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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COVID-19 AZ Housing Market Report April 15, 2020

Things change weekly, if not daily, in the COVID-19 housing market! As an essential business, the real estate industry is continuing to operate, despite the challenging conditions. Housing is a vital need for everyone and the Coronavirus has not changed this here in the Phoenix metro housing market. Here is the Cromford Report for Maricopa County as of April 15, 2020.

This is causing a build-up of pent up demand that will undoubtedly return with some gusto when travel restrictions are lifted and a level of stability returns.

The Valley has been in a very strong sellers market for a long time, and even with the coronavirus, it could take months or years to move into a buyer’s market. Real estate prices are tied to supply and demand, and our supply his still too low. We unexpected have some buying opportunities in a turn-around from entering 2020.

Click here to go for Cromford commentary with associated graphs

For Buyers:


The kickoff of 2020 was developing into a nightmare for normal buyers who just wanted to find a place to live.  Extreme competition for homes between wholesalers, cash buyers, vacation rental investors and traditional buyers depleted supply and created an environment consisting of multiple offers, appraisal waivers and an increasing number of sales over asking price. The Greater Phoenix housing market was on the precipice of seeing price appreciation accelerate at an alarming rate and had analysts wondering what could possibly slow it down. 

Well, they have their answer, an act of nature. The COVID-19 pandemic came in like a wrecking ball in March shutting down tourism and crashing the stock market single-handedly over the course of a few weeks.  Hedge funds and iBuyers (funded by Wall Street) bowed out of purchases and vacation rental buyers put their plans on hold.  This is providing much needed relief to normal home buyers, if only they could leave their house. Stay-at-home orders to stem the impact of the pandemic has “pinched the hose” on what is arguably one of the hottest housing markets in the country. 

This is causing a build-up of pent up demand that will undoubtedly return with some gusto when travel restrictions are lifted and a level of stability returns. Do not expect prices in Greater Phoenix to drop like they did in 2008, however. Back then when investors pulled out of the market, prices were so high that families making the median income could only afford 27% of what was selling.  This time around as investors once again pull out of the marketplace, families making the median income can afford 68% of what’s selling with today’s incomes and interest rates.  This is well within normal range and puts regular home buyers in a better position to pick up the pieces left by Wall Street and vacation rental investors. 

For Sellers


Lock downs and travel restrictions across the country are causing buyers who need to relocate to Arizona, either for a job or to retire, to put those plans on hold for now.  The effects of COVID-19 span the job market, stock market, corporate profits, and exchange rates. This has had the highest impact on high-end luxury market buyers.  Not only are these buyers restricted from leaving their home cities at the moment, they have instability in their portfolios as well.  Under these circumstances it should not come as a surprise to see that weekly contract activity over $500K has slowed down by 64% since their peak on February 24th while price points under $500K have only seen a 30-40% slow down.


Sale prices are not declining at the moment, but seller expectations are adjusting.  Upticks in weekly price reductions tell us that sellers are beginning to ease up on pushing market value.  Sellers are also beginning to realize that it will take longer to sell their home under these conditions.  Weeks ago, some listings were receiving multiple offers within a matter of hours, but that’s not a reasonable expectation now.  Active listings that would’ve flown off the market 4 weeks ago could be on the market for weeks, maybe even months at this rate.  Information, communication and strategy will be important during the course of the pandemic response.  It is situations like these where professional REALTORS® get to show the value of their experience and service.

April 4 2020 Infograph

Commentary written by Tina Tamboer, Senior Housing Analyst with The Cromford Report
©2020 Cromford Associates LLC and Tamboer Consulting LLC.
Provided as a proud subscriber of the Cromford Report, the Metro Phoenix’s most respected source based on the campus of Arizona State University. Commentary provided by Tina Tamboer, Senior Housing Analyst. If you would like a print version of any of my housing market reports, or if I can help you buy or sell anywhere in North America, please let me know below, email or text!

