Ode to the Phoenix Monsoon
August 27th, 2008 categories: Local Color
The beauty, serenity and grandeur of the Phoenix monsoon almost makes the humidity and heat, a miserable combination, worth it.
Indeed, the sunsets, sunrises and the huge thunder clouds that often surround the valley are spectacular, especially during a sunrise. The best way to view these clouds is either in the open desert or on a small hill.
Hiking in the Phoenix Mountains and seeing the glowing warm sky and the shimmering lights of the city makes for one inspiring and grounding moment.
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Greater Phoenix Real Estate Market and a Forecast for the Near Future
August 24th, 2008 categories: Market Trends, Phoenix real estate
We have been getting a lot of questions about the current market and the forecast for 2009 and I bet this question is tops on many peoples minds.
The answer really depends on whom you ask because, it’s all a guess, an educated guess, but it still involves an abysmal jump into the crystal ball. Some say that we’re in for further corrections while others say that we are at or near the bottom.
The answer often depends on the property type, the location and your plans, so the answer is further complicated. The bottoming of the market is a long process and there is just so much to consider that is going on currently and things that are ahead. Just look at the big change that appeared a few weeks ago, namely the recent Housing Bill that was passed.
Then there are the continuing troubles at Freddie-Mac and Fannie-Mae: the high inflation rate; the slowing of money changing hands and a slowing global economy. What will the impact be? Plus other things that have yet to happen as a result of this correction.
Inventory is very important as an indicator of the market trends. While the lack of financing has hurt the market the total vicious circle created an influx of inventory which was exasperated by the lack of financing. Current inventory is down from the high of 58,334 experienced in October 2007.
This current number of 53,725 (8/21/08) represents 9 months of inventory. Months of inventory hit a peak at 21 months. Inventory has been dropping partially thanks to the more buoyant buyer market and the lower number of new listings to the market. In addition new home construction is at at 17 year low. This is all good since the worst that can happen is for more homes to be built while so many still stay vacant waiting for an owner occupant buyer. Take a look at the unit sales per month over the last several quarters. (Greater Phoenix Housing Market Data July 2008 ) Sales are by no means at the 2005 levels but we should really discard the last frantic peaks and consider the long term trend. For July sales are up close to 40% over the same period last year.
This increased interest from buyers is a result of the healthy correction in pricing. The hefty declines in housing prices means that homes are within reach of many more buyers. In fact the first time home buyer or the starter home market is very active indeed. It’s the segment driving the sales now. (Phoenix Starter Home Sales)
The median home price has dropped to $196,000 in the valley while it has dropped more in the outer cities like in -21% Goodyear, -16% in Surprise, -27% in Queen Creek, -15% Glendale, -17% Gilbert and -17% in Chandler. (Change annualized. The decline much higher on a month to month change) The peak for pricing was $360,000 in 5/2005.
While pricing in most areas continues to decline there are some areas which have seen recent and mid term increases. Lower prices, increased demand, lower inventory are all indicators of stability and following stability we’ll have growth in most cases.
All to often buyers and investors forget how crucial financing is, in real estate. I have always stressed this with my clients. Often the financing is more important than the property itself. One of the major benefits of real estate is leverage. This leverage is achieved with financing and if it’s the wrong type of financing or it can’t be obtained then the investment/purchase may not make sense. Even people who purchased at the peak but had good financing can often whether this corrections unlike so many that got the wrong loan. More so the individual elements of financing need to be considered, the terms along with timing the market.
Depending on your hold time and exist strategy taking advantage of the current interest rates may make more sense then waiting for additional declines if there is a high risk of interest rates increases. So, unless you’re buying with cash take into account all factors, more so if you’re building a real estate portfolio but also if you’re buying a home to live in.
No one knows where mortgage rates are heading but we have been in a multi year low and they will be heading higher for many reasons of which I won’t go in here.
The Phoenix real estate market is in the midst of a drastic change. Prices are very low. In some areas they have not been this low since the early years of this decade. Long term buyers are starting to see the opportunity for long term growth.
Take into consideration the inflation of building materials and the increasing global demand for them. Many of the homes that can be purchase now are well below the replacement cost. Other homes sit on land which itself is of very high value.
Big money is sitting on the sidelines.
There is a lot of big money sitting on the sidelines just waiting for the right moment and that moment is approaching. This money is coming from wealthy individuals to large hedge funds. Most won’t be buying individual homes except for maybe foreclosed homes in bulk but they will be buying up entire subdivisions, unfinished projects and other opportunities. There are individual groups as well who have pooled their money and are beginning the exploratory process. I know because I’m getting the multiple calls. Any sort of money that will roll through the real estate market is good.
Greater Phoenix is a very strong city with a bright future and sound fundamentals; Phoenix is in demand. This along with the lower prices, low interest rates, a decent rental market and increasing demand makes for a very sound opportunity that we may not see for a while. It may be prudent to wait but it may not.
