Don’t Believe Everything You Read About Home Prices in Phoenix

Don’t Believe Everything You Read About Home Prices

According to the latest data from Fannie Mae, 23% of Americans still think home prices will go down over the next twelve months. But why do roughly 1 in 4 people feel that way?

It has a lot to do with all the negative talk about home prices over the past year. Since late 2022, the media has created a lot of fear about a price crash and those concerns are still lingering. You may be hearing people in your own life saying they’re worried about home prices or see on social media that some influencers are saying prices are going to come tumbling down.

If you’re someone who still thinks prices are going to fall, ask yourself this: Which is a more reliable place to get your information – clickbait headlines and social media or a trusted expert on the housing market?

The answer is simple. Listen to the professionals who specialize in residential real estate.

Here’s the latest data you can actually trust. Housing market experts acknowledge that nationally, prices did dip down slightly late last year, but that was short-lived. Data shows prices have already rebounded this year after that slight decline in 2022 (see graph below):

But it’s not just Fannie Mae that’s reporting this bounce back. Experts from across the industry are showing it in their data too. And that’s why so many forecasts now project home prices will net positive this year – not negative. The graph below helps prove this point with the latest forecasts from each organization:

What’s worth noting is that, just a few short weeks ago, the Fannie Mae forecast was for 3.9% appreciation in 2023. In the forecast that just came out, that projection was updated from 3.9% to 6.7% for the year. This increase goes to show just how confident experts are that home prices will net positive this year.

So, if you believe home prices are falling, it may be time to get your insights from the experts instead – and they’re saying prices aren’t falling, they’re climbing.

Bottom Line

There’s been a lot of misleading information about home prices over the past year. And that’s still having an impact on how people are feeling about the housing market today. But it’s best not to believe everything you hear or read.

 

If you want information you can trust, turn to the real estate experts. Their data shows home prices are on the way back up and will net positive for the year. If you have questions about what’s happening in our local area, let’s connect.

These Top Cities Show Home Prices Are Still Climbing

These Top Cities Show Home Prices Are Still Climbing

If you’re considering buying a home or selling your current one to find something that better suits your needs, you may have questions about what’s happening with home prices today. Here’s what you need to know.

There’s still a lot of confusion and misinformation out there. So, no matter what you may have heard, the national data shows they’ve actually been climbing again (see graphs below):

As you can see, in the first half of 2022, home prices went way up. Those increases were dramatic and unsustainable. So, in the second half of 2022, prices adjusted. Those dips were small and didn’t last very long. Still, the news made a big deal about these slight declines, which may have made you worry.

But what’s important to know is that, in 2023, prices are going up again, and this time it’s at a more normal pace. The fact that all three reports now show more typical price increases this year is good news for the housing market.

Home Prices Are Rising Across the Top Cities in the U.S.

After seeing steady home price growth at the national level for the last several months, you may wonder if prices are going up in your local area, too. Know this: while this will vary from one area to the next, home prices are appreciating in these top cities Case-Shiller reports on in their monthly price index (see chart below):

That’s why so many experts are able to forecast home prices will end the year in the positive and continue going up in 2024.

Here’s How This Affects You

  • For Buyers: If you’ve been waiting to buy a home because you were concerned it might lose value, the fact that home prices are going up should ease your worries. Buying a home before prices climb higher can be a smart move since home values typically appreciate over time.
  • For Sellers: If you’ve been postponing selling your house because you were worried about how changing home prices would affect its value, now might be a good time to work with a real estate agent to put your house on the market. You don’t have to wait any longer because the data shows home prices are in your favor.

Bottom Line

If you delayed moving because you were concerned home prices would drop, don’t worry – the numbers show they’re going up nationally. To better understand how home prices are changing in your local area, let’s connect.

Forecasting Year-End Home Prices in California and Arizona

Forecasting Year-End Home Prices

Let’s connect so you know what’s going on with home prices in our local area.