About the Blogger Denise van den Bossche has been a licensed Agent and homeowner for over 35 years in the Metro Phoenix Valley. To  CONTACT Denise, please call 602.980.0737 or  EMAIL:  Denise@AZMultipleListingService.com. Her husband Patrick is President of  Realty Executives International, so if you need help buying or selling homes anywhere in the U.S. or Canada, please call, email or text!Category:  https://blog.azmultiplelistingservice.com/category/market-stats    or (www.azmultiplelistingservice.com/Market-Stats which will forward to the most current blog)

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Arizona Property Taxes rank #5 in the nation

Arizona ranks #5 in the nation according to the taxfoundation.org 2019 calculations (chart). Maricopa County collects, on average, 0.59% of a property’s assessed fair market value as property tax according to tax-rates.org

Properties categorized as primary residences enjoy the lowest rates. In some cases, you can consider a home primary if you can prove you purchased it for a qualifying family member. A qualifying family member is defined in A.R.S. §42-12053 as:

  • Child-in-law or parent-in-law or
  • Natural or adopted sibling
  • Owner’s natural or adopted child or descendant of the owner’s child
  • Parent or ancestor of the owner’s parent
  • Stepchild or stepparent

More on reclassifying a property in Maricopa County can be found here.

Property taxes in Arizona are paid in two semi-annual installments, one due on Oct. 1 of the current tax year and another due on March 1 of the following year. MARICOPA TREASURER’S OFFICE. According to a notice sent out to tax payers in April 2020, there is no relief for the second 2019 payment because of COVID-19, however, there is no interest or penalty if paid by the last business day of May which is May 29 this year. As always, seek advice from your tax professional.

How Arizona Calculates Limited Property Value

The following is from the Maricopa County government websites as of April 2020: 

A handful of numbers are used to calculate the property tax due on each piece of real estate in Arizona. The first is the current cash value of your home. Arizona counties calculate a full cash value of every house in the county, often based on the sales prices of nearby, comparable homes.

Taxes are not based on the full cash value, however, but something called the Limited Property Value (LPV), which is based on cash value. It cannot exceed the cash value of the home and is further limited in how much it can increase each year. A law passed by Arizona voters in 2012 states that the LPV can increase by no more than 5% from one year to the next. This limits tax increases in times when home values are increasing quickly.

Tax rates are applied to assessed values. The assessment ratio for residential property in Arizona is 10%. That means assessed values are equal to 10% of the LPV.

 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 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.

This article is an excerpt from the Consumer Guide “Do yourself (and your Wallet) a Favor and use a Tenured Local Professional when Buying Real Estate.”  Denise van den Bossche, 35 year agent Scottsdale Arizona, copyright 2019.   

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Phoenix remains a Seller’s Market despite the CoronaVirus

Phoenix remains a Seller’s Market, despite the CoronaVirus. In addition, according to the Cromford Report, the most respected local source, there is no indication the coronavirus pandemic will cause any serious drop in home prices.  Each day we get new information about what’s happening with the CoronaVirus economy, but as of March 31, we have seen little impact on the housing market.

It is inevitable that the market will shift, but it is hard to say when.

We still have a shortage of active listings, and demand has been normal in homes priced under $300,000. We are seeing some buyers slow down active shopping, but we are still seeing tremendous activity in the market. We expect this activity to decline due to the uncertainty in the economy.

A Further Reduction of Inventory.

The shortage of home inventory will increase with the help of the coronavirus thwarting travel plans of buyers. Sellers will react to the lack of those buyers choosing to shelter at home during some of the Valley’s most active tourism months. The weeks and months leading up to Easter are typically some of the busiest for home shoppers. As the number one county for relocations in the U.S., many families planning their move to the Valley take advantage of Spring Break to look at homes. March is busy with visitors for Spring Break and Spring Training, both which took a hit this year as travelers opted to shelter at home.

We also expect some Sellers will pull their homes off the market temporarily to avoid coronavirus exposure, and to encourage buyers and Realtors to stay at home. Frequently Sellers will take their home off the market during the summer months to reset the cumulative days on market during the least busy season. Those planning on taking advantage of the busy month of March, will also wait now until the fall. This slight reduction in supply may balance some of the drop in demand. But it is still doubtful that there will be an over abundance of home inventory this winter. New home construction, which was already way behind the demand curve, may slow down, but it definitely will not speed up during such economic uncertainty.

