The vibrant community of Moon Valley is a living example of resort living at its finest! It offers elegant homes, a golf and country club, restaurants, award-winning schools, convenient shopping, and much more. Because of its central location, Moon Valley puts residents within a convenient 20-minute drive of downtown Phoenix, Scottsdale, Glendale, and Peoria.
Two miles to the west lies I-17, also known as the Black Canyon Freeway, with access to Prescott, Sedona, and Flagstaff to the north, and downtown Phoenix to the south. Downtown Phoenix is easiest reached by a short drive south on 7th Street.
Here’s a contextual overview of Moon Valley in relation to the Greater Phoenix metroplex:
Moon Valley has A-Rated Schools
Moon Valley is home to several schools that offer high quality education opportunities from preschool through high school. Moon Valley Lookout Mountain Elementary School consistently rates above statewide standardized test score averages and is one of the few public schools in the state to receive a distinguished Great School rating of 8 out 10. Many high school age students matriculate to Thunderbird High School, part of the A-rated Glendale Union High School District.
Moon Valley Country Club and Golf Course
A private golf club with long tradition and rich history, the Moon Valley Country Club has been home to many championship tournaments, notably the Standard Register Ping Tournament, and is where Annika Sorenstam carded the one-and-only 59 in women’s golf. Regardless of their skill level, golfing enthusiasts find the design of the par 72, 18-hole Moon Valley Championship Course beautiful, yet challenging. The country club offers practice facilities and a golf shop. There are also clinics/lessons for juniors and ladies.
Beyond golf, one can also enjoy here games of tennis, racquetball, basketball, volleyball, and swimming. The Fitness Center has everything you need to stay in tiptop shape. In addition to exercise equipment, the Center also offers fitness classes for men and women.
Moon Valley Location and Views!
Moon Valley is the ideal location for people who like to feel free from the hustle and bustle of the city, yet still have quick access to conveniences of modern living. It’s also the perfect location for those who enjoy the peaceful Sonoran desert setting. Surrounded by three mountain preserves – Lookout, Moon, and North mountains – Moon Valley offers homeowners stunning views of soaring mountains. Hiking, mountain biking, and horseback trail riding opportunities abound. The Moon Valley Country Club with its perfectly manicured lawn and excellent landscaping is also a sight to behold.
Moon Valley Shopping and Dining
Consistent with it’s “bedroom community” appeal, Moon Valley offers limited, but high quality, retail and dining options, including banks, grocery stores, dry cleaners, medical and dental providers, and boutiques of various types. Local favorite restaurants include Salute Ristaurante Italiano, Bamboo House Chinese restaurant, and a recent addition to the neighborhood, a trio of restaurants (Aiello’s Salumeria, Isa’s Pizza, and Charr an American Burger Bar) owned by famous couple-chefs Joseph and Myrah Aiello.
Classic Homes, Modern Amenities
Moon Valley home designs range from 1950s architectural style to modern architectural gems. Most of the properties are single family homes, but there are a few condominiums that are perfect for snowbirds. With homes on the Valley floor, as well as the many hillsides, there are options available to suit any prospective Moon Valley home buyer.
Moon Valley Area Homes for Sale
Here’s a map of real time search results pulled directly from the same MLS that I use as a Realtor. It shows all Moon Valley area listings currently for sale. Feel free to modify the search criteria and explore on your own, or call or write me for assistance if you’re in the market for a new Moon Valley home.
I’ve lived in the Moon Valley area since 1995. As a resident expert, I’m happy to answer any questions or comments that you might have about any Moon Valley issues, whether related to real estate or not. Just give me a call at 602-509-7809!
About a week ago, I was driving in Central Phoenix and I saw a Times Square-sized billboard of a happy, smiling Realtor who’s a well known name in the Valley. Next to his portrait, in which he’s fielding an obviously mission-critical phone call with a clipboard tucked under his arm, and yet still managing to give a thumbs-up and toothy-grin for the camera, was a simple phrase:
“What’s your home worth? Call Ted (not his real name) NOW to find out!”
I dismissed the ad and continued my commute.
About 4 blocks later, while stopped at a red light, a bus drove by with a smaller version of the same advertisement plastered on the back.
A few blocks later and there he is, grinning at me from a bus stop poster. Wow. Deja vu.
At this point, I found myself wondering if maybe I was missing the boat on the commuter market and drivers’ apparent fascination with property values. I mean, maybe ramping up my social media visibility was not the right strategy at this time after all.
“Hmmm…,” I thought, “perhaps I should enlist the Ron Paul Revolutionaries to engage in a poster-hanging, sign-pounding, sticker-stickering grassroots campaign to blanket the public streets and sign posts with my brand.”
Commuters would be pummeled on every corner with my messaging, stickers plastered over signs –
“STOP (wondering what your home is worth and call Justin!)” and
“YIELD (to the best comps methodology in the business and call Justin!)” and
“NO U-TURNS (Justin will tell you what you’re home is worth so you can make all the right turns! So call Justin!)”
“ONE WAY (To know what your home is worth — CALL JUSTIN!)”
After a few bizarre Willy-Wonka-esque moments, I realized that, despite commuters’ apparent uncontainable excitement about property values, my blitzkrieg campaign was unlikely to yield sufficient ROI to cover the fines that would be levied against me for defacing public property. I had hit a dead end, so to speak.
Having ruled out vandalism as a marketing strategy, my thoughts shifted away from how to reach an audience of perspective home sellers to the concept of VALUE. Specifically, what do Arizona home sellers want from their Realtor?
Marketing 101 teaches us that one’s marketing message should convey some notion of value to the target audience. Since the majority of Realtor marketing to sellers promotes helping them put a price on their home, one might conclude that home sellers look to their agents primarily for this purpose.
