July 2020 Market Frenzy

Metro Phoenix Valley Experiencing a Market Frenzy in July – for the average priced home buyer anyway

Data and excerpts from The Cromford Report, Arizona’s most respected source, July 24, 2020

For Buyers

July 8 2020: 1.4 Million Homes and less than 8,600 Listings

Greater Phoenix has a population of approximately 4.8 million people and 1.4 million residences total. As of July 8th, only 8,579 were listed on the local MLS. Greater Phoenix has 30,000 to 35,000 listings in a “normal market.”

New listings in June compared to same time last year overall were down 7.8% (down 22% for homes under $300,000 – which has reached 38% to date in July) while contracts in escrow were 24% higher.

Finding your new home under $300,000 is nearly impossible

If those numbers doesn’t cause you to gasp, then this might: only 1,023 of the 7,700 active listings are single family homes under $300,000, and that number is diminishing every day. The last month has seen a surge of buyer activity, but it was not met with an equivalent surge of new listings. For buyers under $300K, new listings were down 22% in June compared to last year, and are down 38% so far in July. This is causing quite a bit of buyer competition for move-in ready homes in this price range.

New Home Construction

For buyers over $300K, the new home construction adds additional inventory and is providing some much needed alternatives. The top 3 cities for single family home permits are Phoenix, Mesa and Buckeye. Notable spikes in building permits issued can be found in Surprise, Maricopa and Queen Creek. Most new homes are selling between $300K-$500K, but buyers looking for a brand new single family home under $300K still have some options. Their best bet is in Pinal County or Buckeye with average sizes between 1,800-2,000 square feet for their budget.

Homes over $500,000 are strong, but nowhere near the frenzy

Conversely, new listings over $500K saw a spike last month, up 20% over last year. 1,596 new listing came on the market and 2,046 contracts were accepted in this price range in June.

For Sellers

Brace yourselves. Half of the sellers who accepted contracts under $400K in the first week of July were on the market for just 8 days or less with their agent prior to contract acceptance. Sellers who took contracts between $400K-$600K had a median of 14 days on the market with their agent. Sellers who landed contracts between $600K-$1M had a median of 41 days. It’s a good time to be a seller.

Sellers Getting Over List Price

While 28% of all sales in July so far have closed over asking price, that percentage peaks at 41% for those between $200K-$300K. Top cities for closings over asking price are Tolleson, Avondale, Glendale, Gilbert and Youngtown. Gilbert is the only city in that list with a median sale price over $300K. Seller-assisted closing costs remain popular and were involved in 23% of all sales in the first week of July. That percentage increases to 33% on transactions closed between $150K-$300K. Top areas where 50%-60% of sales involved seller accepted closing cost assistance were Youngtown, West Phoenix, Aguila, Glendale, and Tolleson. This supports the theory that sellers receiving offers over asking price in the West Valley and other affordable areas are still open to accepting closing cost assistance if a contract meets their most important needs.

See the charts and graphs supporting this month’s market report here.

Provided as a proud subscriber of the Cromford Report

About the Author: Denise van den Bossche has been a licensed Agent and homeowner for over 35 years in the Metro-Phoenix Scottsdale Valley of the Sun. A Legacy LEED® AP, designated SRES, DMX, ePro, EcoBroker and co-founder of Seniors Advisors Advising Seniors®, a consortium of experts to surround and support families facing aging or chronic illness. To request a no-obligation market report, home evaluation, or consumer guide on your specific needs, contact Denise at 602.980.0737 or email  Denise@AZMultipleListingService.com.  Denise’s husband Patrick is President of Realty Executives International, with 500 offices throughout North America.

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Homes for sale in the best Family Friendly neighborhood in Paradise Valley AZ

Homes for Sale in the BEST FAMILY FRIENDLY Paradise Valley AZ neighborhood

Best Family Friendly Neighborhood in Paradise Valley AZ - Denise van den Bossche, Realtor

Why Do People Live Here?