One of the biggest hit markets for real estate are short term rental owners. Most people make the bulk of their income now- during what is usually peak tourist season. Without tenants this year, many will have difficulty making mortgage payments and may opt to sell their investment properties, perhaps helping to ease the shortage of supply. Many may have been considering selling anyway due to the rise in competition and increased restrictions in recent months. However, some of the larger companies such as VRBO.com are offering to reschedule trips without penalty, so the Fall 2020 – Spring 2021 may benefit some landlord/investors.

A Recession is Coming

Let’s talk recession. It’s safe to assume that a recession is coming. However, these is little analytical data to back up the conclusion that home prices will fall. Obviously, anything can happen in an uncertain and disrupted world, but a fall in home prices is still looking very unlikely from today’s numbers.

The Cromford Report

2005 vs 2020: The Difference in the Housing Market

In 2005 homes were being used as speculative commodities not for places to live. Unscrupulous lenders were making irresponsible loans. The housing industry (and more particularly the lending industry) was the cause of the 2008 recession. Phoenix was a hot spot for the cause of the problem.

In 2020, housing is an innocent bystander to a probable recession caused by a pandemic. It has supply at extremely low levels and most homeowners have a large amount of equity. Even if they lost all their income and could no longer pay their mortgage, they could quickly find a buyer to release that equity. Most lenders are offering deferred payment options on home loans. Only when demand collapses do the banks have to foreclose to get their money back. At the moment, demand is still well above normal and has only shown very little signs of easing. And the government is putting new safety measures into effect every day.

Will It Turn Into a Buyer’s Market? Will Prices Drop?

My take on it?  The folks at Cromford are confident that any chance of a surplus of inventory changing the current Seller’s market is highly unlikely. As they put it, “A successful vaccine for the corona virus is more likely to appear before a surplus of homes could possibly develop.” This pandemic, the Federal response, the Global effects, and the Gas/Oil price drop are all unprecedented, and all at once. No one can possibly predict the outcome. But it is likely that Phoenix will remain a Seller’s market despite the CoronaVirus. As discussed earlier, experts still forecast a continued rise in home prices.

As you know, information changes daily so if you have any questions as time goes on, please don’t hesitate to give me a call.  You can watch my video with more data on this report here.

 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: This information was provided by the Cromford Report located on the ASU Campus in Tempe. Additional insights were added by Denise van den Bossche, 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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COVID-19 creates Homebuyer Opportunity

With rates at an all time low, we finally have a window of opportunity in this Seller’s market and prices expected to continue their gradual rise, this is an amazing opportunity to buy a home. By calculating the savings provided by 3% rates, homebuyers can afford a nicer home than anticipated, or even a second home. In addition, current sellers are going to be much more willing to negotiate than they were before.

Most experts agree that the housing market is not going to be as affected as bad as the rest of the economy. While prices might stagnate for a bit, they are not expected to drop substantially. And after the pandemic fear is over, these prices are expected to recover quickly. Buyers who have been delaying making a decision will re-enter the market to find much higher prices.

  • The falling rates will continue to keep inventory low
  • “Sideliners” will continue to push rental rates higher, making a mortgage more attractive
  • In 2019, Phoenix metro provided more than 75,000 new jobs, so even a slow down in this pace will continue to make Maricopa county the fastest growing in the nation

A purchase in Phoenix Metro provides an even stronger proposition when combined with the lower cost of living. Buyers can either have a lower overall payment, or afford a larger home. And the U.S. government states they will add additional incentives.

  • Calculate the savings of a 3% mortgage on a 30-year payment
  • Add to that Arizona’s amazingly low property taxes
  • Don’t forget to factor in lower insurance rates due to historic lack of natural disasters other states experience
  • Other cost of living considerations can be evaluated from various souces.

Prices of homes will continue to rise over the next few years. New home sales have increased dramatically, and as of today, have not slowed down (Arizona Business Journal 03-21-2020 link). New home sales have not increased this much since mid-2013. The median price of a home sale in the Valley in February increased by 3.5%.

In addition, new home sales have not increased this much since mid-2013. The median price of a home sale in the Phoenix Valley in February increased by 3.5%.