It’s difficult to say but take into account all that I have covered above and maybe it’s right. Just don’t try to time the market. Remember that most people buy high and sell low. Most do it because of fear, but that is the worst emotion on which to base such a decision. This corrections will probably be a long one and it’s difficult to say at which stage of the cycle were in. Still, the fundamentals for Phoenix valley are very good so we should be in strong position as the cycle turns up again.
If you have specific questions please don’t hesitate to contact us. We love to hear from our reader and we’d love to have you as a client.
Original Post: PMT
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Phoenix Uptown, Midtown, Downtown Housing Market July 2008
August 18th, 2008 categories: Market Trends, Phoenix real estate
Sales or all property types in Phoenix Central are up to 63 in July from the very bleak 28 in December 2007 but they are still down from last year despite the fact that sales for Greater Phoenix were up 39% from last year. The reason sales in Central Phoenix are down is because the bulk of the market right now are sales up to $240,000 which represent 67% of all sales. There are very few homes in Central Phoenix in that price range. Even starter homes are more expensive.
The table above show all sales by zip code with the number of sales in each zip code, the average days on the market and the average sales price.
The table below is segregated by property style in the same zip codes above. The bulk of the sales were single family homes but there are a lot of condos, townhomes, lots and patio homes selling as well.
Popular Links:
Search for homes in Central Phoenix
Greater Phoenix Housing Market
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Central and North Central Phoenix Real Estate Market
July 24th, 2008 categories: Phoenix real estate
Below is a graph with the home sales in Central Phoenix, North Central Phoenix and the Biltmore area for the last 30 days.
If you look at the pending sales which hopefully will be future sales the number is increasing. So despite the meager sales in June the sales in July shoud be higher. Still overall the supply is quite large and this is well indicated by the very long time on the market. The average for the valley is 97 days while it varies from 90 days to 217 days in Central Phoenix.
None the less prices are holding quite steady but the wave of foreclosures that started in the outer cities is quickly moving in.
If you would like to see the resale data for greater phoenix please visit Phoenix Market Trends to see current graphs and historic numbers of the Phoenix real estate market.
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“Concentrated Wisdom” just a click away :)
July 21st, 2008 categories: Edits, Responsible Living
Another of Brian Johnson’s brilliant ideas has been recently realized in a form of : “PhilosophersNotes”.
Perhaps you see “free time” as luxury, but your main focus is always to move FORWARD in all areas of your life. Looking at a long shelve with self-development books, you just know, it will take too long to read all books you crave.
Brian thought of people like you:
“In less than 15 minutes a week, we’ll get you thru the Big Ideas of 25 of the best self-development books ever written—you’ll get a 6-page PDF and ~20-minute MP3 for each title so you can decide if you’d prefer to read over a cup of tea or listen on your way to work, on a hike, at the gym, doing errands or whatever’s best for you!”
And he continues:
“We’ll gain mastery in spiritual economics (we MUST learn how to integrate our spirituality/self-actualizing with our bank accounts, no?), health and fitness (how can we possibly live at our highest potential if we have a hard time getting out of bed?), and relationship skills (love, love, love!!). We’ll learn a bunch of ways to discover our purpose/dharma, how to follow our bliss, how to feel the fear… and do it anyway and how to live the 7 habits of highly effective people. And, we’ll study the science of getting rich and the magic of thinking big. And all kinds of other goodness.”
I have to say: I do like it.
In some cases- before you finish a second cup of morning coffee (or green tea : ) you read one Summary, (sometimes it takes longer) you mood is set, you are energized - that is how Brian writes, and you just learned something very practical that you will be able to apply immediately to many situations throughout the day.
Click on the icon here in the post, and start reading and enjoying!
(What I have read this morning: a Summary of ” Self -Actualizing People” A. Maslow)
Get a 6-page PDF and >< 20-Minute Mp3 for each title. Click on the icon or here.
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What Do Lending Changes Mean for You?
July 17th, 2008 categories: Market Trends
It appears we can expect home loans to be back to Full Doc only by late 2009. See the changes approved by the Federal Reserve
This is like it was in the old days 20 years ago. There may some versions of Limited Documentation but the good old Stated Income Loans may be difficult to find by late 2009.
This maybe a good time to get off the fence if you’re Self Employed/Stated Income type buyers?
Start looking for homes in Phoenix.
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Quick Facts About Downtown Scottsdale
July 14th, 2008 categories: Downtown Scottsdale
As one of the most acclaimed tourist areas in the state of Arizona, Downtown Scottsdale provides an eclectic mix of southwestern and contemporary art galleries, specialty retail, upscale dining, action nightlife and cultural attractions for residents and visitors alike. This notoriety was recently reinforced by the New York Times, who ranked Downtown Scottsdale No. 9 in its top 31 Places to Go This Summer. The top billing was based on Scottsdale’s luxury hotels, nightlife and summer resort packages.
DOWNTOWN SCOTTSDALE BY THE NUMBERS:
> 786 acres
> Free trolley service - 7 days/week, 12 months/year
> Year-round Thursday Art Walk events, 7-9 p.m.