Now, I’m the first to admit that running comps the right way takes experience and a sound methodology. However, I’d argue that ranking it as the number one service of value from your Realtor is like choosing a doctor because they have an accurate scale at their office. (Not that we can choose our doctors anymore.) Yes, knowing and tracking our weight is one factor in understanding our health, but we usually have a rough idea of our weight so a scale that’s a couple of pounds off isn’t going to have much of a difference on our overall experience.
When you visit your doctor, issues like timeliness, education, experience, “bedside manner”, office resources, staff support, and other issues have a much greater impact on the overall quality of care.
The same holds true with Realtors. Are comps important? Of course! But I’ve never met a seller yet who didn’t have at least a “Zillow-rough” idea of what their property was worth. If an agent suggests a value that differs grossly from their own opinion, they’ll know something is wrong. They look to me to help them zero in on the right number that maximizes their sales price because every dollar counts.
However, there are several other facets of the client-agent relationship that can have a greater impact on the overall success or failure of the experience. This is where not all agents are created equally!
Consider a short list of factors that directly affect what I’ll refer to as the “sales experience.” That is to say, the bundle of qualities that include sales price, transaction-related hassle, and potential liability.
Ways Realtors can add value beyond comps analysis:
- Home staging (proactive recommendations to help your property show as well as it can)
- Marketing strategy (how to position the property to target the right buyer)
- Advertising (outlets and reach)
- Quality and completeness of photos, descriptions, measurements
- Ongoing adjustments (based on showing feedback, sales activity updates)
- Accessibility of your agent (Are they there when you need them? Do they return your calls?)
- Negotiating skills of your agent (contract terms, repairs)
- Knowledge of contracts, including when and how to modify to best protect your interests
- Risk management to minimize your present and future liability (disclosures, repairs, insurance, etc)
- Communication “flow” with your agent (current steps, next steps – do you know them?)
- Post-sales support (does your agent disappear after the sale?)
The way these issues are handled can have a much greater impact on the sales experience, including the sales price, than a set of comps that’s a few thousand dollars off target.
Unfortunately, it’s very difficult to gauge in advance how an agent will address these issues.
To find the right agent, whether you’re looking to purchase or sell a property, I recommend the following steps:
- Ask your family, friends, co-workers for recommendations. Gather a short list of 3 – 5 names.
- Visit their websites and search around the Internet to get a feel for their online presence and candid Internet reviews.
- Schedule in-person interviews with those who “make the cut.” Your goal is to learn about the agents’ services and philosophy.
- Ask for references from each agent and call them! Have questions prepared that will give you insight on issues that are important to you.
- Once you find the agent who you feel offers the best mix of services and personality fit, get a commitment in writing of what they promised during your interview(s) so you can hold them accountable.
- You should also insist that the Listing Agreement contain verbiage that allows you to sever the Agreement if the Realtor fails to deliver on what they promised to you.
The concept of “value” in a real estate agent is much easier to appreciate after you’ve had a positive or negative experience. With some due diligence up front, you’ll increase your chances of finding a Realtor that brings maximum value to the table, far beyond a good Comparative Market Analysis.
Very often, I work with buyers who are more focused on specific property characteristics (e.g. square footage, # of rooms, interior upgrades, price, location, etc) than the type of property they purchase. They’d equally entertain a house or a condo with no strong preference either way. This is particularly true of seasonal “snow bird” residents, who tend to have stronger preferences for location.
Any home buyer who’s considering a Phoenix condo should be aware that they require a different set of considerations than a traditional home, patio home, or even townhouse.
For starters, lending guidelines have tightened across the board, but remain particularly strict for condos. The owner 0ccupancy rate, reserve fund balance, dues delinquency rate, etc, all come into play in the underwriting process. The guidelines are so strict that I know of reputable lenders who won’t even take applications for condo purchases.
Compounding the problem is that you’d think you could just call someone at the property management company to determine if a unit qualified for financing, right? Unfortunately, no. Even though I (as a Buyer’s Agent) can do some tax record research to assess the possibility of a condo qualifying for mortgage financing, the actual answer won’t be clear until the lender receives the HOA questionnaire from the property management company. And since some of the variables change monthly, so can a property’s suitability. Even if tax records and the property manager indicate there have been recent financed sales, a change in numbers could cause a property to no longer qualify once the underwriter actually reviews the questionnaire.
And here’s the kicker: The property management company charges fees of $150 and up to put the packet together and send it to the lender, and even more for expedited turnaround. Though almost everything is negotiable, it’s customarily the buyer who pays for the HOA packet.
So a buyer could go through the emotional process of negotiating an offer, arriving at an acceptance, conducting (costly) inspections, making arrangements to move, and then learning late in the process that their condo won’t qualify for financing. Even though the Purchase Contract’s financing contingency calls for a refund of the buyer’s earnest deposit, the fees (emotional and financial) paid up until that point cannot be recovered.
Now, what about cash buyers? Indeed, underwriting guidelines are irrelevant to cash buyers. However, cash buyers and non-cash buyers alike face some due diligence concerns that are especially important with a condo purchase:
- Budgetary and financial health of the community
- HOA fees and what do they cover
- Special assessments?
- Common area maintenance
- Specific CCR and bylaw restrictions (e.g. no rentals allowed or no BBQs on patios)
So if you are in the market for a condo and will be taking out a mortgage on the property, be sure to have a detailed conversation with your lender before you begin your search. That could save you valuable time and effort.
And if you move forward, regardless of the type of financing, ask your real estate agent what specific questions they’d recommend you ask to supplement yours when you call the HOA.
Metro Phoenix home prices are expected to continue climbing during the next few years.
