July 20, 2013

Metro Phoenix Housing¹ Market Snapshot
July 20, 2013
City Active Pending Sales DOM² Avg $/SF
Anthem 140 62 78 56 $119.71
Chandler 714 381 416 45 $128.28
Fountain Hills 188 37 36 123 $200.24
Gilbert 848 467 468 46 $118.27
Glendale 588 454 367 40 $103.09
Laveen 179 127 79 59 $77.50
Maricopa 427 220 161 72 $68.28
Mesa 1,196 628 591 48 $111.43
Peoria 595 347 303 47 $112.27
Phoenix 3,126 1,797 1,570 53 $119.73
Queen Creek 781 384 342 61 $83.77
Scottsdale 1,600 407 524 81 $201.46
Tempe 234 118 131 38 $132.02
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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Boomerang Buyers Are Staging a Comeback

Boomerang buyers —former home owners who have gone through a short sale, foreclosure, or bankruptcy in the past few years and are saving up for a down payment to purchase a home again—are coming back. They’re expected to flood markets in some of the hardest hit areas for short sales and foreclosures in the coming years. For example, boomerang buyers are predicted to account for nearly one in every five home sales in the metro Phoenix area this year—double the projected U.S. rate.

Rising rents and the desire to own again now that the economy is more stable are driving many boomerang buyers to re-enter the market. They also want to jump in before interest rates and home prices climb too much higher.

The following markets have the highest share of boomerang buyers:

  • Riverside-San Bernardino, Calif.: 4.1% (percentage of all U.S. boomerang buyers in 2013)
  • Los Angeles: 3.7%
  • Phoenix: 3.6%
  • Chicago: 2.5%
  • Atlanta: 2.4%
  • Las Vegas: 2.12%
  • Washington, D.C.: 2.1%
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Third Quarter 2013 Apartment Forecast – Phoenix metro

In the Southeast Valley, considerable growth in the tech sector at companies such as Intel and eBay has created strong demand for luxury rentals. Apartment construction is occurring at a rapid clip in Tempe, Chandler and Gilbert with nearly 3,300 units underway. The new units will outpace demand as the year progresses, softening occupancy rates and rent growth. In addition, rising home sales will also pose a challenge for operators as more renters consider homeownership ahead of a further rise in prices or interest rates this year. Private equity firms are active at the top end of the market with cap rates typically in the low- to mid-5 percent range.

  • Employment – 3.5% increase in total employment – In 2013, employment in the Phoenix metro will rise by 63,000 positions, or 3.5 percent. The education and health services, and financial sectors will each expand payrolls by more than 10,000 positions. During 2012, job growth reached 2.8 percent.
  • Construction – 3,223 units will be completed – A total of 3,223 units will be brought into service this year, reflecting a 1.1 percent gain in inventory. This includes more than 1,700 market-rate apartments. Last year 1,123 units were delivered.
  • Vacancy – 140 basis point decrease in vacancy – Greater renter demand will outpace the surge in inventory additions this year. As a result, vacancy will fall 140 basis points to 6.2 percent. The preceding year there was a 70-basis point fall.
  • Rent – 2.9% increase in effective rents – Improving occupancy will allow operators to raise rents. The average available effective rent will advance 2.9 percent in 2013 to $775 per month. Last year, rents moved up 2.0 percent.

Please not above are forecast for the apartment rental. If you are in the single family home rental, the Rent Check published by ARMLS will be your good reference. However, the apartment rental is competing with single family rental for tenants in many market. So, this information is good to know and to keep in mind when you are making your move of invest or listing rentals.

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July 13, 2013

Metro Phoenix Housing¹ Market Snapshot
July 13, 2013
City Active Pending Sales DOM² Avg $/SF
Anthem 140 62 79 58 $118.86
Chandler 698 384 436 47 $126.52
Fountain Hills 189 33 35 145 $209.60
Gilbert 824 492 455 48 $117.76
Glendale 552 458 392 42 $101.94
Laveen 161 130 80 67 $76.13
Maricopa 427 231 165 67 $68.52
Mesa 1,191 624 593 49 $111.63
Peoria 581 361 314 47 $112.49
Phoenix 3,068 1,843 1,546 53 $118.91
Queen Creek 769 386 344 59 $84.14
Scottsdale 1,596 425 540 84 $201.89
Tempe 222 126 130 44 $130.41
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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The Top 10 Largest Employers in Arizona

Does this list have anything to do with the housing market? You bet!

