Ready to take advantage of the mild winter we love here? I am. You’ll see me out and about. Here are some good reads and events for your consideration.

Tea Tours at the Japanese Friendship Garden. Japanese tea is seen as an inseparable part of Japanese Culture, with production and practices that started centuries ago. Over time, changes in tea traditions and practices have led to the creation of various schools of tea, cafes, and casual enjoyment, but the pervasiveness in the culture around tea continues to this day. In Japan, having tea allows guests to take a break from the outside world and focus on the simple, transitory moment of serving and drinking tea. $50. Multiple dates and times available.

Get Your Personal Electrification Planner. “Electrification” is the process of eliminating poisonous methane gas from your home and installing dramatically more efficient (and less polluting) electric appliances. I’m doing this in my home. I just got rid of my gas stove, which groups like the American Lung Association show increase risks of lung health issues for children and the elderly. My next step will be to get rid of my gas water heater and shut down dangerous methane gas service to my house completely. This handy website from Rewiring America will help you electrify your home, and save money in the process.

Ride a bike on a tight wire 15 feet in the air. No problem! Reopening after being closed for more than 3 years, you’re invited to experience the Evans Family Skycycle. Suspended nearly 15 feet in the air, the Evans Family SkyCycle teaches riders about the principles of counterbalance and center of gravity while riding the 90-foot cable. The exhibit price is $7. General admission tickets are required. Safety Restrictions Apply. Opportunities occur daily.

Plan ahead for the Local First Good Business Summit. If you are building your local business, you’ll want to be at this keynote Local First Arizona event. It’s an opportunity for locally-owned businesses from across the state to connect and grow as leaders in their communities — working together to form lasting relationships that create meaningful impact for a stronger, more resilient Arizona. It’s an opportunity to be seen, to be heard and to make a change.

Find a Local Business. While we are talking about local businesses, you may or may not know that a great way to support local businesses is to check the Local Business Directory before you shop. It’s easy to default to an out-of-state brand or franchise. This way you can support your community and retain more of your dollars in Arizona.

Jane Goodall Gives us a little hope. Jane Goodall – Reasons for Hope is an uplifting journey around the globe to highlight good news stories that inspire people to make a difference in the world around them. Featured stories such as the Northern Bald Ibis’ migration over the Alps, the re-introduction of the American Bison by the Blackfeet Nation, the worldwide recognized Sudbury Regreening Story, and inspiring youth-led initiatives involved in Jane Goodall’s Roots & Shoots align with historical footage of Jane’s beginnings as a chimpanzee researcher. Jane revolutionized how we view the world around us. Join her on this adventure of inspiration and hope. Irene P. Flinn Theatre. $9 plus general admission. Daily 11:00 AM & 1:00 PM.

Wellness Check List for 2024. I found this nice article that summarizes, and kinda serves as a checklist of ways to live in better balance. Personal health and general sustainability can go hand-in-hand, and this article is a nice summary. It’s given me a few ideas of things I’d like to try this year.

Free Spanish Classes at Barcoa. This is one of the most creative ideas I’ve seen in a while. Evidently patterned after the learn-then-try dance classes that you see all over town. After 90 minutes of learning about Mexican culture and how to speak the language, enjoy an all-night happy hour in the basement with 20% off all cocktails and flights. This is beginner-level Spanish and probably the only school in town where the bar is open! First come basis. Free. The question is how much can you learn after a couple happy hour drinks?

We are hearing from fellow agents that they are busy, but we know there is still a shortage in the market. Paradoxically, a shortage does make agents scramble.

The numbers from the Cromford Report are telling us that the recent interest rate news has not changed the situation much.

For Buyers
Well the balanced market didn’t last long, 7 weeks to be exact. Last month the Federal Reserve gave the housing industry a much needed gift. Not only did they not raise the Federal Funds Rate, they also announced their intention to drop it three times in 2024. Conventional mortgage rates responded by dropping from 7.1% to 6.62% within 2 days. Mortgage rates have now dropped 1.4% since they peaked at 8% in October 2023, saving a borrower nearly $380 per month on a $400,000 loan, a payment decline of 13%. For perspective, each time the rate drops by 1%, the mortgage payment can drop between 9-10% depending on where it started, in many cases saving at least $200/month*. This rate drop was enough to give December’s mortgage applications a boost, which could be a precursor to January’s accepted contract counts.