> Signature events including Fashion Week, Savor Scottsdale, and Via Colori
> Free downtown parking
> 2,500 residential units
> 3,300+ hotel rooms in 20+ hotels
> 100+ art galleries
> 50+ lounges, bars and nightclubs
> 85+ restaurants
> More than 50 public artworks
> 30,000+ visitors on any given weekend night, year-round
(from Downtown Scottsdale enewsletter)
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View new listings in Uptown, Midtown, and Downtown in style with BIG photos.
July 14th, 2008 categories: Homes For Sale, Phoenix real estate
RealEstateConfluence will now feature the newest listings to the Central Phoenix market with BIG photos. How big are they? Up to 6 inches wide. You won’t find photos that big in many places. One of the few other ones is at PhoenixMarketTrends.com which listing in places like Paradise Valley, the Biltmore Area, Arcadia and The Phoenix Mountain Preserve. The listing are updated every few hours with the newest ones on top. Look below and click on any of the area you have an interest in to see these properties for sale. After that if you see one that you like just select the address and you’ll see the property on a map with more photos and full details.
Uptown Phoenix
Central Corridor Condos / Townhomes
North Central Phoenix Condos / Townhomes
Midtown Phoenix
Phoenix Midtown Condos / Townhomes
Downtown Phoenix
Phoenix Downtown Condos and Lofts
Do a more extensive Phoenix home search by map.
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Contemporary Home close to Phoenix Mountain Preserve
July 11th, 2008 categories: Architecture, Contemporary Homes, Homes Worth Buying
Humane scale, lots of light and ongoing interaction with the outdoors, thanks to walls of glass on the first level. Every room offers something exciting. Upon entering we see an open space that can serve as a family room, dining room. Kitchen in the background. I am thinking: Paul Rudolph’s Casey Key home in Florida. And I don’t think this association is too far.
The builder’s representative, Cortney Smith, answered a couple of questions for us:
J: Cortney, Can you tell me about the builder, how did it happen that the company started to build contemporary homes?
C: Identity Construction designs and builds residential contemporary and modern architecture. Our architectural background allows us to collaborate with field conditions in order to achieve the finest design. We manage the entire project with respect to finishes, specialty consultants, budget and schedule. Through this collaboration we strive to produce architecture that is unique and a final product that is beyond expectations of the client.
J: Who orders the homes and where else are located those, that have been built?
C: Though the company as been incorporated since 2004, only a few select contemporary homes have been successful built. There locations include Phoenix, Rio Verde, Scottsdale and Fountain Hills. Most of the business is generated through word of mouth, as their philosophy is the greatest recognition is a successful project. Jason Smith has a background in various building styles, contemporary and modern being his favorite. Clientele ranges, most of them want them to be unique and want their home to be like an original piece of art.
J: What are the most unique features and solutions that you think are the most important about this home?
C: The project on 27th Street was designed around a floating living box set upon a central living that is anchored by concrete mass. The u-shaped masses spoon private places while the store font glazing flood the living with natural light. The cantilevered upper portions of the structure provide protection from the sun in the living area’s as well as insulating the 1600 sq ft. The upper steel portion of the home holds the three bedrooms and was juxtaposed with minimal glazing and increased insulation to buffer the lower section.
_________
Large lot with lap pool, spa and inground tampoline. A garage -located in a separate building has a garage door on both sides, which allows to drive in to the backyard, if needed. Three bedrooms plus a den/office. Wood floors and tile throughout. Large master bath.
This exceptional home can be yours. It is offered for sale at $799,000 ” Get more information about it, including more pictures and full details.
Related Links:
See more about this neighborhood and search for homes there.
Search for homes by Map in Greater Phoenix.
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Home Sales Trends 85020 | East Sunnyslope
July 9th, 2008 categories: Market Trends, Sunnyslope Neighborhood
The Sunnyslope area has not been spared the decreasing prices and is not beyond the trend in the valley. That trend being increased home sales, steady days on the market and lower median home prices. In 85020 which is East Sunnyslope and part North Central Phoenix the median price was $162,750.
Days on the market increased as well after a drop in May.
The distribution of sales between starter homes, move up homes and luxury homes is not much different then the valley but unlike the valley as a whole luxury home sales increased. Its the move up homes which have seen a large decrease in sales. The increase in starter home sales in a very good sign of things to come. It is this market where loans have been more difficult to obtain, so more home selling means that at lease to some extent there is financing out there.
Despite the move up homes still being below the Jumbo loan limits the sales decreased. That limit is $417,000; any loan over $417,000 is a jumbo loan and is subject to higher interest rates.
Below are two graphs for homes built from 1999 onwards in 85020 and grid M34. This is the area associated with the newer home developments near the Phoenix Mountains. The list to sales price ratio has been on a downward trend until March 2008. Since then that ratio has increased but only slightly. I have noticed that prices have come down. This would be a good explanation of higher ratio.
Most of the newer homes in this area are in the luxury home bracket and upper move-up bracket. Since the turnover has not been high enough due to lack of supply the graph below is not a fair representation of the sales.
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