Area Real Estate News & Market Trends

You’ll find our blog to be a wealth of information, covering everything from local market statistics and home values to community happenings. That’s because we care about the community and want to help you find your place in it. Please reach out if you have any questions at all. We’d love to talk with you!

Aug. 8, 2018

Will the Housing Market Crash?

By Sonny Shrivastava

Yes, the housing market will crash. Eventually. If I had a nickel for every time someone asked me this question I'd be retired by now. If I had a crystal ball with which to answer that question I'd be the richest man in the world. Since neither are true, let's rely on the experts to see what they say…

Supply and Demand

According to a July report from CoreLogic, home prices continue to rise in Arizona and that situation will not change until we see more supply. We are in a perfect storm for rising home prices because there are more buyers than there are houses for them to buy. According to CoreLogic, home prices in Arizona have increased an average of 7.4% year-over-year.

Frank Martell, president and CEO of CoreLogic, said in a press release that even in the most expensive markets, nearly four times as many renters were looking to buy than homeowners were willing to sell. Across the country, 15% of homeowners and 28% of renters have shown a desire to buy a home during the next year, yet only 11% of homeowners have shown a desire to sell. Until these numbers reverse, prices will keep going through the roof.

National Home Price Change

Red Flags

The real estate market never crashes without warning signs. If you are concerned about the market, here are some key indicators you can follow:

  • Mortgage applications
  • Existing home sales
  • Unemployment rate
  • Consumer confidence

Mortgage Applications

According to CNBC, mortgage applications fell 17% from a year ago. Don't fret, however. They fault soaring prices as the reason behind the drop in mortgage applications. In other words, buyers are getting priced out of the market and are choosing to stay put. On its face this doesn't appear to be negative news for anyone except banks and mortgage brokers. If anything, this drop in mortgage applications is likely nothing more than a symptom of a hot market. If more buyers get out of the hunt, however, we could see the market start to cool.

Existing Home Sales

According to NAR—The National Association of Realtors®—existing home sales decreased for the third straight month in June. This report has been all over the news lately.

Reading the headlines, you'd think something terrible was happening. Don't panic! When look at the actual numbers, existing home sales are down only 2.2% from a year ago—in other words, nothing. Headlines are often misleading. When pressed, Lawrence Yun of NAR said,

“The root cause is without a doubt the severe housing shortage that is not releasing its grip on the nation’s housing market. What is for sale in most areas is going under contract very fast and in many cases, has multiple offers. This dynamic is keeping home price growth elevated, pricing out would-be buyers and ultimately slowing sales.”

While sales were 2.2% lower year-over-year nationally, median home price was up 5.2% in the same time period. June's national medial home price hit an all-time high at $276,900. The bottom line for NAR is the same as CoreLogic's—prices will continue to rise until more inventory comes online.

Unemployment Rate

Looking at the unemployment rate historically, it has been declining steadily since about 2013 and continues to hover around 4%. The trend line would indicate that we should expect to see only minor drops, if not a leveling. Regardless, this is great news. If unemployment starts creeping up, consumer buying power is reduced and fear starts to set in. If you see that happening, pay attention to the other indicators to paint a complete picture.


source: tradingeconomics.com

Consumer Confidence Index

The Consumer Confidence Index measures Americans' confidence in the economy. According to MarketWatch, this indicator hit an 18-year high in May. According to an economist at Barclays,

“Consumer confidence has remained resilient in recent months despite uncertainty stoked by anti-trade rhetoric and stock market volatility.” 

The high level of confidence reflects a sturdy economic expansion in the U.S. that’s about to turn nine years old with no end in sight. Job openings are at a record high and unemployment is at a 17-year low. This is all great news.

The Verdict?

Here we go with the crystal ball thing… If I had to wager money, I'd put my chips on the market staying healthy into the foreseeable future. The major indicators are all showing growth, confidence, and stability. The only softness we see is in demand fueled by buyers being priced out of their markets by quickly rising prices.

What is the worst thing I see happening? With fewer buyers due to affordability issues, we will see supply/demand reach more of an equilibrium. That means we could see appreciation retreat from its record high levels, but there is certainly nothing here that would indicate a "crash" or even a drop in home prices.

My Recommendation: If you are buying, get off the fence! The longer you wait, the less you will be able to afford due to rising home prices and rising interest rates. If you have an existing home to sell, use our free property valuation tool to get an idea of what it's worth.

Posted in Market Updates
Aug. 4, 2018

Buckeye 5th Fastest Growing City

By Sonny Shrivastava

Sienna Hills Community in BuckeyeBuckeye, Arizona is now the fifth fastest growing city in the country according to the U.S. Census Bureau. The 2017 list of the 15 fastest growing cities in the U.S. with populations of over 50,000 was released today. 

Buckeye was the only Arizona city to make the list, and moves up from the 7th fastest growing city last year.