So what can Greater Phoenix expect for 2024? It’s reasonable to expect some relief, not in the form of declining prices but in declining mortgage payments. Combine this with rising family incomes and we can expect affordability measures to improve along with demand. It’s not reasonable to expect another insane market with skyrocketing prices like 2020-2021, or another 12.5% drop in values like 2022. It could be quite boring in terms of price for the first quarter, but uplifting with more traditional home buyers getting back in the game. Things could get more exciting after the Federal Reserve meets again at the end of January and further reveals their plan for the Federal Funds rate in 2024. Stay tuned.

For Sellers
While Greater Phoenix is out of a balanced market and continually improving, the seller’s market is still very weak so a combination of good condition and price remains key to facilitating an offer within a reasonable time frame, along with an open mind regarding concessions to the buyer. New listings so far in the first week of January are higher than last year, but not high, and while inventory is beginning to rise moderately it’s still 37% below normal for this time of year.

Not all cities are in a seller’s market, the distribution is as follows from strongest-to-weakest:

Seller’s Markets: Tolleson, Apache Junction, Fountain Hills, Chandler, Gilbert, Laveen, El Mirage, Anthem, Glendale, Sun Lakes, Phoenix, Scottsdale, Mesa, Avondale

Balanced Markets: Tempe, Litchfield Park, Sun City West, Peoria, Goodyear, Surprise, Paradise Valley, Arizona City

Buyer’s Markets: Cave Creek, Gold Canyon, Queen Creek, Sun City, Casa Grande, Buckeye, Maricopa

Most cities are either gradually improving or holding steady in their market measures. Sale price measures in January will reflect December negotiations, but with this turn in the market fueled by lower mortgage rates and seller concessions we can expect sales price measures to be sustained in the first quarter. The second quarter could get exciting if rates continue down.

*Talk to a qualified lender to determine your specific circumstance

I wanted to take a moment to thank all of the volunteers who made Phoestivus so great this year. In particular, I’d like to thank Samantha Davis Jackson, Lisa Banish, Sara Esther Anderson for their tireless work to make it happen. (This event takes thousands of hours to put together.)

Special props to Erica Shipione who pulled together an amazing media effort. We got more coverage than ever before.

Thank you to Brooks Werner for arranging Hipster Santa to join us once again. So many people were so excited to see him there.

Thank you, Walter Studios for organizing our first ever speakeasy. It was a hit!

The staff, volunteers and venders show up early on Friday to set up and are there late every night so our community can enjoy all the fun.

You might have seen me on TV, but these folks are the ones who make it happen.

We took a couple major hits in recent years, with Covid and then being moved to a new location.

I’m happy to report that we have more than recovered. Our goal was to remind past attendees of the fun of this event and introduced Phoestivus to thousands more who are new to downtown.

There is a particular “Phoestivus Pheeling” that is so strong at Phoestivus. It is the feeling that this is our unique event, that we’ve all pitched in to make it what it is, and that we can feel a deeply shared joy that is absent from our consumption-driven holidays.

It is why this is the happiest time of the year for me.

That feeling was very strong this year and it inspires me to re-commit to this event for years to come.

In 2024 expect more vendors, more people and more quirky activities that set Phoestivus apart from other events. If you have ideas for fun features, please let me know!

As we go in to the new year there is cause for cautious optimism. Treasury Secretary Janet Yellen said last week that the economy has achieved the “soft landing” that they were hoping for with all of the interest rate increases.

While interest rates are still historically high, this optimism is an early signal that they could really start to drop in 2024.

If you are a regular reader, I’ve predicted that market conditions will begin to improve as soon as the Fed announces that they will not raise, or even reduce interest rates. According to the Cromford Report (below), we’ve not seen that yet. But, I’m not ready to concede. The holidays always run slower than other moths. I think we will see more buyer activity in 2024.

