Monthly Archives: December 2012

Housing Market Intelligence

More Home Buyers Feel the Urgency

Home buyers are feeling more confident that the housing market is in recovery mode and they’re realizing they better act soon if they want to take advantage of low mortgage rates and home prices before they rise more.

Seventy percent (70%) of home buyers in 18 markets believe home prices will rise in their neighborhood within the next year, according to a new survey by Redfin of more than 1,000 home buyers.

In the first quarter of the year, only thirty percent (30%) of home buyers said they believed prices would rise in the next 12 months.

Fifty-seven percent (57%) of the survey respondents said that the record low mortgage rates were a main reason to purchase a home soon.

Meanwhile, nearly sixty percent (60%) of home buyers said their chief concern about purchasing a home was the smaller number of homes to choose from nowadays.

Redfin expects the 2013 home-buying season to kick off early in January 2013 with very strong demand, which, paired with low inventory, will cause prices to continue to rise steadily into spring.

The 18 markets participating in the survey were Atlanta, Austin, Baltimore, Boston, Chicago, Dallas, Denver, Los Angeles, New York, Orange County, Phoenix, Portland, Riverside/San Bernardino, Sacramento, San Diego, San Francisco, Seattle, and Washington.

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Property Management

Landlord Quick Tip – Decorating for the Holidays

It’s easy to get swept up into the “spirit of the holidays” but when that spirit includes holiday decorating on rental properties, landlords can quickly fall on a slippery slope when it comes to Fair Housing complaints.

Remember, religious beliefs are protected under anti-discrimination laws. What that means on a practical level is far from clear, but here are some tips to consider:

Religious discrimination rules distinguish between “common” areas like the leasing office, elevators or lobbies, and private residences.

In common areas, avoid overtly religious symbols, like nativity scenes and crucifixes. Courts have found other familiar holiday decor to be “religiously neutral” and therefore a safe bet for decorating. These includes trees, menorahs, Santas, candy canes, lights, and wreaths.

Don’t create the impression that one religion is favored over others. Someone entering  for the first time should not be able to pick up on a religious preference, and existing tenants should feel welcome to participate in any celebration or observance. For instance, if residents request equal exposure in holiday displays, include those symbols along with any others.

Within the private residence, allow tenants to display their personal religious symbols. That may include the outer face of their front door.

Call your lawyer if there is any doubt or question about what is appropriate. Fair Housing complaints are expensive to deal with, even if you win.

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Housing Market Intelligence

Grand Canyon University Possible $150M Expansion in East Valley

Grand Canyon University is planning to build 320,000 square feet cmpus in the East Valley that eventually will house 2,000 employees and 7,500 students. Initially, the campus will employ 1,000 people and double that by 2020. It will need anywhere from 75 to 150 acres for such expansion.

GCU issued request for proposals to Mesa, Tempe, Gilbert, Chandler and Queen Creek. Initial notices of intent are due Jan. 7, while full proposals are due Feb. 15. Already, one city has identified land for the expansion but it is too soon to identify the city. Personally, I don’t think Tempe has the capacity to offer such space in the already crowd city. Mesa’s mayor Smith is very determined to bring in higher education into the city of Mesa. So I believe there are in the talk. Chandler has become so expensive and the needs for higher education has been well served by nearby ASU East and Chandler-Gilbert Community College (CGCC). Not so sure either about Queen Creek since its high school system is yet ready to take on the cooperation with College.

With the up coming master plan of Eastmark in Mesa, resourceful pipelines of high schoolers and the aggressiveness major Smith has brought to his team, I highly anticipate GCU’s decision will favorable to Mesa. GCU expects to make a decision on the final location by May 2013, with an expected construction completion in fall 2014.

For more information, click here for Grand Canyon University – A for-profit Christian university located in Phoenix, Arizona.

