17,000 for Community Food Connections, the organization that puts on the weekly farmer’s market, and which works so hard to provide fresh and local food and crafts to our community.

This is an all-time record!

Anecdotally, I heard many vendors say that they brought in significantly more than last year.

Our sponsors, as usual, are amazing. There seem to be more every year and we appreciate each and every one!

We were particularly thankful for our title sponsor, Hownd. They have a unique way to help locally-owned businesses compete in a saturated advertising market. So, we love where their heart is.

The mayor declared December 19th as “Phoestivus Day” in Phoenix. It was such an honor! Then she went over to say hello to Hipster Santa.

Y’all might not know this, but Mayor Gallego has been going to Phoestivus for years, long before she was mayor. So, she deserves the “hippest mayor” badge from us.

We created new relationships this year, too. Walter Productions, famous for their massive art cars, were kind enough to bring Big Red and Walter the Bus over to for people to explore.

Rent.Solar, a mobile solar energy start-up, helped power a bunch of tents and features, thus helping us cut down on noise and carbon emissions.

We introduced re-usable cups for Phoestivus Ale this year and cut down on our waste. We will be partnering with new friends in 2020 to do even better in our vision to reduce waste.

So, every year, we grow a little and improve a little. We love that you love Phoestivus and we look forward to 2020.

Remember, announcements for vendors will come in about September. If you have friends who might like to be vendors, please ask them to sign up for this newsletter on the side panel of the front page of GetYourPHX.com.

See you next year!

You asked for it and we will deliver: more local events and news. There are plenty of events around Phoenix to keep you busy. Here are some of the ones we noticed and we think you might like as well.

1) The fine folks at Local First Arizona are hosting another Good Business Summit on January 22nd and 23rd.

“The 2020 Arizona Good Business Summit will bring over 500 businesses and community leaders together in Downtown Phoenix to discuss the dynamics and complexity of doing business in today’s world. Over this two day conference, experience 35+ keynotes, workshops, business trainings, panel discussions, networking opportunities, and presentations featuring more than 50 local and national experts redefining what it means to do good business.”

2) Our friends at Urban Farm U host events all the time.

On January 16th – 18th and also January 23rd – 25th, they will be hosting pop-up nurseries where you can pick up deciduous trees, bushes and vines.

You could pick up trees anywhere. The difference with Urban Farm U is that they wrap you in a warm blanket of education through podcasts, seminars and library tools.

3) The City of Phoenix is considering rate changes to trash and recycling.

Remember how recycling nation-wide took a punch to the gut last year when China stopped taking our boat-loads of recyclable materials? And, since the US spent the last 40 years out-sourcing recycling to other countries rather than building our domestic recycling industry, we were left in a lurch.

Well, that has led to hard decisions in cities all over the country. Do we charge more to pick up your recycling? Do we stop collecting recyclable materials?

It’s a shame. We spent so many years correcting people when they said that cities don’t really recycle, and then it turns out we may not be able to recycle until the US re-builds its domestic industry. Then we have to start the education process all over again.

Anyway, my belly-aching aside, the City of Phoenix has some hard decisions to make and they need your help. Please see the website announcement here and look for the link for the survey. Please take 3 minutes to fill that out.

4) Americano!, at Phoenix Theater Main Stage. January 29th – Feb. 23.

Stories like these, which humanize the lives of refugees, are not told enough. See the Phoenix Theater site for ticket information.

“This true story world premiere musical follows Tony, the child of immigrants who discovers his undocumented status when he tries to enlist in the Marines. With his lifelong dream of serving in the military vanishing quickly, Tony must confront his family, his heritage, and a deeply divided country. With a sumptuous original score of new songs, Americano! casts a deeply human light on what it means to be a Dreamer.”

5) The Arizona Wine Festival, January 25th and 26th

Over the last 20 years, the wine industry has exploded. I remember hearing stories as a kid in Sierra Vista about mythical vineyards in Cochise County, but “you probably would not want to drink that stuff,” they said.

Well, the wine industry has attracted dollars, tourism and rural economic development, all with a crop that uses significantly less water than other imports such as cotton, alfalfa, almonds and pistachios.

So, tip a glass to that at the Arizona Wine Festival in downtown Phoenix.