Housing analysts agree that demand for homes in the region is strong, and many don’t appear to be concerned about prices rising too fast and shutting the door on regular homebuyers or investors.
Several experts are looking for metro Phoenix home prices to climb more than 10 percent annually during the next three years.
“We think Phoenix home prices will appreciate 12 percent in 2013, 12 percent in 2014 and 10 percent in 2015,” said national housing analyst John Burns of Los Angeles.
He said the price increases will be driven by “boomerang” buyers who purchase after waiting three years — as required under new credit standards — following a foreclosure or short sale.
“Our major assumption is continued strong economic growth (for Phoenix) and low mortgage rates,” said Burns of John Burns Real Estate Consulting.
The Phoenix area’s median home price has jumped by 35 percent during the past year, boosting the number of sales by homeowners who are not facing foreclosure or a distressed sale. The price gains in recent months have been smaller than earlier this year.
Matt Widdows, CEO of HomeSmart, Arizona’s largest residential-real-estate brokerage, is also bullish on a further rebound in home prices.
“I would say that in the next five to seven years, we will see (home) prices back to levels we saw in 2005,” he said. “Many (Phoenix-area) homes dropped to one-third of their value in 2005, and I have no doubt that we will be right back to those levels.”
These might sound like aggressive forecasts, but even Arizona economist Elliott Pollack, whose forecasts are often conservative, recently projected Phoenix-area home prices would climb 50 percent by 2015-16.
Metro Phoenix’s median home price is currently $150,000, so it would have to increase at least 11 percent annually over the next four years to reach $225,000, a 50 percent increase.
In May 2005, the median existing-home price in metro Phoenix was $228,000.
Other analysts aren’t as bullish.
Mike Orr, an analyst with the W.P. Carey School of Business at Arizona State University, tracks home sales daily but never forecasts home prices more than a month out.
“At the moment, pricing pressure is upwards, but there is always the potential for prices to dip,” he said. His monthly report on prices is due out this week.
An unknown for the housing market is what the handful of large investors who are buying thousands of homes in metro Phoenix plan to do with them.
If they decide to sell around the same time, the supply of homes could jump, dampening prices.
That’s unlikely to happen, at least in the short term, industry experts say.
“We wouldn’t sell now,” said Justin Chang, a principal with one of the biggest residential investors in the country, Los Angeles-based Colony Capital. “We think (Phoenix) home prices will recover more.”
He said the company wants to create a real-estate investment trust next year and put its metro Phoenix rental homes in the trust, then sell shares to individual investors.
Mark Stark, CEO of Prudential Arizona Properties, believes the increase in home prices has slowed and the market has steadied.
“If additional price increases do happen, I feel they will be gradual,” Stark said. “We’re not looking at any dramatic pricing changes.”
Homebuilding in metro Phoenix was a dominant factor in the housing market until the crash. Many buyers once again are opting for new homes so they don’t have to compete in bidding wars for inexpensive existing houses.
New-home building has more than doubled this year, and the price of new houses is climbing.
“We originally forecast 10,000 permits for new homes this year, but we are going to go well past 11,000,” said Greg Burger, co-publisher of the Phoenix Housing Market Letter.
He said he expects the trend of rising new-home prices to continue for the next few years. The median price for a new Phoenix-area home is $222,000.
“Buyers waiting for the bottom of the market missed out months ago,” Orr said.
Source: The Arizona Republic, 10/28/2012
Buying sprees by billion-dollar hedge funds and real-estate investment firms have investors owning nearly 20 percent, or one out of every five, of the region’s single-family houses and condominiums, according to an Arizona Republic analysis of recent sales data.
That’s double the number of rentals considered normal in metro Phoenix in 2000, according to housing-market analysts.
Although it is too soon to gauge the impact of such a large increase in rental properties, the jump in investor-owned properties has the potential to change the character of neighborhoods, influence the options available to other homebuyers and ultimately alter the trajectory of the region’s housing recovery.
Since 2009, deep-pocketed buyers have snapped up tens of thousands of houses in all-cash deals, helping to stanch the bleeding in metro Phoenix’s real-estate market. Their purchases have driven up the region’s median home price 40 percent in the past year and significantly cut the supply of houses for sale.
While real-estate analysts laud investors for buying when others wouldn’t, analysts also express concern about the potential impact of so many buying in such a short time.
In Avondale’s 85323 ZIP code in the West Valley, with many relatively new, affordable homes, 32 percent of the houses are investor-owned rentals. That’s one of the highest rates for single-family homes in metro Phoenix.
In several other West Valley neighborhoods, more than 30 percent of all homes are rentals. About 32 percent of houses and condos in north Glendale ZIP code 85301 are rentals.
But the trend isn’t limited to the West Valley. In the East Valley, 30 percent of all homes in central Mesa’s 85210 ZIP code are owned by investors. And large swaths of the Valley’s core include ZIP codes where 25 percent or more of all residential properties are investor-owned.
Market analysts worry about investors’ impact on traditional buyers, who are finding it extraordinarily difficult this year to close a deal. Sellers, especially those of distressed properties and of homes priced below $150,000, often take the simpler route, accepting bids from investors paying cash instead of from traditional buyers who need to get a mortgage. Bidding wars on the moderately priced houses are the norm, and investors usually win.
What investors plan to do with nearly 225,000 homes they own in metro Phoenix is the multibillion-dollar question. When a handful of major investors, who together have purchased more than 10,000 Phoenix-area homes this year, decide to buy, sell or hold, their decisions will affect the rest of the market. Now, the majority of investors are renovating and renting out the properties. But if the big companies decide to take their profit in five to seven years and move on, real-estate insiders worry that a flood of houses back on the market could send prices spiraling down again.