If you are thinking of selling, get ready. Buyers will see that, even if they come in with a high interest rate when they buy, all they will need is a drop of over 1% sometime in the next couple years for a refinance to pencil out. So, they will re-enter the market in 2024. Remember, there continues to be an influx of new residents, plus the institutional investors plus STRs continue to own almost 15% of the inventory. So, inventory will remain tight.

If you are thinking of buying, save your money aggressively and negotiate that raise so you will be ready. Don’t expect the crazy days of 2019-21, but watch for new listings to increase.

Turning to our friends at the Cromford Report, we see a December with fewer listings, and increasing prices.

“Here are the basics – the ARMLS numbers for January 1, 2024 compared with January 1, 2023 for all areas & types:

• Active Listings (excluding UCB & CCBS): 14,593 versus 16,298 last year – down 10.5% – and down 8.7% from 15,981 last month
• Pending Listings: 3,263 versus 3,657 last year – down 10.8% – and down 14.1% from 3,798 last month
• Monthly Sales: 4,929 versus 5,138 last year – down 4.1% – but up 6.4% from 4,634 last month
• Monthly Average Sales Price per Sq. Ft.: $284.85 versus $265.90 last year – up 7.1% – but down 1.5% from $289.30 last month

The market has improved for sellers in some ways since last month. The supply of active listings is down almost 9% since December 1 and down more than 10% from a year ago. It is always good for a seller to have less competition from other homes. The monthly sales count for December was an improvement over November, but is still down from a year ago, when things were already not too good. So this is neutral for sellers. The pending and under contract counts are downright bad for sellers, down sharply from last month and significantly lower than a year ago.

Considering how much mortgage rates have fallen in the last two months, the numbers can be described as fairly disappointing from a seller’s perspective. Lower mortgage rates are supposed to bring out more buyers. So far that is barely noticeable. From a buyer’s perspective this is good news because they have less competition to worry about.

Prices are still stable, up by more than 7% from this time last year when measured by $/SF, and up 4.4% if measured by median sales price. This is a shade more than the latest rise in the Consumer Price Index. The difference between the two price measurements is caused by the strength in pricing in the luxury market. Median sales prices are dominated by the entry-level and mid-range markets which have been weaker than the top end.

We are still very short of 2024 data to show which way things are heading. Both supply and demand are picking up, as we would always expect in January. Supply has risen 0.5% in the first 3 days while listings under contract are up 3%. This is barely enough data to draw a conclusion, but the indicators are better for sellers than buyers. The contract ratio has risen from 35.13 to 35.98. This is consistent with a neutral, balanced market, but with the trend again moving in favor of sellers.

Expect slower activity around the holidays, but a boost in the near year as all those people who were put to sleep by turkey, or were busy hiding their elf on the shelf all December decide to get active again.

From our friends at the Cromford Report:

Here are the basics – the ARMLS numbers for December 1, 2023 compared with December 1, 2022 for all areas & types:

• Active Listings (excluding UCB & CCBS): 15,981 versus 19,155 last year – down 17% – but up 4.8% from 15,247 last month
• Active Listings (including UCB & CCBS): 18,050 versus 21,206 last year – down 15% – but up 4.0% compared with 17,364 last month
• Pending Listings: 3,798 versus 4,301 last year – down 12% – and down 2.9% from 3,911 last month
• Monthly Sales: 4,616 versus 4,928 last year – down 6.3% – and down 11% from 5,210 last month
• Monthly Average Sales Price per Sq. Ft.: $288.97 versus $272.29 last year – up 6.1% – but down 2.1% from $295.13 last month
• Monthly Median Sales Price: $439,000 versus $420,000 last year – up 4.6% – and up 0.9% from $435,000 last month

After rising during October, and peaking at an average just over 8% mid-month, mortgage rates declined thereafter and tumbled throughout November. In theory this should have injected some life into housing demand, but there is precious little evidence of this in the numbers above. We have fewer homes under contract than last month and far fewer than a year ago, when we were all depressed about the low demand. Sales counts are also down from last year and last month reaching the unusually low level of 4,616 in November.