5,880 square foot 4 bedroom, 4 bath on over an acre sits at the 13 – 14th hole turn of the Ambiente Golf Course of the Camelback Country Club. (site)

Welcome to Paradise Valley Arizona’s best family friendly neighborhood. Camelback Country Club estates is located just 15 minutes from Phoenix Sky Harbor International Airport, in a Town frequently recognized for celebrities, luxury estates and gated compounds. But, here surrounding Paradise Valley’s two most recognized golf courses, lies a front porch community anchored by some of the nation’s top public schools, wide shady streets, sidewalks, and bustling with activity. You will find this to be the BEST FAMILY FRIENDLY neighborhood in the entire Scottsdale – Phoenix Valley.

Coming August 2020: 9390north57thStreet

Looking for a home in Paradise Valley’s friendliest neighborhood?   

Interested in finding homes in the best family friendly neighborhoods of Paradise Valley?  Homes for sale in the friendliest neighborhoods of Paradise Valley.  Click this link to find all the currently available homes in this area of Paradise Valley.

What are homes in the Neighborhood Like?

Homes in the neighborhood sit on 1 acre minimum lots, starting from around $2,000,000. People love Paradise Valley for its wide range of architectural styles on large lots, in contrast to a tract community. Most homes are not in a Homeowners Association (HOA). However, pride of ownership is demonstrated, as home values here are in the top 10% of the Metro Phoenix valley. Property taxes are kept low thanks to a handful of the most exclusive resorts in the State. Dirt Lots start around $1 Million, and you can sometimes pick up an original ranch style home for around $800,000 for demo, and there are new homes available.

What Else is Special about the Neighborhood?

Clever walkways and a bike path connect the community. Lots of open space between homes provide views of nearby Mummy & Camelback Mountains, indigenous vegetation and the lush green grass of the golf courses. Located in the foothills, outdoor enthusiasts enjoy walking , jogging and bicycling for miles on routes that can include both flat and impressive inclines. Ride or run to Camelback Inn or Paradise Valley Country Club without crossing a major street. The neighborhood is within 5 miles of some of the most popular grocery stores, coffee shops, restaurants, wine bars, fitness clubs, salons and boutique shopping. This neighborhood attracts a large demographic of younger families and empty-nesters relocating to Maricopa County.  Find out about everything that is nearby to this family friendly neighborhood of Paradise Valley including places of worship, banking, shopping, Attractions and recreation and much more on my website. 

Why Live In Paradise Valley AZ Township?

Paradise Valley tops the list for safest and wealthiest city in Arizona where estates can exceed $20 Million.  Paradise Valley  is most widely known for its celebrities, athletes and seasonal home owners seeking privacy and seclusion, within close proximity to the heart of Scottsdale and downtown Phoenix. More on buying in Paradise Valley Arizona .

What Schools will the Kids Attend?

Scottsdale’s world renown 3-C Schools are located here. How many elementary schools can boast of a local police presence? Welcome to Cherokee Elementary School where the PV Police Department maintains a substation. Don’t be surprised to find an officer playing “hoops” or eating lunch with students. Cherokee has historically enjoyed some of the longest wait lists in the state, with a new campus expected to be complete by March 2021. Located here in Camelback Country Estates in an amazing neighborhood, the school has a breathtaking Mountain backdrop. Nearby Chaparral High School has a well recognized athletic program, attracting students from around the nation. In addition, there are multiple top private schools located in close proximity to the neighborhood.

Now You Really Want to Find a Home Here, Right? 

If you are Interested in the current Homes for sale in the friendliest neighborhoods of Paradise Valley click on the link. Our ‘for sale’ property information is a direct feed from the Northwest MLS and is updated continuously throughout the day.  SEE AN AERIAL TOUR OF THE CAMELBACK COUNTRY CLUB GOLF COURSE HOME VIEWS HERE!!

SNEAK PREVIEW OF NEW GOLF COURSE HOME COMING AUGUST 2020 click on the link.

Questions?

About the Author: Denise van den Bossche has been a licensed Agent and homeowner for over 35 years in Paradise Valley Arizona. She and her husband Patrick have lived near the Camelback Country Club for over 2 decades. A Legacy LEED® AP, designated SRES, DMX, ePro, EcoBroker and co-founder of Seniors Advisors Advising Seniors®, a consortium of experts to surround and support families facing aging or chronic illness. To request a no-obligation market report, home evaluation, or consumer guide on your specific needs, contact Denise at 602.980.0737 or email  Denise@AZMultipleListingService.com.  Denise’s husband Patrick is President of Realty Executives International, with 500 offices throughout North America.