Reasons To Sell Your House Before the New Year in Scottsdale

Reasons To Sell Your House Before the New Year

As the year winds down, you may have decided it’s time to make a move and put your house on the market. But should you sell now or wait until January? While it may be tempting to hold off until after the holidays, here are three reasons to make your move before the new year.

Get One Step Ahead of Other Sellers

Typically, in the residential real estate market, homeowners are less likely to list their houses toward the end of the year. That’s because people get busy around the holidays and sometimes deprioritize selling their house until the start of the new year when their schedules and social calendars calm down. But that gives you an opportunity to get one step ahead.

Selling now, while other homeowners may hold off until after the holidays, can help you get a leg up on your competition. Start the process with a real estate agent today so you can get your house on the market before your neighbors do.

Get Your House in Front of Eager Buyers 

Even though the supply of homes for sale did grow compared to last year, it’s still low. That means there aren’t enough homes on the market today. While some buyers may also delay their plans to move until January, others will still need to move for personal reasons or because something in their life has changed.

Those buyers are still going to be active later this year and will be seriously motivated to make their move happen because they need to. Unfortunately, the challenge they’ll face is a shortage of available inventory to meet their needs. A recent article from Investopedia says:

“. . . if your house is up for sale in the winter and someone is looking at it, chances are that person is serious and ready to buy. Anyone shopping for a new home between Thanksgiving and New Year’s is likely going to be a serious buyer. Putting your home on the market at this time of year and attracting a serious buyer can often result in a quicker sale.”

Use Your Equity To Fuel Your Move

Keep in mind that homeowners today have record amounts of equity. According to CoreLogic, the average amount of equity per mortgage holder has climbed to almost $290,000. That means the equity you have in your house right now could cover some, if not all, of a down payment on the home of your dreams.

And as you weigh the reasons to sell before year-end, it’s important to remember the reasons that sparked your desire to move in the first place. Maybe it’s time for a new home in a location that suits you better, one that offers the perfect space for you and your loved ones, or maybe your needs have evolved over time. A local real estate agent can help you determine how much home equity you have and how you can use it to achieve your goal of making a move.

Bottom Line

Listing your home before the new year can offer unique benefits. Less competition, motivated buyers, and your equity gains can all play to your advantage. Reach out, and let’s achieve your goals before winter sets in.

Are More Homes Coming onto the Market in Phoenix?

Are More Homes Coming onto the Market?

An important factor shaping today’s market is the number of homes for sale. And, if you’re considering whether or not to list your house, that’s one of the biggest advantages you have right now. When housing inventory is this low, your house will stand out, especially if it’s priced right.

But there are some early signs that more listings are coming. According to the latest data, new listings (homeowners who just put their house up for sale) are trending up. Here’s a look at why this is noteworthy and what it may mean for you.

More Homes Are Coming onto the Market than Usual

It’s well known that the busiest time in the housing market each year is the spring buying season. That’s why there’s a predictable increase in the volume of newly listed homes throughout the first half of the year. Sellers are anticipating this and ramping up for the months when buyers are most active. But, as the school year kicks off and as the holidays approach, the market cools. It’s what’s expected.

But here’s what’s surprising. Based on the latest data from Realtor.com, there’s an increase in the number of sellers listing their houses later this year than usual. A peak this late in the year isn’t typical. You can see both the normal seasonal trend and the unusual August in the graph below:As Realtor.com explains:

“While inventory continues to be in short supply, August witnessed an unusual uptick in newly listed homes compared to July, hopefully signaling a return in seller activity heading toward the fall season . . .”

While this is only one month of data, it’s unusual enough to note. It’s still too early to say for sure if this trend will continue, but it’s something you’ll want to stay ahead of if it does.

What This Means for You

If you’ve been putting off selling your house, now may be the sweet spot to make your move. That’s because, if this trend continues, you’ll have more competition the longer you wait. And if your neighbor puts their house up for sale too, it means you may have to share buyers’ attention with that other homeowner. If you sell now, you can beat your neighbors to the punch.