One reason for the severe lack of demand may be that home prices are noticeably higher than a year ago, something few people were predicting 12 months ago. Over the last months there were mixed signals. The median sales price grew almost 1% but the average price per square foot dropped by over 2%. This followed a sharp in crease the month before. When this happens it is usually caused by the luxury market. With much lower unit volumes, the luxury market can vary a lot month to month and the effect on the $/SF can be substantial. The luxury market has negligible effect on the median sales price. The median sales price tends to be strongly influenced by unit volumes at the low end. Despite the weak demand, supply is still below normal which is preventing prices from tumbling. Supply has risen for several months but is now stable again as few people list there homes in December and several take their homes off the market for the holiday season. We anticipate more supply appearing in January.

The new home market continues to outperform the re-sale market. Mortgage rate buy-downs have kept new home demand at a healthy level.

December is not usually a month for us to see a flood of new home buyers, so we anticipate the the second half of January will tell us whether buyers see a big difference between mortgage rates around 7% compared with 8%. The last 12 months have been full of surprises, so caution and watching the statistics carefully is still the order of the day.

Co-op living is great if you need a space that is maintained like an apartment, but you want to own it. Its great if you don’t expect to be nearby all the time. It’s also great if you like a strong and secure community. The one thing to always remember is that co-ops are always cash only, since you are buying what amounts to a share in a corporate entity. Another thing to remember is that the HOA fees seem really high. However, they cover so much more than most HOAs, often including utilities and taxes.

The price of our listing in midtown has come down a bit and the sellers are very reasonable, though not in a rush. So, have a look.

520 W. Clarendon Ave, Unit G2. $286,000, 2br/1.75 ba, 1,320sf. There are a few pristine co-op apartments still in central and downtown Phoenix. Most were built in the 1960s and only a few maintain that mid-century charm. This is one of them. But, on top of that, the owners of this unit opened up the kitchen since and completely remodeled since they purchased the home in 2021. This home is being sold with all of the unique furniture, as an option for the buyer. This secure community is just steps from dining, light rail and shopping. You can lounge in the pool or chill in the historic commons knowing that your investment is being maintained and cared for as a co-op uniquely is. See the listing and more photos here.

No lie, 2020 did a number on Phoestivus. Attendance dropped when we came back in 2021.

Then some faceless developer took our old spot at Central and McKinley to build yet another apartment building with ground floor space full, not of local shops, but with treadmills and exercise equipment.

Do I sound bitter?

Well, about the multitude of community-killing apartments, yes. But not about Phoestivus.

On that I’m bullish.

Despite the setbacks, we grew stronger and we survived. Phoestivus is back and bigger than ever. It now runs Thursday, Friday and Saturday morning, December 14th – 16th.

It is getting more and more like the old German Christmas markets of my youth, which partially inspired Phoestivus back in 2010.

We have an opportunity this year to remind folks why they came, but also to introduce Phoestivus to the thousands of people who have moved in to downtown since we were at the old location.

I’m excited to say that the original Hipster Santa is back!

If you know, you know. And if you know, you are excited by the news.

In addition, we have many of the favorites. We have the Pheats of Strength, the Phoestivus Pole, the Airing of Grievances, food trucks, local beers, and of course over 150 vendors.

Share a ride because parking might be a challenge.

Look for me out there!

This is the sweet time of year, yeah? I’ve got some great reads and fun events for you.

Your Brain on the Internet. I’m not sure how many of y’all take my suggestions for interesting reads or viewings. But if you don’t usually, I encourage you to watch this video. It’s from one of my favorite science-related YouTube channels, called Kurzgesagt, and it describes what scientists have recently learned about how the Internet affects our brains, how it is breaking down our social order, and what we can do about it. Left, right or center, this is worth a watch.

Cosmic Sleighride. Climb aboard your cosmic sleigh with your host Shiny the Star on a mystical holiday adventure that is out of this world at Cosmic Sleighride produced by World of Illumination. Shoot past the sun, race among the stars and pass through Kris Kringle’s celestial portal where toys prepare for launch. Orbit around a team of astro elves hoverboarding through the cosmos as you enter the stratosphere of Santa City, where all the holiday magic happens. Hold on to your seat — you’re in for one stellar ride.