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Vacation Rentals in a Post-COVID-19 World

Vacation Rentals May Greatly Benefit from COVID

Tempe Town Lake Fireworks
Tempe Town Lake Fireworks

Vacation Rental owners in Scottsdale Arizona are cashing in this summer. July bookings of vacation rentals may be at an all time high. “Airbnb saw more nights booked for U.S. listings between May 17 and June 3 than the same period in 2019, and a similar boost in domestic travel globally,” according to Bloomberg June 7. This contrasts to just a few months prior when COVID-19 caused nervous Vacation Rental Owners to sell rental property due to cancellations and uncertainty.

Airbnb saw more nights booked for U.S. listings between May 17 and June 3 than the same period in 2019, and a similar boost in domestic travel globally,”

Bloomberg June 7, 2020

Reasons for the Popularity

Travelers are finding that it is much easier to social distance from others in a home with their own cooking and entertainment, than a hotel room. And working remotely from home, any home, has added to the enthusiasm, as families who have been cooped up for several months, look for a break.

Based on vacation trends discussed in Travel & Leisure in June, several key indicators favor private homes: Stays are Getting Longer, (reducing minimum night stay requirement risks); Private homes are desired over Condos and Hotels with Common Areas; Drivability to the Location instead of flying will be key; Pet friendly will be a huge draw; and Cleanliness is Critical.

The Effect of Low Interest Rates

Real estate continues to be a strong investment in most American’s portfolios (chart).

https://news.gallup.com/poll/309233/stock-investments-lose-luster-covid-sell-off.aspx
news.gallup.com April 24, 2020

Today’s investors are able to benefit from today’s low interest rate environment. With current low rates, investors are able to have the same payment on a $333,000 home that cost $226,000 five and a half years ago in greater Phoenix. And analysts seem to be unanimous that housing appreciation will continue.  More Market Stats here.

Vacation Rental Management Companies Paying Attention

At least some companies in the sector are making necessary changes while searching for COVID opportunities. Airbnb launched a heightened cleaning protocol for hosts, with guidance from the former U.S. Surgeon General Vivek Murthy, M.D., and leading experts in hospitality and medical hygiene. After re-thinking its plans for an IPO, don’t be surprised if the organization soon makes its market debut. And the stronger the industry, the louder its lobbying efforts. According to Fortune.com on June 30, “Airbnb is on track to have a better 2020 than 2019,” claimed CEO Brian Chesky on the Leadership Next podcast.

Booking flexibility is a huge factor in most survey results. According to an article in AARP in May, “Vrbo said it would ask hosts to refund a minimum of 50 percent of what customers paid, if they are not willing to rebook at another date.” Vrbo also rewards its host homeowners that demonstrate flexibility by posting a “cancellation badge” on that property’s profile.

Airbnb introduced some tools and programs called “More Flexible Reservations” to help hosts and guests navigate uncertainty as plans are canceled or postponed. If guests need to cancel bookings made during certain dates, both VRBO and Airbnb are refunding their nominal guest service fees redeemable on a future trip.

Scottsdale Arizona Ranks #1 for Vacation Rentals

In a Study by Realtor.com in April 2019, Scottsdale Arizona ranked #1 in its Study “Top 10 cities Where Vacation Rentals Rake in the Most Cash.” Criteria included the home affordability, and therefore the profitability of the business. Other criteria included rates, demand, per capita number of short-term rentals, average income as a ratio of monthly mortgage payment, and one-year home appreciation.

Why is Scottsdale such a popular location? Located in Greater Phoenix Metro, Scottsdale is a hotbed for American corporate elites looking for a weekend getaway full of mountain biking, golf, and hiking. And while cities across the country are creating tighter rules and outlawing Airbnb rentals altogether, Arizona has gone in the other direction—it signed a law in 2016 that prevents cities in the state from banning short-term rentals. That legal protection, combined with vacation rental demand, has made Scottsdale successful for investors for many years. (Note: laws can change. Also, there are stipulations, such as limitations to no more than six adult guests, etc.)