“Investors helped stabilize Phoenix’s housing market,” said Mark Stapp, director of real-estate development for Arizona State University’s W.P. Carey School of Business. “My concerns are that too many investors are treating Phoenix’s homes as a commodity, and not the area as a community.”
Investors have purchased more than 30 percent of all single-family houses and condominiums sold this year, and their purchases have grown to an even bigger percentage of all sales in the past few months.
The type of investor has shifted dramatically this year, from small and large local investors to billion-dollar funds based in New York and Los Angeles. A Republic analysis of purchases, provided by real-estate data firm Information Market, found that in some areas of metro Phoenix, the most active three or four investors own more than half of the rentals.
The most prolific homebuyers are New York-based Blackstone Real Estate, Los Angeles-based Colony Capital and Scottsdale-based American Residential Properties. Those groups alone have purchased more than 3,000 houses in the area so far this year.
Local investor and real-estate agent Julie Bieganski is selling a 2,000-square-foot south Phoenix house for $82,000. The day the house went on the market in early October, a real-estate agent representing Tempe-based Treehouse Group made her a full-cash offer to buy the house “as is” for cash and close within 30 days. Treehouse is buying homes for Blackstone and other investors.
“According to the contract, the buyer has purchased 1,400 houses in Maricopa County in the past 90 days and plans to own the home and rent it out for five to seven years,” she said.
The investor-buying frenzy in metro Phoenix began with smaller investors like Bieganski with the cash to pick up a couple of houses as foreclosures peaked more than two years ago. With auctions running all day in front of the Maricopa County Courthouse, large out-of-state buyers’ interest in the market grew. As foreclosures slowed, many of these investors turned to short sales. But those deals must be lender-approved and take longer to close. Now, the biggest and richest of the investors have stepped in, often purchasing foreclosure houses previously bought by those earlier investors. Still bullish on the Phoenix market even as prices rise, these big investors sometimes buy one home at a time — and often 50 to 100 homes at once.
Investors now own 225,000 homes, the same number of all homes typically found in a city the size of Glendale. Their profit-focused strategy is a key issue for everyone else with a stake in the housing market.
Because of the high demand for rental homes and relatively low prices to buy, most are making 5 to 10 percent annual returns on houses by leasing them to tenants. But investors don’t hold on to properties forever, and those that control hundreds or thousands of properties can have outsize impact. If too many big property-holders try to sell at the same time, it could lead to another drop in Valley home prices.
Large investors are guarded about strategies. Publicly traded companies such as Blackstone can’t talk about future plans because that violates shareholders’ rights. Many of the latest investors in the Phoenix market want to become publicly traded real-estate investment trusts to attract smaller investors looking to grab a stake in real estate.
Colony said it plans to keep most of its metro Phoenix homes as rentals for five to seven years. The company is planning to go public next year. “We started looking at investing in housing a year ago. There’s a real opportunity to renovate homes and lease them to people who need them,” said Justin Chang, principal of Colony Capital and acting CEO of Colony American Homes. “We like what we have bought in Phoenix and the value there.”
American Residential also has a long-term buy and hold strategy. “We are not in business to flip real estate. American Residential hasn’t sold one of the 1,000 houses it has purchased in Phoenix since 2008,” said Steve Schmitz, CEO and founder of the firm. “We are in the business of providing nice, clean housing to families.”
Mike Orr, who analyzes real-estate information for ASU’s W.P. Carey School of Business, is another market analyst with concerns about the investor influx. “We don’t know their plans. They don’t want their competitors to know their plans. But they clearly have a lot of money to spend.”
The rental market
In Avondale ZIP code 85323, Liz Moad, who said she has owned her home there for three years, pointed across the street and said, “This house has had four families move in and out in the last two years.”
Empty houses that had been foreclosed on and auctioned are now rentals, said Chris Sammons, who said he has owned his home there for five years.
“Definitely you don’t want to see them just sitting there empty,” Sammons said.
“Probably within the last month there’s been half a dozen different houses where the ‘for rent’ signs have come up.”
“I think eventually when the economy picks up more, you are going to have more people that will take the next step to actually owning their own home,” he said.
Renter demand so far has kept up with the number of investor-home purchases in metro Phoenix, mostly because there are now more potential tenants. In addition to the typical renter who can’t afford to purchase a home, and newcomers moving to Arizona from out of state, former homeowners who lost houses to foreclosure must rent to rebuild their credit. Then there are the prospective homebuyers who are getting outbid by investors. Finally, there is a new group of people who can afford to buy but choose to rent.
A record 3,500 leases a month for rental homes in the Valley were signed in June, July and August, according to the Arizona Regional Multiple Listing Service. Houses in the best locations often draw competing offers.
“We were astounded by the rental market here,” said Mara Lewis, who relocated to Phoenix from Wisconsin. “Not only the up-front fees, and the methods by which they had to be paid (cashier’s checks), but the rules for what a (rental) house has to have here is very lax. We had to purchase our own washer and dryer.”
She and her husband own rental properties in Wisconsin and chose to rent here instead of buying. Lewis leased through a real-estate agency and isn’t sure who owns the house.
Jennifer Taylor said she moved out of a north Phoenix condominium because most of the units in the building were owned by different investors, and the maintenance varied by condo, as did the type of tenant. “The neighbors were messy, and I always had my stuff vandalized,” said Taylor, who recently moved to a central Phoenix condo. “Now I know my landlord, and the issues I had since moving in were all fixed that same week.”
Forecast for future
Before the boom, investors owned 8 to 10 percent of metro Phoenix’s houses. The current rate of 18.2 percent is double that. The shift is so new that it’s difficult to predict what might happen.
Stapp said, “A valid concern is whether people will want to buy homes in neighborhoods where there are the most rentals. We don’t know yet.”
But market analysts offer some scenarios.