But, even with more homes coming onto the market, the market is still well below normal supply levels. And, that inventory deficit isn’t going to be reversed overnight. The graph below helps put this into context, so you can see the opportunity you still have now: 

Bottom Line

Even though inventory is still low, you don’t want to wait for more competition to pop up in your neighborhood. You still have an incredible opportunity if you sell your house today. Let’s connect to explore the benefits of selling now before more homes come to the market.

Planning to Retire? Your Equity Can Help You Make a Move To Phoenix, AZ

Planning to Retire? Your Equity Can Help You Make a Move To Phoenix, AZ

 

Reaching retirement is a significant milestone in life, bringing with it a lot of change and new opportunities. As the door to this exciting chapter opens, one thing you may be considering is selling your house and finding a home better suited for your evolving needs.

Fortunately, you may be in a better position to make a move than you realize. Here are a few reasons why.

Consider How Long You’ve Been in Your Home

From 1985 to 2009, the average length of time homeowners stayed in their homes was roughly six years. But according to the National Association of Realtors (NAR), that number is higher today. Since 2010, the average home tenure is just over nine years (see graph below):

This means many homeowners have been living in their houses even longer in recent years. When you live in a home for such a significant amount of time, it’s natural for you to experience changes in your life while you’re in that house. As those life changes and milestones happen, your needs may change. And if your current home no longer meets them, you may have better options waiting for you.

Consider the Equity You’ve Gained

And, if you’ve been in your home for more than a few years, you’ve likely built-up substantial equity that can fuel your next move. That’s because you gain equity as you pay down your loan and as home prices appreciate. And, the longer you’ve been in your home, the more you may have gained. Data from the Federal Housing Finance Agency (FHFA) illustrates that point (see graph below):

While home prices vary by area, the national average shows the typical homeowner who’s been in their house for five years saw it increase in value by nearly 60%. And the average homeowner who’s owned their home for 30 years saw it almost triple in value over that time.

Whether you’re looking to downsize, relocate to a dream destination, or move so you live closer to friends or loved ones, that equity can help. Whatever your home goals are, a trusted real estate agent can work with you to find the best option. They’ll help you sell your current house and guide you as you buy the home that’s right for you and your lifestyle today.

Bottom Line

As you plan for your retirement, let’s connect so we can find out how much equity you’ve built up over the years and plan how you can use it toward the purchase of a home that fits your changing needs.

Why You Don’t Need To Fear the Return of Adjustable-Rate Mortgages In Phoenix, Arizona

Why You Don’t Need To Fear the Return of Adjustable-Rate Mortgages IN PHOENix, Arizona

If you remember the housing crash back in 2008, you may recall just how popular adjustable-rate mortgages (ARMs) were back then. And after years of being virtually nonexistent, more people are once again using ARMs when buying a home. Let’s break down why that’s happening and why this isn’t cause for concern.

Why ARMs Have Gained Popularity More Recently

This graph uses data from the Mortgage Bankers Association (MBA) to show how the percentage of adjustable-rate mortgages has increased over the past few years:

As the graph conveys, after hovering around 3% of all mortgages in 2021, many more homeowners turned to adjustable-rate mortgages again last year. There’s a simple explanation for that increase. Last year is when mortgage rates climbed dramatically. With higher borrowing costs, some homeowners decided to take out this type of loan because traditional borrowing costs were high, and an ARM gave them a lower rate.

Why Today’s ARMs Aren’t Like the Ones in 2008

To put things into perspective, let’s remember these aren’t like the ARMs that became popular leading up to 2008. Part of what caused the housing crash was loose lending standards. Back then, when a buyer got an ARM, banks and lenders didn’t require proof of their employment, assets, income, etc. Basically, people were getting loans that they shouldn’t have been awarded. This set many homeowners up for trouble because they couldn’t pay back the loans that they never had to qualify for in the first place.