Golf Course with the Superstition Mountains backdrop in the Greater Phoenix Metro
Over 200 golf courses in the Scottsdale area

Another reason for the Scottsdale vacation rental boom: More than 200 golf courses and year-round sunny skies and 15 Major League Baseball teams stay in the greater Phoenix area each year during March Spring Training. These coaches, players, and their families often prefer renting an entire Scottsdale home than a hotel room for two months. And there are plenty of fans eager to rub shoulders with their favorite stars in a low-key setting. Other events include the Waste Management Phoenix PGA Open, the Arabian Horse Show and Equestrian Events and the most well recognized Collector Car Auction week.

Vacation rentals range from 7+ bedroom sprawling estates or Mountaintop Luxury Homes in Paradise Valley, to Horse Ranches in Rio Verde and North Scottsdale, to modest 2-3 bedroom homes with private pools. The budget-minded can score a relative bargain here when prices drop in the summer.

More on SCOTTSDALE

About the Author: Denise van den Bossche has been a licensed Agent and homeowner for over 35 years in the Metro-Phoenix-Scottsdale Valley of the Sun. A Legacy LEED® AP, designated SRES, DMX, ePro. To request a no-obligation market report, home evaluation, or consumer guide on your specific needs, contact Denise at 602.980.0737 or email  Denise@AZMultipleListingService.com.  Denise’s husband Patrick is President of Realty Executives International, with 500 offices throughout North America.

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June 2020 Low Rates & Tight Inventory

Today’s low interest rates allow you to pay about the same monthly payment for a $333,000 home today, as you would have for a $249,000 home in 2005, 15 years ago.

And real estate is still proving to be the best long term investment.

https://news.gallup.com/poll/309233/stock-investments-lose-luster-covid-sell-off.aspx
Gallup Poll April 24, 2020

Real estate, at 35%, remains the most favored investment to Americans, as has been the case since 2013, when the housing market was on the rebound. More than a third of Americans have named real estate as the top investment since 2016

News.Gallup.com/poll/stock-investments-lose-luster-covid-sell-off

According to Diana Olick, CNBC, on May 27, “Mortgage demand from home buyers shows unexpectedly strong and quick recovery… The quick recovery has surprised most forecasters.”

75+% of job loses are temporary layoffs and furloughs according to employers – Federal Reserve Bank May Report

Low Rates are also providing Affordability of Housing, which is the OPPOSITE of the artificial run up in 2004-2006. Also, demand is by owner-occupied this time, not investors.

Full presentation with charts and graphs: presentation

About the Author: Denise van den Bossche has been a licensed Agent and homeowner for over 35 years in the Metro-Phoenix Scottsdale Valley of the Sun. A Legacy LEED® AP, designated SRES, DMX, ePro. To request a no-obligation market report, home evaluation, or consumer guide on your specific needs, contact Denise at 602.980.0737 or email  Denise@AZMultipleListingService.com.  Denise’s husband Patrick is President of Realty Executives International, with 500 offices throughout North America.

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TODAY’S LOW RATES WIPE AWAY YEARS OF HOUSING APPRECIATION

If you are one of the buyers holding off the last few years of housing appreciation, then the news that the Valley housing seems to be immune to Covid-19 is not good. But no worries, today’s low rates are wiping away years of appreciation in the housing market nation wide.

THE MARKET DATA YOU READ IS ALREADY OUTDATED

Timing is everything in the real estate market. And if you’re curious about the market, by the time you read the newspapers or economic websites, the market has already changed.

CONTRACTS ARE UP 65% OVER THE LAST 6 WEEKS

During the 6 week period from the beginning of the coronavirus shutdown to mid April, contract activity in the valley dropped 39%. You may begin to see news stories about a decline in sales – because most escrows take 30 – 45 days to close. This drop-in activity is old news. What’s not getting reported – yet – is the 49% 65% increase in accepted contracts over the last 5 weeks (this 49% jumped to 65% in the week that elapsed between today and when I recorded my share-screen charts (link at end of this blog). THAT’S WHAT I’M TALKING ABOUT

BUYERS may be MISSING THE OPPORTUNITY

This is all key information for buyers right now, especially if they’re on the fence waiting for the market to “crash”. This increase in buyer demand will not be widely reported for another month because these contracts still need to close.

One mistake buyers make is waiting for closing reports before acting. By the time a property closes escrow and the sales price is publicly recorded, the conditions that the transaction was created under may have already passed.

