Yes, It Takes Longer to Sell Now

This has been an interesting year, because so many people think I am exaggerating when I say that the average time on market is 90 days!  I usually get a "yeah, sure..." type of look and response.  They think that "just last year, homes here were selling in a couple weeks, and now it will take 3 months?  No way!".  I can't blame them for this line of reasoning, if I were not as "tuned in" to the market as I am, I don't know if I would believe me either.

Here are two graphs that show just how much the market has changed since last year, and how different the patterns are than they used to be.

#RealEstate #Avondale , #Goodyear , #Buckeye , #Glendale,  #Phoenix, #Surprise, #Peoria, #Tolleson, #Laveen, #Waddell , #Wittman

The Importance of Questions

As a listing agent, I have lots of interesting conversations with Buyer's agents.

Usually, when I receive an offer, all I get is an email.  Sometimes it has an "important" flag, and sometimes it doesn't.  It is rare that I also receive a phone call to let me know that an offer has been sent, on the off chance that it was sent to the wrong email address.

When I get the offer, the first thing I do is call the other agent and ask them lots of questions about their client, the activity they have had, and about the lender.  For some reason, this seems to annoy many agents!

Why would a Buyer's agent be annoyed at getting questions about their client and their history?

I ask questions like:

1)  How long have you been working together
2)  Have you made any offers
3)  Have you ever worked with this lender
4)  Where have you been looking
5)  Why did you choose this house

And depending on the circumstances, I ask other more penetrating questions.  For example, if the Buyer wants huge concessions, I will ask the other agent if their client has any cash, or if the transaction hinges on the Seller providing closing costs.

To me, all these sound reasonable.  I can take the information back to my Seller, and give them a complete picture of the Buyer, and give them a feel for what course the transaction will take.  I can give the Seller a reasonable expectation of the success of a transaction.  I can say "If you accept this offer, your house is going to be tied up in escrow for a month, and you have a 50% chance that it will close", or 75% or 95% or whatever.  However if I didn't ask the questions, I wouldn't be able to say that.

Don't you want your Seller or Buyer to be able to have confidence in their decisions?  That's what the questions are for.  That's why people like my services so much - I actually find information that helps them!


#RealEstate #Avondale , #Goodyear , #Buckeye , #Glendale,  #Phoenix, #Surprise, #Peoria, #Tolleson, #Laveen, #Waddell , #Wittman

Canadians and Californians Leaving Arizona Market?

From the Cromford Report:  Demand is down almost everywhere but it is particularly down hard compared with last year for our two biggest out-of-state buyer groups - Californians and Canadians.

• Californians only purchased 295 single family and townhouse/condo homes in Maricopa County during June which is 34% less than in June 2013
• Canadians only purchased 126 homes which is down 33%

The decline is even more dramatic if we go back two years or more.

Overall out-of-state purchases dropped by 16% over the last 12 months so the fall is more than twice as large among our best customer groups. However in-state purchases only declined by 5% so it seems that Arizona's attractiveness to out of state residents has take a significant hit over the past 12 months.

Median Sales Prices in Phoenix a bit Misleading

This graph is misleading.  A quick glance makes it appear that the economic plan is gaining favor.  Yet, a close look reveals that the time frame moves from right-to-left.  Confidence in the plan is actually dropping!

The current median sales prices for the Phoenix area are also misleading - Mike Orr from the Cromford report described it this way:

July 6 - It's all in the mix. If we examine the monthly median sales price for all areas & types we get $196,200 today, which is up 7.2% from this time last year. However the majority of that price improvement is due to a change in the mix, not an increase in home sales prices between July 2013 and now. This is revealed if we look at the individual monthly median sales prices for the 3 major types of transactions across Greater Phoenix:

• Normal sales - $205,000 - up 2.5% from $200,000 last year
• REO sales - $134,045 - down 1.5% from $136,050 last year
• Short sales & pre-foreclosures - $138,000 - down 1.4% from $140,000 last year

Two of the categories are down from last year while the third (and most important) is up a mere 2.5%, not much more than inflation.
The big change is in the share of the market that each transaction type has taken:

• Normal sales - 89.7% - up from 79.5% last year
• REO sales - 6.5% - down from 8.7% last year
• Short sales & pre-foreclosures - 3.8% - down from 11.8% last year

The swing away from distressed sales (which have much lower prices) towards normal sales (which have slightly increased prices) accounts for a much larger increase in the overall median sales price than for any of the 3 individual transaction types.


#RealEstate #Avondale , #Goodyear , #Buckeye , #Glendale,  #Phoenix, #Surprise, #Peoria, #Tolleson, #Laveen, #Waddell , #Wittman

Credit Unions are Hassle Incorporated

The US Government has not made life easier on anyone with their meddling in laws governing the creation of mortgages for people buying homes.  The upshot of the laws has been that - as seems to be the case everywhere - mortgage people have to do more, be responsible for more, and be personally liable for more.

Processing of mortgages at credit unions is particularly adversely affected by these laws.  The reason is that credit union loan officers do not work on commission! 

You might think this is a good idea.  You might think "Why should I pay $3000 for a loan at a mortgage bank, when I can pay $650 for a loan at a credit union?"  That's a fair question, let's answer it!

First, consider that over the course of a 30 year loan, the $3000 you pay for a mortgage professional to do your loan is $8.33/month.  The $650 you pay a paper shuffler is $1.80/month.