You Can Choose Your Local Power Company’s Board of Directors. SRP has severely restricted residential solar an is installing over 2,000 MW more of dirty methane gas. They are ignoring climate science. You may have the right to vote in the Salt River Project election in March and not even know it. Even parts of APS territory used to be SRP territory and you still may have voting rights. For instance, I live at about Central and McDowell, I’m an APS customer and I can vote in the SRP board election. Funny how they don’t advertise that, huh? Even if you are not certain, go ahead and register at this link and find out. You can see a map of the SRP voting districts at this link. Be sure to scroll down to see it.

Lawn Care Going Electric. If you own a home, there is a good chance you either mow or blow your lawn or desert garden. Gasoline-powered lawn and garden equipment, which don’t have pollution controls, often emit as much pollution in an hour as driving hundreds of miles in a car. Let’s set aside for a moment the war machine-level of noise that leaf blowers set off when they invariably start going on a Saturday morning in your neighbor’s yard. =These things are a huge contributor to Phoenix air pollution and one of the reasons that we are usually in the top 5 or 6 most polluted cities in the nation. Lawn equipment alone in Arizona contributes 985 tons of nitrogen oxide and 333 tons of particulates, which are small enough to invade your lungs. You can learn on this website about ways that you can push our local government to encourage a move to clean, quieter electric lawn equipment.

While we are on the topic, please take a moment to tell the Maricopa Association of Governments what you think they should do to help reduce air pollution at this public survey. The results will help them build a Climate Action Plan and access tens of millions of dollars from the federal government.

Lights on the Farm. Lights at the Farm and Vertuccio Farms have partnered together to bring Arizona’s Largest Walk-Thru Synchronized Light Show. Come on out and unwrap new traditions and make memories with your family and friends as you make your way through the dazzling lights, larger-than-life lighted displays, mesmerizing tunnel of lights and so much more. Lights at the Farm offers a holiday entertainment experience for all ages. They’ve decked the farm with 2 million dazzling lights, brilliant decor, and inspiring displays to create a Christmas light show. Each display is synchronized to a variety of Christmas classics that will have you singing along. It is stretched out over 10 acres; these dazzling lights will take you through a spectacular journey that will delight your senses and put you in the Holiday spirit.

Did we Abandon the Greatest Economy in History? This is relevant to why so few people can afford a house now, at least the long term view of it. This is a great article on the history of the political shifts that took us from economic domination in the 1950s to space where the disparity of income is about as large as it was during the gilded age. Hint: if you are thinking its an all-left or all-right account of history, you’d be wrong.

Clean Energy Jobs in AZ To Date. Expect the Arizona economy to grow and people to continue to want to move here, as Arizona is now an EV manufacturing state and clean energy jobs are growing. Since the passage of the Inflation Reduction Act (IRA), we’ve seen more than 13,000 new jobs in Arizona, from about $12 billion in investment.  As you can see in this data, Arizona is becoming a battery manufacturing powerhouse, according to the latest report from Climate Power.  As you think about whether to buy or hold in Arizona, this lends support to long-term investment.

How to Shop Local with Ease. Local First Arizona has a great online shopping portal so that you can support local businesses with a click of a few buttons. Many Phoestivus vendors are on the portal, as well. So, if you don’t feel comfortable in the crowd, you can still delight your friends and family with original gifts. 30% more of your dollar goes to support local police, fire and community services when you shop local.

Southwest Gas is the new Marlboro Man. Well, more specifically, the methane gas industry is the new version of that 1960s doctor telling you smoking is good for you. Recent reporting from NPR revealed that the “natural” gas industry quite literally used the Tobacco industry playbook to mislead the public about the health threat of gas stoves. The American Gas Association (AGA) hired the Tobacco industry’s go-to public relations firm and the same industry-friendly researchers to deploy the same tactics to cast doubt on the science. These tactics continue to this day — the AGA hired a Tobacco-linked consultant to sow doubt about the science earlier this year.