There are numerous factors that makes this time a great real estate opportunity. In addition to the rate cuts, The Fed is buying back $500 billion worth of treasure bonds and $200 billion of mortgage-backed securities (“Quantitative Easing”)

As we adjust to the “new normal,” remember that I am just a phone call, text or email away to answer ant real estate related questions or concerns. I am using technology to live stream property tours, share virtual tours, and market your home to our global network of prospective buyers. We are also continually scheduling private appointments and creating videos for on line views. Below is a list as of March 20 of the cases of COVID-19 by state:

As of March 20, cases of COVID-19 by State, lists Arizoma #39 – The Cromford Report1

 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 text602-980-0737

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

Legacy LEED® AP and designated SRES, Denise has a focus on healthy indoor environments and Aging/Chronic Illness. She is an affiliate of Seniors Advisors Advising Seniors®, a consortium of experts to surround and support families facing aging or ailments. To request a no-obligation market report, home evaluation, or consumer guide on your specific market, 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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Home Prices Not Expected to Go Down anytime soon

Sharing an article from Michael Orr – March 18, 2020

A number of people seem to assume that we are heading for a recession and that home prices will fall. The first assumption is quite reasonable. The second assumption is based on fear and has little analytical data to back it up. Obviously anything can happen in an uncertain and disrupted world, but a fall in home prices is still looking very unlikely from today’s numbers.

In 2005 the housing industry started to sicken because homes were being used as speculative commodities not for places to live. In 2005 I met a man in his early 20s who owned 12 homes in the Phoenix area, all with no occupants. How had he been able to buy them? 100% loans from unscrupulous lenders who went bust between 2007 and 2010. The housing industry (and more particularly the lending industry within it) was the cause of the 2008 recession. Phoenix was a hot spot for the cause of the problem, as was Las Vegas.

In 2020, housing is an innocent bystander to a probable recession caused by a pandemic. It has supply at extremely low levels and most homeowners have a large amount of equity. Even if they lost all their income and could no longer pay their mortgage, they could quickly find a buyer to release that equity. There is little likelihood of them facing foreclosure because the lender can be paid off with the sale proceeds. Only when demand collapses do the banks have to foreclose to get their money back. At the moment demand is still well above normal and has only shown very tiny signs of easing. In 2006 demand fell off a cliff yet home builders continued to build even more new homes because lenders continued to write ill-advised loans in huge numbers.

In 2020 builders are probably going to have to build fewer homes than they wish because of shortages of labor and materials. We are unlikely to see a glut of homes on the market for a very long time. A successful vaccine for the novel corona virus is more likely to appear before a surplus of homes could possibly develop.

Because the virus has not been contained yet, except in several parts of Southeast Asia, we are likely to see a lot of people out of work. We do not yet know how long it will take to get control of the pandemic in Arizona, but many people may be out of work for quite some time. These people are more likely to be renters rather than homeowners. Landlords may find it much harder to collect rents and the yields from their portfolios are likely to fall. Some may decide to evict tenants and sell their properties. At the moment the extra supply would be welcomed and receive multiple offers, even in these troubled times. The evicted tenants still exist and therefore still represent demand for shelter of some sort. There will be hardship, but not a flood of homes with no-one to live in them.

Housing demand is created by the existence of people and increases when more people turn up and decreases if they go away. In 2005 the people we were building new homes for were largely imaginary. In 2020 they are very real and migration trends have been very favorable with families and individuals moving to Arizona from other parts of the USA.

All the indicators for the Central Arizona housing market remain very healthy at the moment and we will report any change as soon as we spot one. There is no cause for panic and if you are delaying a purchase because you think the price will come down, you are probably making a poor decision.

Mike Orr

Cromford Report

www.cromfordreport.com

Sharing an article from Michael Orr – March 18, 2020

A number of people seem to assume that we are heading for a recession and that home prices will fall. The first assumption is quite reasonable. The second assumption is based on fear and has little analytical data to back it up. Obviously anything can happen in an uncertain and disrupted world, but a fall in home prices is still looking very unlikely from today’s numbers.

In 2005 the housing industry started to sicken because homes were being used as speculative commodities not for places to live. In 2005 I met a man in his early 20s who owned 12 homes in the Phoenix area, all with no occupants. How had he been able to buy them? 100% loans from unscrupulous lenders who went bust between 2007 and 2010. The housing industry (and more particularly the lending industry within it) was the cause of the 2008 recession. Phoenix was a hot spot for the cause of the problem, as was Las Vegas.