The list shows from July 1, 2016 to July 1, 2017, Buckeye saw a 5.9 percent increase in population, reaching 68,453. City officials estimate the current population today at about 74,000.

“Buckeye provides an excellent quality of life for our residents,” said Buckeye Mayor Jackie Meck. “We offer the greatest value in housing along with a variety of outdoor recreational opportunities which creates the perfect environment to continue attracting new retail development and large employers to our great city.”  

In 2017, approximately 2,200 single family residential permits were issued in Buckeye, and the projection for 2018 is that at least 2,500 permits will be issued. 

Buckeye also provides excellent city services and events for residents. Our award winning Public Works Department, Skyline Regional Park and year-round family friendly events are just a few of the many benefits making Buckeye a great place to live, work and play.

Each year, the U.S. Census Bureau releases estimates of the population for the nation, states, counties and Puerto Rico. Annual estimates for resident populations are produced by measuring population change, which includes all people currently residing in the United States.

To learn more about living, working, playing or relocating your business to Buckeye, please visit www.growbuckeye.com.

Source: City of Buckeye

Posted in Market Updates
May 14, 2018

Getting Cash Back on New Construction

By Sonny Shrivastava

This is quite possibly the biggest secret in the business…

When you buy a new build, did you know that you can have a Realtor® negotiate on your behalf, review your contracts, represent your interests, and pay you an incentive? Every builder budgets at least 3% of the base price of the home as commission to a Realtor, whether there is one or not. If you don't have one, the builder keeps this money.

The builder's sales office represents the builder's interests, not yours. All of the salespeople are licensed Realtors®, which puts you at a disadvantage. Who looks out for you, to make sure the terms are fair, you aren't overpaying, and you don't lose your deposit over a technicality?

That's where we come in. In order to represent you, the builders require that we accompany you on your first visit to the sales office. When you fill out the builder's registration form, we also fill out a Realtor® registration form to ensure we can represent you. The builder pays us a commission, and in turn, we will give you back 1/3 of our commission (equal to 1% of the base price of the home).

How Do I Get My Rebate?

Step 1: We accompany you on your first visit to each builder as your Realtor®
Step 2: We negotiate a great deal on your new home
Step 3: At closing we will credit 1% of the base price towards your closing costs

At close of escrow, we will issue a credit from our commission equal to 1% of the base price of the home towards your closing costs. This effectively reduces the cash due at closing by the same amount, putting that cash back into your pocket.

VERY IMPORTANT—The builders require us to accompany and register you on your first visit to their sales office. They set the rules. Contact us before you visit the builder, otherwise we cannot represent you or pay the incentive.

The Sonny & Daniella Team Can Help

In such a competitive market, it's important to have the most updated information at your fingertips and the most experienced Realtors® at your side. We recently negotiated double the incentive for several of our new construction buyers, saving each of them tens of thousands of dollars above and beyond what they were able to negotiate by themselves.

Contact Sonny & Daniella today, or call (623) 824-4275, and let us help you get 1% cash back on your next new construction home!

Search New Builds in ScottsdaleSearch New Builds in MesaSearch New Builds in Goodyear-BuckeyeSearch New Builds in Peoria-GlendaleSearch New Builds in Surprise

Posted in Special Promotions
March 16, 2018

It's a Seller's Market!

By Sonny Shrivastava

Cromford Associates, publishers of the famed Cromford Report, has released its year-over-year market update. There is much for sellers to celebrate! Here are the key, valley-wide data points versus a year ago:

  • Inventory is down 14.2%
  • Median sales price is up almost 9%
  • Closed sales are up almost 9%
  • Months of supply is down from 3.6 months to 2.9 months

What Does it Mean?

Real estate prices are ruled by supply and demand. Inventory, or number of available homes for sale, is decreasing while the number of buyers vying for properties is increasing. Increased competition for fewer homes means higher prices. Median home prices are up almost 9% from a year ago.

Still On the Fence?

Get off and buy something! If you bought a $300,000 house a year ago, you would have $26,000 in equity today. If you were pre-qualified last year for $300,000, looked at some homes but did not buy anything, you could not afford to buy those homes today. A seller's market, unfortunately, means that buyers need to buy into the market or risk being priced out of the market.

The Sonny & Daniella Team Can Help

In such a competitive market, it's important to have the most updated information at your fingertips and the best Realtors® at your side. That's why our listing database is updated every 15 minutes, so you don't miss out on anything. We are also experienced negotiators and always get our buyers the lowest possible prices.

Contact us today and let us help you get your piece of the American Dream.

Cromford Report Real Estate Statistics for March

Posted in Market Updates
July 31, 2017

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We can definitely fill you in on details that are not listed on the report and help you determine the best home for you. If you are wondering if now is the time to sell, please try out our INSTANT home value tool. You’ll get an estimate on the value of your property in today’s market. Either way, we hope to hear from you soon as you get to know our neighborhoods and local real estate market better.

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