BUYERS LOOKING AT AVERAGE PRICED VALLEY HOMES

Because I watch real time data, I can assure you that contract activity is up across all price points in Greater Phoenix, but the average list price per square foot is only down on contracts over $500K. (more on the luxury market separately, and specifically Paradise Valley).

All other price points below $500K are seeing the average list price per square foot either higher than or equivalent to where it was 10 weeks ago in February. SO, those buyers waiting for sale prices to decline are truly missing out.

YOU CAN PAY LESS NOW FOR THE SAME HOME YOU WANTED IN 2016

Mortgage rates have declined while the median sales price rose 8.9% over last year (more than double the national average, full Phoenix Business Journal) but it works it to a net gain for buyers. The principal and interest payment on a $300K, 30-year, fixed-rate mortgage went from $1,450/month to $1,307/month. That’s down a 10% decline over the course of a year.

Here’s a cool example: If you factor in housing appreciation on a home purchase of $330k, today’s low mortgage rates would give you a payment around $1,300/mo… while back in 2016 that house would have cost around $324k, but your payment would have been around $1,854/month.

Today’s Low Mortgage Rates, is a Temporary Phenomenon

WE ARE NOT SEEING ANY SIGNIFICANT PRICE DROPS

The drop in market activity has impacted seller’s only slightly. We’re not seeing significant price drops but we are seeing sellers making more concessions to buyers with the percentage of homes closing with seller-assisted closing costs, increasing from 18% to 25% over the last 4 weeks.

To see the charts that accompany this information, click here.

About the Author: Denise van den Bossche has been a licensed Agent and homeowner for over 35 years in the Metro-Phoenix Scottsdale Valley of the Sun. A Legacy LEED® AP, designated SRES, DMX, ePro, EcoBroker and co-founder of Seniors Advisors Advising Seniors®, a consortium of experts to surround and support families facing aging or chronic illness. To request a no-obligation market report, home evaluation, or consumer guide on your specific needs, contact Denise at 602.980.0737 or email  Denise@AZMultipleListingService.com.  Denise’s husband Patrick is President of Realty Executives International, with 500 offices throughout North America.

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9483 N 57th Street, Paradise Valley For Sale $1,349,000

NEW LISTING – Home for Sale in Paradise Valley on 1.19 Acres of Lush Grass and Move-in Ready. 3,969 Square foot 4 Bedroom, 4 Bath for sale in popular neighborhood surrounding the Camelback Country Club’s Ambiente Golf course.

Views from the front door are directed through the large covered patio and into the private back yard oasis. High ceilings and beautiful exposed wood beams. Gourmet kitchen features Subzero, Double Oven, and Pantry. Kitchen, Breakfast and Family Rooms share a large granite wet bar with views to over 1,000 square feet of covered outdoor patio with sky light.

Back yard private & lush, with roses & citrus. Architectural drawings show a future North-South Tennis Court.  

Master features fireplace, sitting area, glass doors to back, his & her sinks and closets, a vanity, separate shower, tub, and private commode. Den with double French doors to front courtyard. Guest bedrooms #2 and #3 share Jack/Jill Bath, each with 5050 window Seat w /storage.

Circular driveway with side entry 3 car garage. Diving Salt Water Pool with in-floor cleaning system, Variable Speed Pump, heated spa, iron fence. 1.119Acre Lot / Single Level. Highly desired neighborhood designed with walks to Camelback’s Ambiente Course & Cherokee Elementary School.

Property Taxes

Out of state buyers will appreciate 2019 property taxes were under $7,000. That is less than some of the neighborhoods at the Biltmore in Phoenix on much smaller lots.

Proximity to City Center

Quiet street popular to walkers, runners and bicycles for its rolling hills, acre+ lots, and adjacent golf course. Pride of ownership in this non-HOA community demonstrated by neighboring homes $2M to $4M…. makes this a great opportunity with high investment potential.  Minutes to Shops at Gainey Village, Sprouts, The Gainey Village Health Club & Spa. Minutes to Trader Joes, Whole Foods, and Fry’s Marketplace, Starbucks.

Meticulously maintained second home with 2 of the 3 heat pumps still under warranty, and new irrigation lines and more.