The best-case scenario is for investors to hold onto houses for at least a few years and slowly sell to regular buyers before home prices soar. It wouldn’t have too large of a negative impact on the market if one major investor sold all of its homes as long as other major investors continued to hold on and lease out their properties until the supply of houses stabilizes again, market analysts said. Then there’s the worst-case scenario: Home prices continue to climb, and all of the major investors want to lock in their return and try to sell at once.
“It was good when all of the investors came into metro Phoenix and bought when no one else was buying,” said Orr, an early investor himself. “But it might be time for investors to take a rest, and let regular buyers have a chance.”
Source: Arizona Republic. Includes information from data reporter Matthew Dempsey and 12 News reporter Melissa Blasius.
The housing market continues to gather strength, and the biggest gains in price now appear to be among the least expensive homes, whose values fell the most in the downturn and have weighed against any would-be recovery.
Over all, the Standard & Poor’s Case-Shiller index showed an annual gain of 1.2 percent in the price of single-family homes across 20 cities in July, according to data released Tuesday. In addition, all 20 cities showed price increases from the previous month, the third monthly gain in a row, supporting the idea that the nation’s housing market has bottomed out and, some analysts said, contributing to an unexpected bump in consumer confidence.
Luxury homes lost less value in the housing crisis and began to rebound more quickly, but lower-price homes are catching up, rising slightly faster in value than homes in the middle and upper tiers, according to an analysis of the Case-Shiller data by Patrick Newport and Michelle Valverde of IHS Global Insight, a private research firm in Lexington, Mass.
The typical lower-price home rose at an annualized rate of 1 percent from June to July on a seasonally adjusted basis. The middle tier posted a one-month gain of 0.4 percent, and the highest tier inched up by 0.1 percent.
In the last three months, Mr. Newport said, the lowest tier has been rising in value more than twice as fast as the other two categories. For the least expensive homes, “prices just shot up too fast on the way up and then went down more sharply,” he said. “We’re seeing the correction from that.”
The price cutoffs for each tier vary widely depending on the city. The cutoff for the lowest tier ranges from $86,000 in Atlanta to $349,000 in San Francisco.
Other data supports the trend. According to a report from Zillow, a real estate Web site that divides homes into three price groups, the gap in price changes between the top and the bottom of the market is narrowing. “It’s less that the top tier is cooling than that the bottom tier is strengthening,” said Stan Humphries, chief economist at Zillow. “The bulk of the recovery is due to the changes in the bottom and middle tiers.”
Even in Las Vegas, where housing prices are still slightly down over the last year, lower-end homes have ticked up in value, which may be good news for sellers but can be a hurdle for buyers. Mark Graham, a youth pastor who has been looking for a house for his family there for months, said buying a home for less than $150,000 could be a challenge.
“Houses are going on the market and within a day have multiple offers already on them,” Mr. Graham said, adding that most of the offers were from investors who did not need financing. “It’s more or less a heartbreaking market, because you get your heart set on a house, and then someone walks in with cash.”
Not every market is showing improvement on the low end, according to Case-Shiller. Atlanta and Chicago are still lagging, but in places like Boston and San Diego, the bottom third of houses are doing better.
“The majority of the cities have been more like Boston and San Diego,” said Maureen Maitland, a vice president at S.& P. Dow Jones Indexes, which produces the Case-Shiller index.
In Phoenix, which has shown the strongest recovery in housing prices of the 20 cities surveyed, the lowest third — homes under $127,000 — gained 33.5 percent from July 2011 to July 2012, while the top tier — homes above $211,000 — posted an 11.5 percent increase in that period.
Prices have been bolstered by a decline in the number of foreclosure sales and strong interest from investors, who are buying low-price properties and converting them to rentals.
In the Sarasota, Fla., area, investor demand has driven up prices for lower-end homes, said Roxanne Moore, a real estate agent with Green Lion Realty there.
“Investors are finding properties that they used to be able to buy for $80,000 or $90,000 are now going for $100,000,” she said. In addition, after a long absence, first-time home buyers are beginning to trickle back in.
Over all, home values in the first seven months of the year rose 5.9 percent, the best year-to-date performance in seven years. Nevertheless, the broad housing market is still nearly 30 percent below its high in 2006.
In four cities — Atlanta, Chicago, Las Vegas and New York — prices are lower than they were a year ago. In New York, including the surrounding suburbs, prices increased 1.2 percent from June to July, but remain 2.6 percent lower than they were in July 2011. Prices at the low end of the market — houses below $271,000 — have dropped 3.9 percent in the last year, while high-end homes — $437,000 or more — have dropped 2.5 percent.
But in an optimistic sign, consumer confidence rose in September to its highest level since February, according to a report released Tuesday by the Conference Board, a private group.
The consumer confidence index reached 70.3 points, well above economists’ expectations of 63 and a significant improvement from the upwardly revised level of 61.3 in August. Some analysts attributed the bump to gains in the stock market, while others credited the improved outlook for housing.
Source: New York Times
This article from FoxNews.com highlights one of the main attractions to the Greater Phoenix area real estate market — even as our supply dwindles, prices remain low relative to “the boom years” of the mid-2000’s. For those who qualify for financing, interest rates remain close to all-time lows. Neither of these dynamics will last forever.
Here’s the article:
It’s hard to make any firm categorical statements about today’s economy, but recent data and anecdotal evidence suggests that the battered housing market is finally on the rebound.
Homeowners, if they’re still fortunate to own a home through the past few years, have endured precipitous drops in valuation, and many still have homes that are worth less than what is owed to the bank. Nonetheless, in places across the country there’s evidence that prices are on the rise.