This time around, lending standards are different. Banks and lenders learned from the crash, and now they verify income, assets, employment, and more. This means today’s buyers actually have to qualify for their loans and show they’ll be able to repay them.

Archana Pradhan, Economist at CoreLogic, explains the difference between then and now:

“Around 60% of Adjustable-Rate Mortgages (ARM) that were originated in 2007 were low- or no-documentation loans . . . Similarly, in 2005, 29% of ARM borrowers had credit scores below 640 . . . Currently, almost all conventional loans, including both ARMs and Fixed-Rate Mortgages, require full documentation, are amortized, and are made to borrowers with credit scores above 640.”

In simple terms, Laurie Goodman at Urban Institute helps drive this point home by saying:

“Today’s Adjustable-Rate Mortgages are no riskier than other mortgage products and their lower monthly payments could increase access to homeownership for more potential buyers.”

Bottom Line

If you’re worried today’s adjustable-rate mortgages are like the ones from the housing crash, rest assured, things are different this time.

 

And, if you’re a first-time homebuyer and you’d like to learn more about lending options that could help you overcome today’s affordability challenges, reach out to a trusted lender.

Tips for Making Your Best Offer on a Home In Phoenix, AZ

Tips for Making Your Best Offer on a Home IN PHOENIX, AZ

 

While the wild ride that was the ‘unicorn’ years of housing is behind us, today’s market is still competitive in many areas because the supply of homes for sale is still low. If you’re looking to buy a home this season, know that the peak frenzy of bidding wars is in the rearview mirror, but you may still come up against some multiple-offer scenarios.

Here are a few things to consider to help you put your best foot forward when making an offer on a home.

1. Lean on a Real Estate Professional

Rely on an agent who can support your goals and help you understand what’s happening in today’s housing market. Agents are experts in the local market and on the national trends too. They’ll use both of those areas of expertise to make sure you have all the information you need to move with confidence.

Plus, they know what’s worked for other buyers in your area and what sellers may be looking for in an offer. It may seem simple, but catering to what a seller needs can help your offer stand out. As an article from Forbes says:

“Getting to know a local realtor where you’re hoping to buy can also potentially give you a crucial edge in a tight housing market.”

2. Get Pre-Approved for a Home Loan

Having a clear budget in mind is especially important right now given the current affordability challenges. The best way to get a clear picture of what you can borrow is to work with a lender so you can get pre-approved for a home loan.

That’ll help you be more financially confident because you’ll have a better understanding of your numbers. It shows sellers you’re serious, too. And that can give you a competitive edge if you do get into a multiple-offer scenario.

3. Make a Fair Offer

It’s only natural to want the best deal you can get on a home. However, submitting an offer that’s too low does have some risks. You don’t want to make an offer that will be tossed out as soon as it’s received just to see if it sticks. As Realtor.com explains:

“. . . an offer price that’s significantly lower than the listing price, is often rejected by sellers who feel insulted . . . Most listing agents try to get their sellers to at least enter negotiations with buyers, to counteroffer with a number a little closer to the list price. However, if a seller is offended by a buyer or isn’t taking the buyer seriously, there’s not much you, or the real estate agent, can do.”

The expertise your agent brings to this part of the process will help you stay competitive and find a price that’s fair to you and the seller.

4. Trust Your Agent’s Expertise Throughout Negotiations

During the ‘unicorn’ years of housing, some buyers skipped home inspections or didn’t ask for concessions from the seller in order to submit the winning bid on a home. An article from Bankrate explains this isn’t happening as often today, and that’s good news:

“While the market has largely calmed down since then, sellers are still very much in the driver’s seat in this era of scarce housing inventory. It’s not as common for buyers to waive inspections anymore, but it does still happen. . . . It’s in the buyer’s best interest to have a home inspected . . . Inspections alert you to existing or potential problems with the home, giving you not just an early heads up but also a useful negotiating tactic.”