PARADISE VALLEY Arizona

Paradise Valley tops the list for safest and wealthiest city in Arizona with estates exceeding $20 Million.  Many Neighborhoods have no HOA, yet residents demonstrate pride of ownership: Our median home price is $2175,000 and price per square foot is $448 (Realtor.com Jan 2020). Sure, there are higher priced neighborhoods such as the Silverleaf HOA neighborhood in North Scottsdale, an hour away. Camelback Mountain is located in Paradise Valley, which makes it equally convienientt to Scottsdale’s Kierland Commons, Old Town, Tempe, and downtown Phoenix.

Value Opportunity

I pulled a report on Memorial Day on all activity over the last 30 days including Active, Pending and Sold. 55 homes are listed: Average home price is/was $2,682,871. Average square footage price $449.68. Average days on market to close is 116!

This home, located on a quiet street across from the Ambiente golf course, is listed at $1,349,000 ($339.88/sf), and is the 3rd lowest priced, with homes priced up to $6M. One of the 2 priced lower is being sold for dirt $1,100,000 and sits on Mountain View Rd, to give you an ideal of lot values here. Call me for the full report, as well as dozens of nearby lot/scrapped/new-build/resales over the last couple of years.

DETAILS including pictures will be updated here

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Arizona Housing Market will See a Long Slow Recovery

Arizona Housing will recover, slowly but surely. According to Cromford today, the higher priced homes in Arizona will probably see some further weakness, however the bulk of the market looks safe.

May 30 update: In the past two weeks, we have seen an amazing surge in demand in $1Million + homes. The home above located in Camelback Country Acres, Paradise Valley, sold on the first day listed May 30, and has 2 solid back up offers. (For more info)

Buyers Will Take Advantage of Low Rates

“Once buyers realize this they are likely to return in larger numbers to try to capitalize on low interest rates. Whether this results in more sales is an open question because lenders are likely to be more careful about approving loans than they were before March. The pool of potential buyers has been negatively affected by the huge increase in unemployment so it would be very surprising if a rapid recovery were to take place. Far more likely is a long hard slog. I think we would mostly prefer a long hard slog uphill than a continued free fall downwards.” It may be the only chance a first time home buyer may have for many years. All indications, and not just Cromford, state that Arizona housing prices will continue inching upwards.

“A clear case can be made that the housing market will not be dramatically affected by the pandemic over the long term, no matter how severe the jolt may be in the short term. The underlying shortage of homes for sale remains intact and now the wave of Airbnb properties turning into long term rentals is dying down, there will also be a shortage of homes to rent. Even with the gloomiest of forecasts, Central Arizona has more demand for homes to live in than it has homes available. This is not 2006.” Simply put, it’s supply and demand. Supply is down, Demand is up. Maricopa continues to top the nation in relocations.

Nervous Sellers will Accept Low Offers, and regret it.

“Sellers who accept low-ball offers from buyers out of fear of the future are probably not making a sound decision and are likely to regret it. A significant fall in home values requires a glut of available homes relative to demand and that does not look at all likely based on today’s trend lines. Of course no-one can predict the future with certainty, but keeping a close watch on the number of active listings is not hard. If you look back at history, home values come under downward pressure when the number of active listings becomes excessive. This is what happened between 2006 and 2011 with most of the decline in values taking place during 2007 and 2008. During those years active listing counts were vastly higher than they are now.”

Paradise Valley may be entering a Buyer’s Market

For my Paradise Valley sellers, if you are planning to sell in the next year, there seems to be a great opportunity right now. Inventory is extremely low, and there is pent up demand from the first two months of Covid-19. In addition, the low rates are allowing buyers to look at a higher price points, so families looking for the long term are especially interested in neighborhoods near great schools. Although we cannot time the market, recent activity suggests now may be a great opportunity. At the time of this blog, Cromford was indicating that PV may be one of the first cities to enter a Buyer’s Market.

“The remaining cities look likely to remain seller’s markets despite the huge decline in their CMI. However the balance in negotiations will not be as favorable to sellers as it was during the first quarter of 2020. Among these cities, Scottsdale has the highest chance of entering a balanced market, but this is still looking unlikely at the moment.”

The Cromford® Market Index roller-coaster ride is getting to the bit where you realize you are not going to die after all.

Quotes above sourced from the Cromford Report May 14 2020 commentary, courtesy of Denise van den Bossche, subscriber.