“The Cochise Graham Wine Council, Inc partners will present the largest gathering of Arizona wineries. This festival will feature over 25 Arizona Wineries pouring over 200 different wines. The festival will have 5 to 7 food trucks, a vintage village and numerous other non-winery vendors. There will be live entertainment throughout the festival.”

We created the We the People Summit in 2017 to help folks who have never been politically active to learn the basics about how to get involved.

While I was there for the beginning and I’ve done fundraising over the years, there is an amazing core group of women who have organized the details for all of the conferences.

This is a non-partisan, left-leaning conference. But the organizers welcome anybody who wants to learn as they have a general belief that people should feel empowered to participate in their government.

Civic participation is the key for this group of do-gooders.

This will be the last conference of the series. It will happen at a Desert Vista high school in Awhatukee on January 11th. So, just around the corner.

Have a look at this website to learn how to register. General admission is $20 or $10 for students. And that gets you access to a whole host of panels throughout the day.

I’ll be leading a panel on redistricting, as well as a panel on voter suppression tactics and how to combat them.

There are some workshop descriptions that are still being written, but check in here if you want to see what is being offered.

When you are trying to figure out what your home is worth, who can you trust?

If you’ve been following me for a while, you know that I don’t trust the big national companies like Zillow, Trulia and Realtor.com.

These guys have skin in the game. They are in the business of buying and selling homes at the same time we are supposed to trust their “zestimates”?

Further, I regularly hear that people get estimates that end up being higher than the market, and they are disappointed later. Could this be that those companies are trying to entice you to sell by showing you a higher estimate?

You decide.

It was nice to see that AZCentral launched a home estimate tool, in collaboration with the Arizona Regional Multi Listing Service, called Street Scout.

See this article about it. It may be behind a paywall, FYI.

Now, to be sure, I still believe that the best way to get an estimate on the value of your home is to call me at 602-456-9388.

And here’s why: the automated services can’t really tell the difference between a home that has been recently updated, and one that never was –or was 10 years ago. I can look and see the difference.

And there is a price difference of easily $20/sqft, depending on the house.

Consumers are so used to these automated systems that we forget about the importance of talking with a real, live person. The sale of your home is worth the time.

Of course, if you don’t want to talk, you can just go to this web page and send me your address. I will personally do your comps.

Yep. Real live person!

But, let’s go back to Street Scout. The reason this is a game changer is because it uses the ARMLS system directly. Zillow and all those guys don’t have access to the same data as we agents get from ARMLS. They add all kinds of alchemy and conflict of interest.

So, you can get a better sense of what your house should be worth and know that the people behind the data are not also benefiting from the information. ARMLS is a company that we agents subscribe to. It is not run by the agents or firms that profit directly from the data.

This is the same data that I use to estimate the value of your home. The major difference is, of course, that Michelle and I have years of experience in a very specific market in Maricopa County and we will bring that knowledge to our estimate.

For this market update our friends at the Cromford Report are showing a continuation of what we have been seeing for much of 2019 — the number of active listings has been going down, prices are continuing to inch upwards, and the months’ supply has been decreasing.

By the way, when we talk about “months’ supply”, we are talking about how many months we could sell homes if no more homes came on the market today. So, we could continue selling homes for 2.4 months from today if no more homes were to come on to the market.

Notice on the graphic that it is down as compared to the last two months.

However, that can be misleading if you look at it out of context.

Have a look at this next graphic and compare 2019 to 2018. Sure, supply tends to go down at the end of each year. However 2019 has a significantly smaller number of properties on the market.

Were I to turn on 2016 and 2017 in this chart, it would be the same. 2019 has had the lowest supply since 2005.

So, as you might guess, this makes thing difficult for home buyers, especially in CenPho where there is hardly any new construction. We are seeing new construction in the suburban zones, for sure. But home builders are just not interested in the in-fill kind of projects that are needed in Central Phoenix.

Home builders would rather take huge tracks of land and put 200 homes on them, than find a couple acres in Central Phoenix where they may only be able to place 20 town homes.

Volume is the rule for these guys so that they can show a greater profit margin for their investors. So, whoever can figure out how to build in-fill at a profit will be king.

Or –and hear me out– maybe investors should not expect such high profit margins on in-fill constructions.

Boom! Mind blown!