Predictions for the Greater Phoenix Real Estate Market

This is a portion of an article written by our broker, Jim Sexton in the Arizona Journal of Real Estate and Business for December.   The first half of the article deals with variables to be resolved post election by the president.   Jim’s predictions follow:

 “2012 will have around 90,000 sales reported by ARMLS, which will be a 10-12% drop from 2011 numbers, but the overall dollar volume of those sales will be up almost 6% from 2011.  The average price per square foot will be up over 13% for 2012.  Using these trends, I believe that the number of sales in 2013 will remain around 90,000, although if I could give a range it would be 85,000-95,000 sales for the year.  I think prices will continue to bounce back.  I don’t expect another 13% increase, but I see a price improvement in the 5-8% range.  I expect active inventory to rise from the current less than 3 month supply to the more balanced 3-4 month supply.  Both short sales and REOs

will continue to decrease.  Distressed properties made up 70% of the market 2 years ago, 65% 1 year ago and currently are at 41%.  Look for that downward trend to continue to under 30%, with REOs below 10% and short sales dropping to around 20%.  Also expect to seeArizona’s population continue to grow and the building industry inPhoenix‘rise from the ashes’.  Both will continue the positive steps we’ve seen to our economic recovery for the region.”

 Based on Jim’s experience, knowledge and his great batting average we are expecting that 2013 will be a successful and positive year for real estate in our Valley of the Sun.

 

 

CantaMia – a new 55+ retirement community

dreamstime_l_5059099CantaMia is another great example of locating an Active Adult Community within or adjacent to a multigenerational community.   It offers the opportunity for the 55+ family members to enjoy their extensive exclusive Active Adult facilities as well as share the additional recreational activities with their families who live in the Estrella ranch community.   This I think is the best of both worlds.   It is also interesting to see that as families in Estrella grow and reach the empty nest stage, they are purchasing in the adjacent CantaMia!

CantaMia was designed by Engle Homes, but no construction was started. It was saved from bankruptcy by Joseph Carl Builders, who then joined with Avatar homes (AVHI on the NASDAQ) under the name of Vitalia by AV Homes.   The total number of homes when built out will reach 1700, a fairly small community by some standards.   The recreational activities however are equal to those of the much larger communities.  The 29,000 sq ft Village Center has indoor and outdoor pools, a beautifully equipped demonstration kitchen, an excellent variety of exercise and activity centers as well as a mini café and wine bar.  The workout room boasts a cushy bamboo floor and the computer room and fitness center have instructors from Estrella Community College.  The common areas use reclaimed water for irrigation in keeping with their entire energy saving theme.  There are 14 model homes to guide your home choice, with emphasis being on their Green building techniques.  Check the current prices on our website.  The builder is a member of the Environments For Living, and is a Green Certified Builder.  The homes have been tested for efficient use of utilities and are awarded very high scores. All homes include solar as an energy source.    In keeping with the Green living, the exercise, cooking and activity programs are designed to encourage healthy life choices.  CantaMia’s Sierra Estrella Mountain views and many lakes provide a tranquil and relaxing setting in which to enjoy your healthy retirement.

CantaMia, an Arizona Active Adult Community

I recently visited CantaMia and discovered this jewel in the Estrella Mtns

Market Update – May

Talk Fusion Studio UTC.
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If you read the real estate news in your newspaper, any day now you will be reading that the real estate market has turned!   UP for a change. 

The right numbers are positive and the right numbers are negative….what I mean is the Sales prices are up.

 Really good news is that the percent of sales to list price is  98.3%.    The “make a low ball offer” period is over.  The lender owned homes are selling with multiple offers, almost to the point of bidding wars.   The number of “conventional seller owned” homes are up.

The right negative numbers are for inventory. The number of lender owned and distressed properties is way down.   Our inventory is very low, actually 47% lower than it was first quarter last year! With a total number close to 13,000.  April’s closings were 8400 The month supply is rated at about 1.5 months !    There are 20,500 sales shown as pending and Active with Contingencies. 

The Active Adult 55+ market presently has 2131 homes for sale with 898 sold in April, another 920 pending  and a current supply of 2.3 months.

These numbers are being repeated in select cities across the country, not just the Phoenix Valley of the Sun. 

To make things even better in the real estate world, the interest rates for the conventional 30 year mortgage  are hovering around the 4% level.

 

How much do I need to put down on my home loan?

For conventional financing that answer is going to be: it depends. With great credit as little as 5% down has you in a conventional loan. With mediocre credit, 10%. But to eliminate the mortgage insurance you still need 20% down. Sometimes, with a bit more down, you may be able to get a better rate. Having a lender who will talk to you and find out what your needs are and presents different options is the best thing. Robyn Robertson from Suburban Mortgage (480-355-8106) talks to me in this video about different types of conventional loans and what is available today in the ever changing world of home lending.

The home buying process, the loan and what you should know

Once you have found the house and had your offer accepted there is a lot that needs to be completed. If you get all your paperwork into the lender in advance that is one less thing that needs to be done in the first week.

Find out what you qualify for before house shopping

I sat down with Robyn Robertson from Suburban Mortgage today. (480-355-8106) We talked about how just over the phone in a quick conversation she could estimate what you should be able to qualify for in a loan. But before you head out and get serious, be sure to get all the documentation to her to confirm the numbers, and get the Pre-Qual form filled out. It not only helps when submitting your offer, but also makes the first week of the contract process easier with lending requirements already taken care of.

April 2011 Market Conditions

Here is the April 2011 Market update from my broker at John Hall & Associates, Jim Sexton.

REO/Short Sale/Normal – What’s really selling in the Phoenix area housing market

I was looking through the charts and statistics and came across these 2.  They offer an interesting view on what homes are selling, and how much of our housing market is really about the foreclosures.

From the chart below you can see that steadily for the past 6 months the REO (bank owned properties) are about 15% of the active listings. The Short is for short sale listings running at about 35% and Normal, is a regular buyer and seller no bank involved is still 50% of the homes on the market.

active-listings

Compare the above chart with this one and you can see REO (bank owned property) sales dominate. Currently about 45%, down from 55% of all the sales are REO’s.

Normal transactions having 35% of the sales (back in Nov what was thought to be the end of the home buyer tax credit and people were looking to make the home purchase happen and not mess with the banks)

The Short Sales have increased from 15 to 23%.

monthly-sales

What does all that tell me, a few things?

1.       Bank owned homes sill offer the best value

2.        Banks are starting to approve short sales.  (it sure has taken a long time)

3.       With more short sale approvals, fewer homes are going to foreclosure

4.       And there is nothing like a home that has been loved and taken care of

This just in: People are buying homes!

Chicken Little’s  “The Sky is Falling” is everywhere in the papers.  I figured a little positive press would be welcoming.

 

People are buying homes!  

 

There it has been said, now for the proof.  January statistics are in and the Arizona Regional MLS has published their report for this month.  

 

January is the 8th consecutive month of increased sales comparing months year to year.  January 2009 had 4742 closings that is a 63% increase over January of 2008 with only 2912 closings.  

 

January 2008 was the slowest month for closing in the past 8 years.  I don’t expect we will see that 63% increase again next month.  Time will tell though. 

 

The closings in January and in the past few months are more comparable to those in 2001, 2002 and 2003.   This is all good news, there are still a lot of homes on the market and hopefully, we will see the inventory start to lower as well, when that happens prices will stabilize.