When you hire someone to work for you, do you check their resume, or check their online ratings, or at least do a comparison of the prices they charge?  Lots of people do all three.  Many people take into consideration the type of job they want done, and find the services that they think will produce the desired outcome for the minimum amount of money.

So to begin with, when you hire someone to do your loan for you, you need to think about what type of person you are hiring to help you with the biggest purchase you are ever likely to make.  The results of this decision will bind you for the next 30 years.  So you should take into account the reputation of the company and the individual that you will entrust with all of your financial information.

Do you really want a $2.70/hour paper shuffler to do your mortgage?  That's what a $650 loan origination fee buys you!  $650 divided by 30 days divided by 8 hours/day.  And you can't call them on the evenings, weekends, or holidays. Files just sit there if they are on vacation, because there is no one else to handle them.  These people can make the same amount flipping burgers with a lot less hassle.  They do not have reviews that are available to the public.  There is a chance that your loan officer was just moved to mortgages from the auto financing department.

Would you rather have a $12.50/hour professional handle your loan?  That is $3000 divided by 30 days divided by 8 hours/day.   With a professional, you will have 24 hour a day access on weekends and holidays.  They have a team of professionals working with them to take up the slack if they are sick or take a vacation.  These people are driven to make your life run as smooth as possible, because your comments on their review will be available on the internet.  Mortgage processing is all these people do.  There is a good chance that mortgage processing is all they have ever done, and they know it backwards and forwards.

If you are one of those people who always take the cheapest way, and don't mind the hassle, lack of communication and lack of concern for your situation, then a credit union mortgage might be for you.

If you want professional care, and appreciate smooth processing and the anticipation of any problems so they can be fixed now instead of being a crisis later, you might want to consider this type of professional for your mortgage.


#RealEstate #Avondale , #Goodyear , #Buckeye , #Glendale,  #Phoenix, #Surprise, #Peoria, #Tolleson, #Laveen, #Waddell , #Wittman

HOAs Are Pretty Nice Now

Not so long ago, Home Owner Associations (HOAs) prevented people from flying the flag, putting solar electric on the roof, parking in the driveway, and a whole host of other rules.   From the beginning, HOAs were a good concept, but seemed to be modeled after some high-rise apartment in New York, not the personal freedom concept that people embrace in Arizona.

HOAs are no longer allowed to fine you for leaving your trash can out too long, or for debris that accumulates as you are trimming trees and shrubs.  The only thing that they can now fine you for, is not paying your HOA dues.

Most HOA dues in the Phoenix for single family subdivisions are between $45 and $65 per month.  The amount of the dues depends on how much the HOA has to maintain, how many households there are in the HOA, and whoever the HOA board decides to hire.

When I bough the house that I am currently living in, HOAs were a new concept.  They regulated just about everything from the number of trees that you must have in your front yard to what colors you could paint your house, and whether you could park on the street over night.  For the most part, the rules didn't bother me, and I would get an occasional nasty-gram telling me about the construction debris left in my yard (I used a brick to prop open a gate, and forgot to put the brick behind the gate when I was done) or that I left a trash can out too long.  No big deal.

Now HOAs are "paper tigers" since the Arizona legislature has taken all their teeth by not allowing them to fine you for anything except not paying dues.

Meanwhile, I live in a community with large park areas where children play ball, nice shaded walking paths, and a nice community where the condition of your home is regulated by the peer pressure from the neighbors, just like in the old days.

I like it!


#RealEstate #Avondale , #Goodyear , #Buckeye , #Glendale,  #Phoenix, #Surprise, #Peoria, #Tolleson, #Laveen, #Waddell , #Wittman

Phoenix Market Growing Stonger!

How can I say that the Phoenix market is getting stronger?  After all, Sales are down this year from last, Mortgage rates are creeping up and Obtaining a mortgage is difficult.  The graph above is what gives me hope.

Please note that Q2 in of each of the past 4 years has had the greatest number of sales annually.  Look at how the dark blue bars - representing "Normal" sales - has increased while the number of Foreclosure Sales (represented by the red bars) is practically down to nothing!  This means that our market is now being "powered" by people selling their homes.  It is no longer dependent upon the banks!

This also explains why values are going up, even though total sales are down.

Next is what amounts to a political "sound bite".  It is true information, but taken without a complete understanding of the encompassing environment, it doesn't tell the whole story.

From the Cromford Report - Friday June 20 - The annual sales rate is an interesting measure because using a full year eliminates the seasonal effects and allows us to detect whether demand is growing or declining. For the major types of homes on ARMLS we see the following changes in the annual sales rate comparing Greater Phoenix for June 20, 2014 with June 20, 2013.

• single family detached - down 13% from 73,512 to 64,147
• townhouse - down 8% from 5,789 to 5,312
• apartment style - down 9% from 4,119 to 3,742
• patio home - down 11% from 1,331 to 1,191
• gemini / twin - flat at 608 both years
• mobile home - up 6% from 1,614 to 1,717

We see that attached homes have fallen less than detached homes and that mobile homes are in higher demand than last year.


#RealEstate #Avondale , #Goodyear , #Buckeye , #Glendale,  #Phoenix, #Surprise, #Peoria, #Tolleson, #Laveen, #Waddell , #Wittman