Scottsdale and two other Metro-Phoenix Cities named best for job opportunities in 2020. More Here.

MORE ON THE ALMOST DAILY NEWS ON COVID 19’s effect on the Housing Market in the metro-Phoenix Valley Here.

About the Author: Denise van den Bossche has been a licensed Agent and homeowner for over 35 years in the Metro-Phoenix Scottsdale Valley of the Sun. A Legacy LEED® AP, designated SRES, DMX, ePro, EcoBroker and co-founder of Seniors Advisors Advising Seniors®, a consortium of experts to surround and support families facing aging or chronic illness. To request a no-obligation market report, home evaluation, or consumer guide on your specific needs, contact Denise at 602.980.0737 or email  Denise@AZMultipleListingService.com.  Denise’s husband Patrick is President of Realty Executives International, with 500 offices throughout North America.

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Scottsdale Best for First Time Homebuyers & Job Opportunities

Scottsdale tops the list for job opportunities 2020, according to Wallethub. And for those who have the job security, this may prove to be the best time for first-time homeowners to take advantage of the Pandemic. Chandler and Tempe also ranked some of the highest cities on the list. Read more here.

Mortgage rates are a historically low levels and home prices have at the very least stopped the steady appreciation we have seen over the last decade. But, as always, this is not about trying to “time” the market. This is for those who have the job security and know they will want to be in a certain neighborhood within the next couple of years. Check out the full article here.

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COVID-19 Devastates Housing Market

Coronavirus Ends an Amazingly Strong Decade-Long Housing Market Boom

COVID-19 has temporarily halted a robust housing market and an entire sector of the economy that depends on it. Nationally, first quarter indicators show the real estate market has slowed, with experts predicting a 30-35% drop in inventory for April as compared to a year earlier, according to the Luxury Market Report (full report links at end of this blog).

The luxury market was at a record pace according to Realtor.com’s Chief Economist Danielle Hale this month,

“A low interest rate environment combined with flourishing economy and record setting stock markets pushed luxury sales into the double digits for the first time as 2019 came to an end.”

Arizona’s most popular tourist season and the highest buyer activity occurs each March and April. This season was lost in 2020 as out-of-state buyers who had been house hunting for weeks, months, and often times, years, postponed their trips.

Initial Urgency and Panic

Real Estate transactions under contract when the World Health Organization announced the global pandemic on March 11th had legitimate concerns.  Reactions ranged from newly unemployed buyers with loans in jeopardy, to those panicked by the uncertainty and willing to cancel and walk away from earnest deposits. Agents scrambled to negotiate extensions and/or postpone closings, some faced by the domino effect of homes under contract contingent upon the sale of another transaction.

COVID-19 causes reduction in home purchases
Number of Contracts declined over 70% over a 2 week period in some cases

Advances in Technology Allows Business as Usual

Current technology is allowing transactions to move forward.  Many areas, including the greater Phoenix Valley, allows digital mortgage approvals, remote signings, and digital closings. Additional technology tools available, but little known before, are now being implemented for virtual appraisals, inspections, showings and more. Ten years ago, this situation would have had a much greater impact on transactions moving forward. One new change in most states is a new “COVID-19” Addendum, being required by most brokerages that allows parties to automatically extend dates or cancel the contract without penalty in the case of coronavirus impacts.

Real Estate Marketing’s “New Normal”

Real estate agents are attending webinars at record numbers to learn new techniques and invest in new technology.  Listing Agents are implementing virtual tools such as Matterport, Videography, and live open houses on social media outlets. Buying Agents are conducting virtual home tours balancing gloves, masks, and other precautions and hygiene recommendations from both the Center of Disease Control and their respective brokerages. The average work day of most agents has increased, and in addition, many are balancing the addition of home bound children due to the quarantine.

When the 2008 Great Recession officially ended in June 2009, it is estimated that over 25% of licensed agents left the industry. New, part-time and tenured agents alike, most working on 100% commission, will spend 2020 analyzing the costs of doing business. We have already seen numerous “i-buyers” close their doors. After an amazing decade in the housing market, the National Association of Realtors announced in January that they had reached a membership of 1.4 million in 2019, an all-time high. NAR totals do not include the active licensees technically “inactive,” holding licenses to speculate as principals or negotiate for family members without being held to the NAR Code of Ethics.