Why aren’t we Recycling Lithium Batteries? The best way to avoid opening more lithium mines is to recycle more. After all, we recylce 99% of lead-acid batteries from cars. Why is less than 5% of all lithium recycled? Is it because the government started requiring car batteries be recycled back in the 1960s, but now anybody can sell lithium batteries and leave society with the cost of finding more? Here’s an informative treatment on what’s going on. The EPA has a nice primer on lithium mining here, too.

I’ll leave you with this thought. Critics of climate change policy claim that China pollutes more, so they should fix the problem first. Set aside that this is only true if you look at today. Over the last 150 years, the US has added about 4 times as much carbon to the atmosphere as China. Once we look at current investment in renewables –and the potential to capture more global market share in clean energy manufacturing and technology–, you can see that the US is giving up its leadership position to China. China invests about $266 billion per year in renewables. The US sits at about $115B, with a much larger economy. Who’s winning that space race now and who is ceding leadership? (Source: Bloomberg)

As you may know, I serve on the Advisory Board of Voter Choice Arizona (VCA), a non-partisan, nonprofit that, for the past three years, has been educating Arizonans about election reform and the incredible benefits it can bring to our state by giving Voters more voice and more choice. 

VCA’s sister organization, Better Ballot Arizona (BBA) has recently filed for a citizen’s initiative that, when passed, will equalize signature requirements for all candidates, establish a single, non-partisan primary, and allow voters to use Ranked Choice Voting in a top-5 general election.

If you don’t know about how these reforms can reduce negative campaigning, eliminate the “spoiler effect,” and lead to better governance, please invite the VCA team to share their presentation with you and your friends, or meet up for a one-on-one conversation.

If you already understand how better ballots can improve our elections, please consider joining me in donating to Better Ballots Arizona. They have a $10k match from a donor that expires on October 31.

You can donate and learn more about the campaign at betterballotaz.org.

To arrange for a presentation at a house party or group meeting, visit VoterChoiceArizona.org.

If you have further questions, feel free to reach out to me, or VCA Executive Director, Kazz Fernandes at Kazz@voterchoicearizona.org.

Don’t you love those mornings where you walk outside and get a little puff of “almost chilly” air on your cheek?

Well, along with the cooler temperatures come a little more activity in the market, at least compared to summer. Yet, that comparison between summer and fall does not over-come the year-over-year doldrums that we are experiencing as a result of higher interest rates.

Here is what our friends at the Cromford Report are, er, well, reporting. Notice, if you will that sales prices are actually up from last year by a smidge.

“Here are the basics – the ARMLS numbers for September 1, 2023 compared with September 1, 2022 for all areas & types:

• Active Listings (excluding UCB & CCBS): 13,404 versus 20,084 last year – down 33% – but up 12% from 11,969 last month
• Pending Listings: 4,264 versus 4,862 last year – down 12% – and down 7.4% from 4,604 last month
• Monthly Sales: 5,563 versus 6,460 last year – down 14% – and down 11% from 6,261 last month
• Monthly Average Sales Price per Sq. Ft.: $285.08 versus $276.60 last year – up 3.1% – and up 1.1% from $281.99 last month
• Monthly Median Sales Price: $432,000 versus $439,000 last year – down 1.6% – and down 0.7% from $435,000 last month

Mortgage rates have hit their highest levels in 20 years and the impact on demand can be seen in the numbers. Listings under contract fell another 8.6% from the dismal level of last month. Closed sales were also disappointing dropping another 11% from last month.

New listings remain scarce, but the flow has increased over the last 2 months. Demand is so poor that the active listing count is starting to build, up 12% over the last month. However it remains well below last year at this time.

The balance between supply and demand still favors sellers in the majority of markets, (emphasis added) but negotiating power is swinging towards buyers with every day that passes. Supply rising and demand falling means this trend is gathering strength. If interest rates remain in the high sevens or increase further, then we can expect market balance to hit within 2 months or so. However we usually see a significant weakening of supply from the middle of November to the end of the year and this could temper the downward direction in the Cromford® Market Index.

Demand remains much better in the new home market, though even here buyers will find it increasingly hard to qualify for loans if interest rates get closer to 8%.”