Analysts report that historically low interests rates, foreign investors and natural market forces are driving home prices back up. This week’s report by S&P/Case-Shiller showing prices in the nation’s largest metropolitan areas up by 2.2 percent gives credence to the sense that at least in some places the housing market is on an upward trend.
After delaying her retirement by a year because of the economy, Sheri Gingerich is now a new homeowner in one of the hottest places in the country–Phoenix. The housing market there is heating up, too.
“To find [a home] on a golf course that was affordable compared to five years ago was to me astronomically the exact thing that worked out to our benefit,” Gingerich said while taking a break from moving into her new home outside Phoenix. The Minnesota native paid $240,000 for the home far enough from the fairway–she hopes–not to attract wayward golf balls. She says the house would have cost considerably more a few years ago and that she wouldn’t have been able to afford it then. But now, the perfect retirement home fits perfectly into her budget.
Gingerich’s realtor says business really picked up at the start of the year and has kept on going strong even into the usually slow summer months. “Oh my God, it’s just been a really great experience the last couple of months with people coming in and really feeling like this is the time to buy,” Kathleen McMullen said. “So I think [buyers] attitudes are all upbeat and I think the economy is taking a shift and Phoenix is really coming back–bouncing back quickly.”
McMullen’s data shows homes that once were on the market for nearly a year are now selling in a month or two and that Gingerich is part of a trend. “Right now, the good news is, in the Phoenix area — all the cities around Phoenix — all of the home values have increased up to 3 percent. And in other places [too]. So, this is not a unique experience at all.”
The chief economist for the National Association of Realtors says while Phoenix may be a hotter market than other places it’s not too far out of line from the national picture. “The market is showing improving signs,” Lawrence Yun recently told Fox News. “We have seen the home sales rise roughly 10 percent higher this year compared to last year. And it looks to close out the year at a five-year high. So we are beginning to see a much improved condition after some tough years in the prior years.”
Yun attributes the rise in prices to an influx of buyers from overseas or investors with lots of cash who are able to buy homes as investments. Nonetheless, he added, “the first time buyer still comprise about one-third of the market. So you are seeing a very broad-based recovery. Everything from New England, Florida, middle America to the Western coast, the sales are improving.”
As for the rest of the year, Yun predicts a modest increase in home prices and bases that on historical trends of supply and demand about inventory.
“Historically, the supply and demand balance has been about a six month supply of inventory. Now in the past few years it’s been in the double digit months of inventory so there are too many sellers in relation to the buyers. Now the market is roughly in balance and historically when that is the case home values rise roughly three to five percent annually.”
This article from CBS News discusses the fact that the Phoenix real estate market is serving as a “beacon of hope” for other housing markets that were crushed by the real estate bubble. Much of the success of the Arizona housing market in rebounding so quickly is being credited to the streamlined non-judicial foreclosure process, which has helped the inventory absorption rate.
Here’s the article:
PHOENIX — The Phoenix metro housing market is seeing a rise in home prices and a decline in the number of houses on the market, putting the area ahead of most other U.S. cities on the road to recovery, according to real estate experts.
Economists say the upward trend in the Phoenix area may serve as a beacon of hope for other cities across the nation that suffered when the housing bubble burst.
“The Phoenix market will be a benchmark city to monitor for residents in Las Vegas, the Inland Empire of California and … the Florida market,” said Lawrence Yun, chief economist with the National Association of Realtors.
The median price for Phoenix-area homes in May was about 30 percent higher than it was the same time last year, according to a monthly report released by the W. P. Carey School of Business’s Center for Real Estate Theory and Practice at Arizona State University. The report also shows there are about half as many houses on the market as there were the same time last year.
The Phoenix area market was one of the hardest hit in the nation in terms of distressed properties, but the state’s foreclosure system allows it to work through the backlog more quickly than states in which foreclosures have to go through the judicial process. Banks and mortgage companies have the power in Arizona to foreclose homes without a judge’s approval.
Nevada’s foreclosure system is largely the same. Nasser Daneshvary, director of University of Nevada, Las Vegas’s Lied Institute for Real Estate Studies, said speedy foreclosures are healthy for the market. Too many foreclosures can sink home prices, as happened in both Phoenix and Las Vegas, but Daneshvary said a return to the depths experienced during the housing collapse isn’t likely in either city.
Arizona’s job market, with an unemployment rate that’s down to 8.2 percent from its March 2010 peak of 10.8 percent, is also a factor in real estate improvements. Yun said other areas that have sluggish job markets are likely to see slower real estate recoveries, with fewer people able to buy homes.
Michael Orr, director of the Center for Real Estate Theory and Practice at ASU’s Carey school, said dwindling housing inventory, coupled with prices that are still relatively low, means sellers now hold the power in the Phoenix-area market, and receive multiple offers, many of which come from investors who are looking to buy and rent out houses.
“Now we’ve got too few homes. Everybody’s wishing the investors would go away and stop buying, but the investors are still here buying everything they can with cash, which makes it pretty difficult for ordinary home buyers to compete,” Orr said.
Sandy and Luis Solis said they found that to be true. The couple, who moved from Los Angeles to Scottsdale last year, said the rapid decline in homes available in their price range made them feel hurried to buy. They made offers on three homes but were outbid by cash offers twice, the second time by an investor. They’re in the final stages of closing on a house in Phoenix.
“We were kind of losing hope that we were going to find the right home for us,” Sandy Solis said.
Las Vegas and some cities in California are seeing similar situations. Daneshvary said investors who buy housing for the purpose of renting are better for the market than others in the past who have purchased houses just to flip them. He said by the time investors stop buying, the market will be healthy enough to remain stable.
With houses in short supply, the construction industry will step in to fill the void. Orr said home building in the Phoenix area is slowly beginning to pick up, but it will likely be stifled by a shortage of construction workers in the state. He said Arizona has lost “80 to 90 percent of that skilled workforce” in the last six or seven years because workers have gone elsewhere or left the industry altogether.