Locally, Property Taxes are still due

Locally, Maricopa County Treasurer sent out notice this week that there would be no extension for May 1 property tax payments, however, there is no interest incurred if paid by May 29, the last business day of the month. Arizona had the 5th lowest property taxes of 2019.

How This Compares to the 2008-2009 Recession?

Arizona’s most respected source of residential real estate data demonstrates a clear comparison of today’s market with that of the Great Recession. As shown in the Supply and Demand Index, demand in 2008 was nearly 50% below normal, with supply 200% above normal as early as two years earlier. We are nowhere near those levels. Those buyers were also investors, what we call “false” demand, unlike today’s owner-occupant buyers. In addition, additional graphs show affordability was artificially high then, which is not the case today. While we expect a recession, we are not anywhere near the crash experienced over a decade ago.

Supply & Demand 2008 - 2020
2020 is not even close to the crash we experienced in 2008

How is Arizona’s Market Today vs 2 Weeks Ago?

The market is fluctuating significantly every week, as is the Government’s involvement adjusts and the pandemic matures. To make any solid predictions would be unreasonable based on this uncertainty. The graph on Weekly Contracts shows the downturn in housing purchases as a result of the stock decline beginning February 19, and Arizona’s initial business shut down on February 23. At this writing we have no vaccine and no real knowledge of this virus. According to Cromford, the market today is “less bad.”  We are still in a Seller’s market, and pent up demand is increasing. We still have buyers needing to buy, and Maricopa is still the top relocation county in the nation. Interest rates are at historic lows, but unemployment is over 18%. Jumbo loans have evaporated. As with every other downturn, cash is king.

Links: Luxury Market Report’s April report. (previous reports)

 If you would like a print version of any of my reports, or if I can help you buy or sell anywhere in North America, please let me know denise@AZMultipleListingService.com or text 602-980-0737

About the Author: Denise van den Bossche has been a licensed Agent and homeowner for over 35 years in the Metro-Phoenix Scottsdale Valley of the Sun. A Legacy LEED® AP, designated SRES, DMX, ePro, EcoBroker and co-founder of Seniors Advisors Advising Seniors®, a consortium of experts to surround and support families facing aging or chronic illness. To request a no-obligation market report, home evaluation, or consumer guide on your specific needs, contact Denise at 602.980.0737 or email  Denise@AZMultipleListingService.com.  Denise’s husband Patrick is President of Realty Executives International, with 500 offices throughout North America.

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April 2020 Luxury Market Report

The coronavirus pandemic 10 years ago would have brought the housing market to a halt. Its effects on human life and the economic impacts are being felt by every single individual. It will be interesting to track the COVID-19 effects on the housing market. 2019 ended an amazing decade for residential real estate nationwide. Thanks to technology, real estate is still considered an essential business and continues to show activity in most parts of the country.

The World Health Organization announced the global COVID-19 pandemic on March 11th. Luxury homes, however, continued to be bought and sold nationwide at an increasing rate until the end of March.  Million-dollar home sales had increased by 11.4 percent year-over-year, a trend which continued well in to March 2020.

Since the last week of March, all indicators now show that the real estate market has started to slow down due to COVID-19 effects, with experts predicting a 30-35% drop in inventory for April as compared to a year earlier, according to the Luxury Market Report’s April report.

In Arizona, our most popular tourist and buyer months of March and April were lost, as out of state buyers postponed their travel plans.

Denise van den Bossche, 35 year Real Estate veteran, Scottsdale Arizona

We expect that this situation will have a lasting impact on how real estate transactions will be conducted in the future.

Stay up to date as to how COVID-19 is effecting Metro-Phoenix

About the Author: Denise van den Bossche has been a licensed Agent and homeowner for over 35 years in the Scottsdale – Metro-Phoenix Valley.

A Legacy LEED® AP and designated SRES, Denise has a focus on luxury homes and investment properties and healthy “green” living. She is a co-founder of Seniors Advisors Advising Seniors®, a consortium of experts to surround and support families facing aging or chronic illness. To request a no-obligation market report, home evaluation, or consumer guide on your specific needs, contact Denise at 602.980.0737 or email  Denise@AZMultipleListingService.com.  Denise’s husband Patrick is President of Realty Executives International, with 500 offices throughout North America.

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