  1. State of Arizona – 49,278 employees
  2. Wal-Mart Stores, Inc. – 32,169 employees
  3. Banner Health – 25,270 employees
  4. City of Phoenix – 14,983 employees
  5. Wells Fargo – 14,718 employees
  6. Maricopa County – 12,698 employees
  7. Arizona State University – 12,222 employees
  8. Intel Corp. – 11,900 employees
  9. JPMorgan Chase & Co. – 11,042 employees
  10. Bank of America – 11,000 employees

This is how you would consider answering above question —

  • Is Chandler in a good proximity of above major employers?
  • Is any of above major employers based in Chandler?
  • How’s the outlook of these employers?
  • Do their employees get well paid?
  • Do they create business opportunities for others?

Now, go find out your answers and have a nice weekend!

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Phoenix Buyers Feel They Need to Act Soon or Risk Missing the Boat

Credit Suisse Monthly Agent Survey on Phoenix, AZ (11,859 single-family building permits in 2012, 3rd largest market in the country) housing market revealed the following —

  • June traffic levels came in strong relative to agents’ expectations for this time of year, as our index increased to 65 from 56 in May (above a neutral 50). Agents noted a growing sense among buyers that they will be priced out if they don’t act soon, especially as they continue to see a shortage of inventory.
  • Broad increases in home prices continued in June, as our home price index increased to 96 from 92 in May.
  • Inventory levels remain tight, and the time to sell continued to decline, which should continue to give sellers pricing power.

Some comments from local real estate agents —

  • The perception is that real estate is going up rapidly, which it is, and buyers need to purchase before prices exceed their purchasing power.
  • Slight increase in buyer interest in suburban locations.
  • Limited supply is creating a sense of urgency.
  • Slightly higher interest rates, but still affordable.
  • Low inventory continues to be an issue.
  • Buyers want to take advantage of low interest rates and to take advantage of still-low home prices.

What’s your take?

 

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July 6, 2013

Metro Phoenix Housing¹ Market Snapshot
July 6, 2013
City Active Pending Sales DOM² Avg $/SF
Anthem 129 56 87 58 $119.27
Chandler 658 383 466 48 $126.35
Fountain Hills 190 30 41 111 $211.41
Gilbert 807 476 500 47 $118.84
Glendale 536 468 411 45 $100.24
Laveen 160 124 83 64 $76.57
Maricopa 419 225 186 70 $66.53
Mesa 1,179 604 631 48 $110.40
Peoria 562 353 307 52 $112.13
Phoenix 3,036 1,802 1,644 53 $119.13
Queen Creek 739 411 380 65 $84.30
Scottsdale 1,589 433 557 90 $205.75
Tempe 225 120 131 44 $129.18
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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Cash Continues to Retreat from Phoenix Housing Market

Cash Buyers Pull Back and Financing Buyers Fill the Sales Gap

Cash purchases were 35% in May 2013 down 6 percent from May 2012 when they were 41%. The decrease in cash buyers was replaced by an increase in financing buyers. Conventional loan purchases were 40% in May 2013 compared to 36% in May 2012. And FHA and VA purchases in May 2013, were both up one percent over last year. As noted in our previous blog, in March 2013, for the first time since December 2008, more existing single family homes were purchased with conventional loans than with cash, ending 51 consecutive months of cash purchases reigning over conventional loan purchases.

May 2013 May 2012 Changes
Cash Purchase 35% 41% -6%
Conventional Loan 40% 36% +4%
FHA 19% 18% +1%
VA 5% 4% +1%
Other 1% 1% 0%
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June 2013

Metro Phoenix Housing Market Snapshot
June 30, 2013
All Area TODAY LAST MONTH LAST YEAR 2 YEARS AGO
6/30/2013 5/31/2013 6/30/2012 6/30/2011
Active listing  19,463 19,467 19,794 28,837
Pending Listing 8,892 9,662 10,197 12,224
Sales Per Month  8,229 9,227 8,133 10,346
Monthly Supply 2.2 2.3 2.4 3.0
Monthly Sales $/SF  $118.47 $120.08 $100.33 $82.84
Sale Price vs Listing Price  97.78% 97.26% 97.85% 96.26%
Listing Success Rate  79.10% 80.20% 78.50% 73.20%
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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