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Weekly Housing Market Snapshot

December 22, 2012

Metro Phoenix Housing¹ Market Snapshot
December 22, 2012
City Active Pending Sales DOM² Avg $/SF
Anthem 150 53 63 66 $106.37
Chandler 716 400 324 52 $119.01
Fountain Hills 220 45 37 128 $171.15
Gilbert 797 528 376 56 $105.88
Glendale 686 468 279 41 $87.85
Laveen 163 136 76 60 $69.09
Maricopa 607 201 116 64 $63.82
Mesa 1,204 725 514 64 $100.47
Phoenix 3,423 1,952 1,357 60 $103.63
Queen Creek 957 432 284 65 $75.66
Scottsdale 1,772 417 407 77 $196.68
Tempe 248 135 104 50 $119.27
Note¹ – Housing = Single Family Homes, Note² – DOM = Days On Market
Data Source: Arizona Regional Multiple Listing Service (ARMLS)
For other cities or area, please call (480)292-8281 or email gchen@az-realty.com
Above data was compiled by Gary Chen, Associate Broker, ABR, CIAS, CNE, SFR
Original data complied by The Cromford Report
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Property Management

7 Property Management Mistakes To Avoid

Whether you hire someone to manage your investment property or do-it-yourself, there are some key property management mistakes you want to avoid.

Sometimes being penny wise is being dollar foolish. Owning property is a long-term investment with the building, the land and the tenant so planning ahead is important.

Here are some tips to help you along the way:

1. Screen and Interview Tenants. Do your due diligence, have the tenant fill out a rental application, collect the fee for a credit report, criminal background check and call to confirm employment. Remember when doing your tenant background check, fair housing laws require that what you do for one you do for all, be consistent. And get a copy of the ID to make sure you know who you are dealing with.

2. Hiring New Contractors Every Time is a Big No-No. You want to create a relationship with the local contractors where when you have a problem you call them and it gets done. Shopping around for the best price all the time will just cause you headaches and more time in the long run. So find someone local that has been in business for a while and knows what they are doing, create a relationship and stick with them.

3. Hiring Unskilled Workers to Save Money. This will just come back to haunt you. They probably have no insurance, no or little experience, no guarantee on work done. On top of all this no background check, who knows who you are hiring, this could be a huge safety issue.

4. Letting Tenants Do Their Own Maintenance or Repairs. This is almost as bad as hiring unskilled workers, it might seem like an easy way out but this could lead to further damages, more repairs and you could be liable for damages or injuries.

5. Failing to Do Routine Inspection and Repair. Owning property has a lot to do with preventative maintenance. In the short term it will cost a little and in the long term save you much. Routine inspections can help you spot problems before they become huge and shows the tenant that you care. Depending on the age of the property you can do yearly inspections, bi-annually or quarterly.

6. Communicate with the Tenant. You need to keep open communication with the tenant; e-mail is the best since it is documented. If you have any concerns you reach out, if there are any problems tell the tenant to let you know ASAP. This will create a sound landlord-tenant relationship.

7. Do Not Wait Until the Last Moment to Renew the Lease. Talk to your tenant 60 to 90 days before the end of the lease to see what their plans are. Also communicate if there will be an increase of rent and if so why. Remember this is a two way street where you want it to be a win-win for both parties.

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Housing Market Intelligence

A Future Landmark For Phoenix?

A Danish architecture firm and an Arizona real estate developer are proposing a 420-foot modernistic observation tower that would be located in downtown Phoenix and billed as a tourist destination.

That would make the tower close to 39 stories and the tallest building in Arizona.

Bjark Ingels Group (BIG) designed the proposed Phoenix Observation Tower. Novawest LLC owns real estate in Phoenix and wants to locate the tower near the Arizona Science Center, Phoenix Convention Center and US Airways Center.

“This is the right place and the right time for a signature project for downtown Phoenix and we knew the design needed to be something extraordinary. Big has delivered something exceptional, blending form and function in a way that will change the local skyline forever and will give visitors a once-in-a-lifetime experience.” said Brian Stowell, a Novawest principal. Phoenix New LandmarkThe architecture firm unveiled the tower plans Wednesday evening. The tower includes an open-air spiral sphere at the top and could also include restaurants and special event space.

Novawest wants to locate the modern structure near the Arizona Science Center or the corner of 6th and Adams streets at the southwest edge of Heritage Square in Phoenix.

The BIG architecture firm specializes in a variety of unique designs and structures. It has designed buildings in France, Norway, Iceland, Denmark, Germany, Abu Dhabi and Taiwan.

