NEWS YOU CAN USE
Despite talk, there’s no sign of metro Phoenix housing bubble
The dreaded term “housing bubble” has crept back into conversations about real-estate markets with big increases in home values, including metro Phoenix.
The phrase, used to describe the housing boom and bust of 2005-11, conveys a looming sense of doom, particularly among those who owned a house when the bubble burst the last time.
Like most Valley homeowners, I saw my home’s value jump more than 50 percent in two years and then fall twice as much during the subsequent five-year crash.
But when I hear the housing bubble tag attached to the Phoenix-area housing market now, I feel more skepticism than dread.
So do the experts I asked this week about the potential for another Phoenix-area housing bubble.
A recent Realtor.com report talking about a potential housing bubble found home prices in 31 of the U.S.’s 50 biggest housing markets have recovered to boom levels or even higher.
Metro Phoenix’s market isn’t one of them.
“The Valley’s median home price is hovering around $245,000, and that’s still 93 percent of peak prices during the boom,” said Tina Tamboer, senior housing analyst with the Cromford Report.
Compared with 2004-06, when Phoenix-area home prices shot up more than 50 percent, the climb back has been much slower.
“It’s taken us six years to get where we are with prices now, and we still aren’t fully recovered,” she said.
Tom Ruff, housing analyst for the Information Market, which is owned by the Arizona Regional Multiple Listing Service, said the Valley’s housing market isn’t being driven by speculators and bad loans as it was during the boom.
In some of metro Phoenix’s most popular neighborhoods and more affordable areas, demand is ahead of supply, so prices are climbing faster, he said.
That is leading some to be concerned about “micro bubbles” in those Valley hot spots across central Phoenix, south Scottsdale and downtown Tempe, Ruff said.
But he isn’t seeing it. Since Ruff, with Mike Orr of Cromford, called the month of the peak of the boom (September 2006) and the bottom of the crash (September 2011), I believe him.
Courtesy of Catherine Reagor, The Republic
Goodyear approves incentives for Chewy center, 700 jobs
The Goodyear City Council approved a $910,000 incentive package Dec. 11 for a 700-job distribution center for Chewy Inc.
Chewy is an online pet product retailer locating a 802,671-square-foot distribution center in Goodyear. Chewy is owned by Phoenix-based PetSmart.
The center is on a 49-acre site near Van Buren Street, 143rd Avenue and Interstate 10.
“We are thrilled to announce that Chewy, Inc. has chosen Goodyear as the location for their internet fulfillment center. E-commerce will continue to be a significant driver of our nation’s economy, and Goodyear is proud to be home to an innovative company like Chewy Inc.,” said Goodyear Mayor Georgia Lord.
Goodyear is home to big distribution centers for Macy’s (NYSE: M) and Amazon.com (Nasadq: AMZN). The Goodyear incentives for Chewy includes waiving development fees.
United Parcel Services (NYSE: UPS) and German grocer Aldi also are locating distribution hubs in Goodyear.
“We’re excited to further expand Chewy fulfillment operations to Arizona, our first in the state and seventh in the country. We greatly appreciate the partnership with the city of Goodyear and look forward to investing in the local community with the creation of 700 new jobs,” said Ryan Cohen, co-founder and CEO of Chewy Inc.
Arizona Commerce Authority President and CEO Sandra Watson also welcomed Chewy landing in the West Valley.
“Arizona offers the depth of talent a growing company like Chewy Inc. requires, and our geographic position provides the ideal location for the company to easily serve its customers in key markets around the world,” Watson said.
Courtesy of Mike Sunnucks Senior Reporter, Phoenix Business Journal
What makes Markets Rise and Fall
In today’s real estate market, where inventory is sparse, homebuyers and sellers alike do well to understand the concept of home value appreciation.
Unlike the purchase of a car, that loses value (or depreciates) when you drive it off the lot, the value of your home may increase (or appreciate) over time. Appreciation is based on several factors – some within the homebuyer’s control, other factors…not so much.
Where is as important as what
You’ve heard it before, and we’ll say it again: Location, Location, Location. Where you purchase your home may be the most important (controllable) factor to appreciation.
If value appreciation is important to you, be sure to give thought to where – in the country, state, city, community, and neighborhood – you buy. According to Forbes, the southern half of the U.S. is the best place to invest in housing in 2017, whether you’re looking for your family home or a rental property.
Other things to consider when purchasing as it relates to location: Is the home close to major highways? Are good schools nearby? Is it conveniently located to entertainment and shopping? Is there a nice view?
Investing in a desirable area may contribute to equity in your home down the line and could mean more money in your pocket if you decide to sell.
Another factor to consider is how much you buy. We’re talking land, though, not the physical structure of your home. Why? It’s pretty simple: supply vs. demand. Land is a limited commodity; we’re not getting any more of it. As the world’s population increases, so does its need for land.
If your budget doesn’t allow for both a large, fabulous home and a considerable piece of land, you may wish to consider opting for a more conservative home and keep the land.
The upside of upkeep
Finally, take care of your home. If it breaks, fix it. If it’s outdated, upgrade it. While it may not be as large a factor as the location and land itself, having a well-maintained home with attractive details and modern-day features may increase the equity of your home (and help it sell faster when you’re ready!)
Giving thought to how your home will appreciate is the smart thing to do; however, the reality is that appreciation rates vary based on factors beyond the homebuyer’s control.
The economy (global, national and local) affects the real estate market, which affects what your home is worth at any given time. Again, it’s a matter of supply vs. demand.