Orr said the Phoenix-area’s home market recovery will likely level out over the next few months.
“I just don’t want people to think the next quarter is going to accelerate at the same rate,” Orr said. “That’s not likely to happen.”
That, Yun said, is a sign that the market will recover in a more healthy way.
In the long term, some city’s housing markets may end up in better shape than they were before the housing market crash. Yun said parts of Texas, Oklahoma, Nebraska and the Dakotas didn’t experience huge housing market losses but are benefiting from widespread improvements in economies.
Competitive Phoenix Real Estate Market Inspires Insanity
As more and more local property owners clue in to the state of today’s frenzied market, we’re starting to see some of the crazy cockiness that sellers exhibited in the mid-2000’s during the height of the boom.
Yes, our market is looking better for sellers than it has for 6-7 years, but I’m not yet convinced that some of today’s tactics are justified…if they ever are.
Here are some of my ‘favorites,’ if you can call them that.
“We’re not considering any offers that are less than asking price.”
Yep, I recently showed a property in Chandler where the Listing Agents had been instructed by their seller to not even present any offers below asking price…which was 20% over market value. I’ve been around the block. I understand that there are opportunists who are willing to try and capitalize on extreme market conditions. However, this was short-sighted. After years of negative media, excessive inventory, and fire sales, most Phoenix real estate buyers aren’t yet accustomed to the idea that they can’t at least negotiate a few thousand dollars off the asking price. Even the savviest of buyers who are in tune with today’s aggressive conditions aren’t prepared to pay 20% over market value. As for the sellers, if they want 20% over fair market value, that’s completely their prerogative. However, they should ask 21% over market value so they can at least give the appearance of negotiating.
“Buyers Must Waive All Contingencies in the Contract After 15 Days”
This is a flashback to the “good ol’ days” that I’ve even used myself. Unfortunately, today’s market is different than even that of 6-7 years ago. Lending guidelines have become tighter and HOAs are less cooperative than ever with delivering docs in the contractual timeline…among other issues. In short, my job as a Buyer’s Agent is to advise my clients of the risks of accepting this condition. It’s up to them to determine whether or not the potential reward is worth the risk. Personally, I wouldn’t do it today because too many things can go sideways in a transaction that one can’t foresee or prevent.
“Showings only at 2pm on Tuesdays and Thursdays”
Seriously. I called a Listing Agent today to confirm availability on a property and she said her clients only allow showings on Tuesdays and Thursdays at 2pm. Not 1:45. Not 2:30. 2pm. I explained to her that my clients were only in town on Friday, Saturday, and Sunday and were going to make a decision while they’re here. Too bad, she said. Wow! If she was advocating her client’s interests, she would have called them and explained the extenuating circumstances and allowed them to decide whether or not to allow the showing.
As Phoenix real estate continues to sell at a torrid pace, I expect to see more unique terms and conditions from sellers that show they’ve indeed gotten their cocky back
Tips for Phoenix Home Sellers – Part 2
A few postings ago, I offered a list of ideas that Phoenix real estate owners can do to attract more buyers and faster, higher offers.
This is the continuation of that posting, which was born from an article I read about was to turn off homebuyers, which you can read here. While I definitely agree with the list, I have several other ideas and additional commentary to add to the mix. It never ceases to amaze me that, as broadly-covered as this topic has been, so many Phoenix and Scottsdale property owners fail to capitalize on these easy-to-accomplish tips.
To recap, here are the previous tips:
Tip #1: A Clean Home is a Happy Home
Tip #2: Eliminate Odors and Freshen Up!
Tip #3: Update Any Dated Fixtures
Tip #4: Neutralize Wall Coverings
Now let’s get to the next batch of suggestions…
Tip #5: Say “Goodbye!” to Popcorn Ceilings
There is a time and a place for popcorn (acoustic material) ceilings. Unfortunately, it was in 1975. And for the many, many homes that have been slathered in this most unfortunate of finishes, it’s time to consider a good stripping!
You see, not only is the material unsightly and dated looking, it’s porous and highly absorbent. There’s no better way to absorb and preserve off-putting odors than popcorn ceilings. And we know that foul odors are a no-no! (see Tip #2) So to bring your home into the 21st Century and enhance it’s fresh appeal, remove the popcorn!
It’s very important to be aware, however, that your popcorn ceiling material may contain asbestos, a known carcinogen. In fact, anyone engaging in removal should assume it does and take necessary precautions to avoid risky exposure.
Tip #6: Depersonalize
One of your many main goals when staging your Phoenix real estate to sell is to try and present an environment in which prospective Phoenix home buyers can easily imagine living. The more personalized the environment, the more challenging it becomes to do that.
While you might be tempted to think that this tip only pertains to your award-winning, 67 unit Snow-Baby collection that’s proudly displayed in your living room, that’s just part of the story. Yes, put the Snow Babies on ice, but also remove family photos, diplomas, awards, ‘unique’ artwork and furniture, and anything else that brands the home as “YOU”.
Besides conflicting with your goal of helping the buyers imagine the property as theirs, personal effects can also be distracting. “Oh, honey, look!” (Prospective buyer points to diploma on the wall) “He went to ASU, too! I wonder if we know him? Look, there are some photos over there…let’s take a look to see if we recognize him…” Don’t laugh. It happens. A lot.
Tip #7: Leave Already!!
Another goal of any Phoenix home seller is to do what you can to get buyers talking about your home while they’re at the property. I emphasize while they’re at the property because by the end of a long day of looking at homes, they’ll forget a lot of the details of yours.