In 2020, housing is an innocent bystander to a probable recession caused by a pandemic. It has supply at extremely low levels and most homeowners have a large amount of equity. Even if they lost all their income and could no longer pay their mortgage, they could quickly find a buyer to release that equity. There is little likelihood of them facing foreclosure because the lender can be paid off with the sale proceeds. Only when demand collapses do the banks have to foreclose to get their money back. At the moment demand is still well above normal and has only shown very tiny signs of easing. In 2006 demand fell off a cliff yet home builders continued to build even more new homes because lenders continued to write ill-advised loans in huge numbers.

In 2020 builders are probably going to have to build fewer homes than they wish because of shortages of labor and materials. We are unlikely to see a glut of homes on the market for a very long time. A successful vaccine for the novel corona virus is more likely to appear before a surplus of homes could possibly develop.

Because the virus has not been contained yet, except in several parts of Southeast Asia, we are likely to see a lot of people out of work. We do not yet know how long it will take to get control of the pandemic in Arizona, but many people may be out of work for quite some time. These people are more likely to be renters rather than homeowners. Landlords may find it much harder to collect rents and the yields from their portfolios are likely to fall. Some may decide to evict tenants and sell their properties. At the moment the extra supply would be welcomed and receive multiple offers, even in these troubled times. The evicted tenants still exist and therefore still represent demand for shelter of some sort. There will be hardship, but not a flood of homes with no-one to live in them.

Housing demand is created by the existence of people and increases when more people turn up and decreases if they go away. In 2005 the people we were building new homes for were largely imaginary. In 2020 they are very real and migration trends have been very favorable with families and individuals moving to Arizona from other parts of the USA.

All the indicators for the Central Arizona housing market remain very healthy at the moment and we will report any change as soon as we spot one. There is no cause for panic and if you are delaying a purchase because you think the price will come down, you are probably making a poor decision.

Mike Orr

Cromford Report

www.cromfordreport.com

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 text602-980-0737

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

Legacy LEED® AP and designated SRES, Denise has a focus on healthy indoor environments and Aging/Chronic Illness. She is an affiliate of Seniors Advisors Advising Seniors®, a consortium of experts to surround and support families facing aging or ailments. To request a no-obligation market report, home evaluation, or consumer guide on your specific market, 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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February 2020 Luxury: the World Pre-COVID 19

The newest Luxury Market Report focuses on the Very-High Net Worth (VHNW) new generation of wealth. After 12 years of one of the best U.S. economies EVER, writers frequently write about all the new millionaires, especially in the Millennial generation, as a majority of Baby Boomers have already reached the age of retirement. It is the era of Zero percent interest, 2% very little unemployment, and a soaring stock market funding that huge population of retirees. And the newest work force happily rocking and rolling through a solid dozen years since the recession of 2005-2008.

My How Quickly Things Change!

Surely this most current issue of the Luxury Market Report will become a collector edition, reminding us how life was before the “new normal.” Just two weeks ago, on  February 29, I flew to a charity event in Ann Arbor. The flights were completely full, and no face masks to be seen during the 2,000 mile journey.  Two weeks later the monthly Luxury Market Report, compiled by the well-respected Institute for Luxury Home Marketing was posted.  

The Report painted a rosie picture of an amazing decade- long economic crescendo. Two weeks later the entire global economy was DECIMATED, with the stock market in a free fall. The publication, based necessarily on statistics from the prior month, was totally focused on a new generation of wealthy, defined as the Very-High Net Worth (VHNW). This group, whose net worth was valued between $5 – 30 million and considered 25% of all millionaire’s wealth. Now symbolizing the economic boom we all expected 2020 to be,

Full report can be found here www.AZMultipleListingService.com/LuxuryHomeReportFebruary2020

How Will This Play Out?

The 2020 Graduates will be missing their graduations as Social Distancing is making its way across the nation. The Federal Government is “thinking out loud” while all eyes are glued to the news within earshot. And no one knows exactly how serious this new coronavirus really is. Toilet paper hoarding is this week, what will it be next? This will be an interesting time for sure.

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