Click here for the future Phoenix landmark.

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Housing Market Intelligence

Metro Phoenix Top Nationwide Overall Performance – December 2012

With the shining performance of Employment (6th), Unemployment (26th), Output (GDP) (3rd) and House Prices (1st), metro Phoenix proudly stands on the 3rd position among nation’s top 100 metro areas.

Phoenix led the West region and much of the nation with swift job growth of 0.8 percent over the quarter. Phoenix also has rebounded steadily with cumulative job growth of 4.5 percent.

The unemployment rate declines 0.4 percentage points in Phoenix and stood below 7.0 percent. Over the course of recovery, unemployment rate has fallen from the peak most swiftly in Arizona.

Output continued to recover in the metro Phoenix during the third quarter and the rate of expansion increased. Arizona metros led the region’s output growth with surges of 1.3 percent in Phoenix and 1.8 percent in Tucson over the quarter.

Increases in the House Price Index over the quarter a heady 4.6 percent in Phoenix – the largest increase in the country. Phoenix leads the West region in terms of overall house price recovery as well.

For more information, please click here.

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Housing Market Intelligence, Property Management

Arizona Ranks 3rd Among State-To-State Moves in 2011

The Most Common State-to-State Moves

Census Bureau just released state-to-state migration flow tables with 2011 American Community Survey estimates. The American Community Survey provides demographic, social, economic and housing statistics, including geographical mobility for every community across the nation every year.

U.S. Migration Map 2010 - 2011

The most common state-to-state moves in 2011 were:

  • New York to Florida: 59,288 movers
  • California to Texas: 58,992
  • California to Arizona: 49,635
  • Florida to Georgia: 42,666
  • New Jersey to New York: 41,450
  • New York to New Jersey: 40,815
  • California to Nevada: 40,114
  • Georgia to Florida: 38,658
  • California to Washington: 38,421
  • Texas to California: 37,087
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Housing Market Intelligence

More Real Estate Pros Optimistic About Home Values

More real estate professionals are optimistic about the direction of home prices, according to a fourth-quarter survey by HomeGain of more than 200 practitioners and brokers nationwide.

Sixty-five percent of real estate professionals say they expect home values to rise in the next six months, up from 51 percent in the previous quarter.  In the fourth quarter of 2011, only 15 percent of practitioners said they expected home prices to rise.

“We are seeing a continued increase in optimism about the direction of home prices,” says Louis Cammarosano, general manager of HomeGain. “Real estate agents expect the recent pick up in the real estate market to continue in the coming two years.”

Indeed, the optimism in home values increases even more the further the outlook: Seventy-nine percent of real estate professionals and 62 percent of home owners say home values will likely increase in the next two years, according to the survey. Eleven percent of real estate practitioners say they expect home values to fall in the next six months.

Here are the 10 states where real estate professionals are most confident about rising home prices over the next six months:

  1. Idaho
  2. Michigan
  3. Arizona
  4. Texas
  5. Indiana
  6. California
  7. Florida
  8. Virginia
  9. North Carolina
  10. Colorado

The following are the top states where homeowner confidence about home values over the next six months is highest:

  1. Arizona
  2. Nevada
  3. Texas
  4. Colorado
  5. Wisconsin
  6. Washington
  7. Michigan
  8. Virginia
  9. Massachusetts
  10. Tennessee
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Property Management

Landlord Quick Tip – Are You Liable If Tenant’s Friend Injured?

The answer is YES.

Most landlords are careful who they rent to, but it’s harder to manage a tenant’s guests. If those guests cause problems, like damaging the property or disturbing — even harming — other tenants, or if that guest is injured, the landlord often is the first to be blamed.

Give your guest policy a one-two punch:

First, make sure you have a provision in your lease that makes it clear the tenant — not the landlord — is liable for the actions of unruly guests.  This provision is often placed in the termination clause, allowing the landlord to evict a tenant who befriends the wrong people.  The guest must be required to follow all of the same house rules that tenants must follow.

Next, consider asking your tenants to carry renters insurance.  A special liability rider can be purchased which may pay if a tenant’s actions cause a guest’s injury.  With such a policy in place, the landlord becomes an unlikely target for a lawsuit.

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