What does this mean for you? Do your best to leave your home when it is being shown. That encourages home buyers and their agents to discuss the property freely — the pros and the cons — while they’re onsite. Dialogue gets proverbial ‘juices flowing’ and ensures your home has the opportunity to shine while it’s in the spotlight.
Tip #8: Don’t Misrepresent
In real estate, I think of misrepresentation as being closely tied to disclosure. There can be a fine line between showing your home in the most positive light and actually taking proactive steps to hide negatives. The former is encouraged, while the latter can get you in big legal trouble!
Licensed real estate agents consistently have the message, “Disclose! Disclose! Disclose!” driven into their heads. The message is conveyed to us, among other ways, in continuing education, from various associations and groups that we belong to, from the Department of Real Estate, the contracts and forms that we use, and from legal verdicts.
A good REALTOR will advise their clients to disclose anything and everything that could be of potential material importance to a prospective home buyer. In fact, your agent is obligated to disclose any issues that they’re aware of, even if you instruct them not to. You authorize them to do as much in the Listing Agreement. But that’s another posting for another day…
Back on topic. If you know there’s a carpet stain in the living room that you’ve unsuccessfully tried to remove, then don’t you think it’s reasonable that a home buyer might want to know they’ll need to budget for carpet replacement? Because of the potential financial impact on the home buyer, it’s a material fact. If you intentionally cover the stain with an area rug and fail to disclose it in writing to the buyers, you’re asking for problems after the sale when the buyers realize they’ve been tricked.
Here’s what I recommend to my Phoenix real estate clients: By all means, enhance the cosmetic appearance of old repairs and do an additional repairs that financially make sense.
That old water stain in the garage ceiling from 8 years ago…the one that signaled it was time for a new roof, but that you never got around to painting over after the roof was replaced? Paint over it! Then disclose it to the buyers when you receive an offer.
The toilet in the master bedroom that runs constantly? Fix it! Then disclose it.
The baseboard under the vanity in the bathroom that swelled like a balloon when you had that leak last year? Replace it! Then disclose it.
See the common theme? You can repair and enhance your home, but you need to disclose the issues so the buyer has an opportunity to do their due diligence, such as hiring a roofer to confirm the roof was properly installed or hiring a plumber to confirm the pipes were re-connected properly.
Tip #9: Curb Appeal Matters
I like to say that the key to a successful Phoenix real estate sale begins at the curb. Others say that “you only get one chance to make a first impression.” Regardless of the credo, the fact remains the same: To sell your Phoenix property, you should create the best possible experience from the front of the property through to the back yard.
Pull weeds, rake up leaves, sweep gravel off the sidewalk, keep the lawn green and neatly trimmed, ditto for shrubs, replace dead plants, add some colorful flowers and a new welcome mat at the front door. You want home buyers to say, “WOW!” before they ever set foot inside your home. A little attention to your front yard will go a long way in accomplishing this goal.
Tip #10: Declutter
This tip really goes hand-in-hand with Tip #6 (Depersonalize). If, like many homeowners, you’ve outgrown your current home and are bulging at the seams with overflowing closets and a disaster of a garage, then consider renting a storage locker on a month-to-month basis. Remove everything you can live without, within reason. You can leave your coffeemaker and toaster oven on the countertops in the kitchen, but remove the gelato machine, food dehydrator, and baby food maker that you haven’t used in 6 months.
Eighteen sets of towels? Store ’em away.
Extra china settings packed in the pantry? Store ’em away.
Tools, boxes, and equipment in the garage that you forgot even existed? Store it away.
Winter snow gear in your closet and it’s June? Store it away.
Do your best to create the appearance of space everywhere you can: closets, counter tops, drawers, cabinets, and shelves.
Tips #11 and Beyond: Staging Tips and MLS Success
There are a number of other recommendations that I can make to help sell your Phoenix real estate that weren’t covered in the original article. The first tips relate to staging your home.
In keeping with the notion of encouraging prospective buyers to stay in your home as long as possible and creating a pleasant environment, consider the following:
- Remove pets from the property, especially noisy ones.
- Leave the thermostat at a comfortable level (even if your home is vacant!): Nobody will spend long in a Phoenix house in July if the AC is off!
- If you know there’s going to be a showing: turn on all lights and ceiling fans, open up window coverings to let light in, light a few aromatic candles and/or spritz some unoffensive air freshener, and turn on some soothing music when you know your home is going to be shown. Even though everyone will know it’s a contrived staging, it will work.
Finally, let’s talk about the most important piece of staging your real estate for sale: your property’s listing sheet. The listing sheet is your home’s face to the world. Not only is it used to attract real estate agents to your property, but many people don’t realize that the MLS information (including photos) are automatically distributed to affiliate websites through IDX agreements. So the way your home appears in the MLS is also how it will appear on Realtor.com and Zillow, among hundreds of others. Prospective buyers will see your listing sheet.
I’ll cover these in detail in an upcoming blog post, but here are some tips for a successful MLS listing:
- Lots of photos and compelling photos (optimized, if possible, and taken AFTER improvements to property, if any)
- Virtual tour
- Accurate directions
- Accurate mapping in the MLS system
- Room measurements
- Compelling verbiage
- Complete and accurate accounting of all features
- Avoidance of verbiage that makes you appear to be difficult to work with
- Disclosure of any terms that might be material prior to showing (e.g. “In the process of painting, to be completed by Friday.”)
Phoenix real estate is a tough business in any market. Indeed, even in the strongest of seller’s markets there steps that any home seller can take to get top dollar offers and help their home stand out from the crowd. Sure, it’s possible to not follow a single tip that I’ve listed and still sell your home for asking price on the very first day it’s listed. However, following the tips here might put thousands of dollars more in your pocket, and what seller wants to leave equity on the table?