In a nutshell: the more people can afford to buy houses, the greater the demand becomes for houses, making home values rise
Timing is almost everything
If you’re shopping for a home right now, you know it’s a seller’s market. In some areas, a home could be under contract within days, sometimes hours. This trend has had a positive impact on home values across the U.S.
As of May 2017, Zillow reports a national home value index of $199,200 – up .5% from April 2017 and 7.4% from 2016. Translation: Sellers have a good chance of getting the most ‘bang’ for their real estate ‘buck’ in the current environment.
If you’re in the market to sell, please give me a call to see what your home is currently worth. And if you’re the conscientious consumer, pay attention to national forecast to maximize your investment.
Courtesy of Danielle Flynn, Movement blog contributor
Choosing paint finishes to highlight your home
A new coat of paint can be just the trick to refresh your surroundings and give your home a whole new feel.
While there are probably a million different paint colors available, when you’re decorating the inside of your home, there are really only five “finishes” or sheens to choose from. Each has its own features, centered around two main traits: durability and ease of cleaning
High gloss: This paint is super easy to clean and shiny, reflecting light and opening up small spaces. It’s good for highlighting trim, railings, and architectural features or for “special” rooms like a formal dining room. The colors look deep and rich (great for dark and jewel tones!), but gloss shows every flaw on the painted surface. Often expensive to buy, high gloss may need primer, lots of sanding and many coats to look good.
Semi-gloss: Like high gloss, semi-gloss is long-lasting and washable. It stands up well to moisture, making this finish ideal for bathrooms, kitchens, and areas that frequently need to be cleaned. Satin: Satin is the most popular finish by far, good for light colors and large areas. This finish is pretty easy to clean with a damp cloth (although not actually scrubbable), so choose it for kids’ rooms, laundry rooms, and high-traffic areas. Caution: Brush or roller strokes will be visible if not put on smoothly and evenly.
Eggshell: This finish only has a bit of shine to it, meaning it covers up flaws pretty well. While somewhat stain resistant, eggshell is not very easy to clean and it can mark easily, so it’s not a good choice for areas where lots of kid activities take place; use it for bedrooms, hallways, and lower-traffic areas.
Flat or matte: This sheen has no shine at all, which means it absorbs light and hides flaws, making walls look smooth (even when they may not be), so it’s good for textured surfaces. Flat paint shows every scuff and fingerprint; cleaning the wall can actually remove or damage paint, so touch-ups are really the only way to cover marks and scuffs. Flat finishes are good for dining rooms, adult bedrooms, ceilings, and other areas that won’t get lots of fingerprints.
Exterior paint comes in mostly the same finishes as interior paint. As with the inside, lower-sheen flat and satin paints are better for walls, while semi- and high-gloss finishes are great for trim, shutters, and doors. The shinier paints should be applied in multiple thin layers for the best effect.
Be sure to check with your local paint store for more information on paints such as tinted primer, no-fade paint, stains, oils and acrylics, and other specialty paint features that can also enhance your painting project. No matter where in (or on) your home you’re ready for a new look, choosing the right paint is the best way to get started.
Home Staging Basics for Clients
clutter. For example, adding new bedding and accessories as well as accent pillows and flowers can perk up rooms with color and excitement. Shelves can be styled with books and interesting objects; and artwork can be displayed throughout the house.
6 Ways to Spruce Up a Home With Staging
Studies have suggested that staged homes sell faster, and as such, more sellers may be willing to give it a try.
So what are some staging ideas for sprucing up a property? Thomas Rouse, a design producer at “Extreme Makeover: Home Edition,” offered the following tips in a recent article in The Wall Street Journal.
1. Paint: A fresh coat of paint in a neutral palette can be an inexpensive upgrade with big impact.
2. Have furniture but don’t clutter: Don’t leave rooms empty because potential buyers may struggle to visualize what all you can do with the space. Also, Rouse suggests avoiding furniture with patterns, which can be distracting.
3. TV artwork: Mount a flat-screen TV to a wall and have a slideshow playing on it with images of nature, Rouse suggests.
4. Fill the walls: Don’t leave walls bare, which can make a home feel cold, according to Rouse. Hang photography, framed artwork, and mirrors to spice up the walls.
5. Flower displays: Have fresh-cut flowers in simple glass vases displayed on the dining room table and in other places in the home to bring more life to a space, Rouse says.
6. Gender-neutral bedrooms: Keep bedroom colors neutral and have simple bedding — preferably in white — to make a room feel fresh, Rouse says.
Source: “Set the Stage for a Faster Home Sale,” The Wall Street Journal (May 26, 2012)
Rents continue to Rise
Phoenix rents increased by little more than half a percent in the past month, but rent prices have gone up more than 5 percent in the past year, according to Apartment List’s April 2017 Phoenix Rent Report.
In Phoenix, one-bedroom apartments have a median rent of $870, and two-bedrooms go for closer to $1,300, according to the report.
“Phoenix renters are relatively satisfied with the city overall,” says Andrew Woo, Director of Data Science at Apartment List. “Most renters gave average or above average scores across the board.”
Scottsdale rent continues to run the highest in Arizona — median rent for a one-bedroom apartment is $1,300 and $2,400 for two bedrooms.
Rents in Scottsdale have gone down 2.2 percent in the past year.
Glendale, however, shows the fastest-growing rents, with prices up 6 percent from a year ago and the highest year-over-year rent growth in the state. One bedroom there goes for a median of $910 in rent, while two-bedroom apartments run at $870.