Fortunately, today’s market is different, and you may have more negotiating power than before. When putting together an offer, your trusted real estate advisor will help you think through what levers to pull and which ones you may not want to compromise on.

Bottom Line

When you buy a home this summer, let’s connect so you have an expert on your side who can help you make your best offer.

Two Questions To Ask Yourself If You’re Considering Buying a Home In Phoenix, AZ

Two Questions To Ask Yourself if You’re Considering Buying a Home In Phoenix, AZ

 

If you’re thinking of buying a home, chances are you’re paying attention to just about everything you hear about the housing market. And you’re getting your information from a variety of channels: the news, social media, your real estate agent, conversations with friends and loved ones, overhearing someone chatting at the local supermarket, the list goes on and on. Most likely, home prices and mortgage rates are coming up a lot.

To help cut through the noise and give you the information you need most, take a look at what the data says. Here are the top two questions you need to ask yourself about home prices and mortgage rates as you make your decision:

1. Where Do I Think Home Prices Are Heading?

One reliable place you can turn to for that information is the Home Price Expectation Survey from Pulsenomics – a survey of a national panel of over one hundred economists, real estate experts, and investment and market strategists.

According to the latest release, the experts surveyed are projecting slight depreciation this year (see the red in the graph below). But here’s the context you need most. The worst home price declines are already behind us, and prices are actually appreciating again in many markets. Not to mention, the small 0.37% depreciation HPES is showing for 2023 is far from the crash some people originally said would happen.

Now, let’s look to the future. The green in the graph below shows prices have turned a corner and are expected to appreciate in 2024 and beyond. After this year, the HPES is forecasting home price appreciation returning to more normal levels for the next several years.

So, why does this matter to you? It means your home will likely grow in value and you should gain home equity in the years ahead, but only if you buy now. If you wait, based on these forecasts, the home will only cost you more later on.

2. Where Do I Think Mortgage Rates Are Heading?

Over the past year, mortgage rates have risen in response to economic uncertainty, inflation, and more. We know based on the latest reports that inflation, while still high, has moderated from its peak. This is an encouraging sign for the market and for mortgage rates. Here’s why.

When inflation cools, mortgage rates generally fall in response. This may be why some experts are saying mortgage rates will pull back slightly over the next few quarters and settle somewhere around roughly 5.5 and 6% on average.

But, not even the experts can say with absolute certainty where mortgage rates will be next year, or even next month. That’s because there are so many factors that can impact what happens. So, to give you a lens into the various possible outcomes, here’s what you should consider:

  • If you buy now and mortgage rates don’t change: You made a good move since home prices are projected to grow with time, so at least you beat rising prices.
  • If you buy now and mortgage rates fall (as projected): You probably still made a good decision because you got the house before home prices appreciated more. And, you can always refinance your home later on if rates are lower.
  • If you buy now and mortgage rates rise: If this happens, you made a great decision because you bought before both the price of the home and the mortgage rate went up.

Bottom Line

If you’re thinking about buying a home, you need to know the facts on what’s happening with home prices and mortgage rates. While no one can say for certain where they’ll go, expert projections can give you powerful information to keep you informed. Let’s connect so you have a professional to add in an expert opinion on our local market.

Homeowners Have Incredible Equity To Leverage Right Now In Phoenix, AZ

Homeowners Have Incredible Equity To Leverage Right Now In Phoenix, Az

Even though home prices have moderated over the last year, many homeowners still have an incredible amount of equity. But what is equity? In the simplest terms, equity is the difference between the market value of your home and the amount you owe on your mortgage. The National Association of Realtors (NAR) explains how your equity grows over time:

“Housing wealth (home equity or net worth) gains are built up through price appreciation and by paying off the mortgage.”

How Your Equity Can Help You Achieve Your Goals

The equity you build up over the years can be used to your advantage when you sell your current house and buy your next home. If you no longer have the space you need, it might be time to move into a larger home. Or it’s possible you have too much space and need something smaller. No matter the situation, your equity can be a powerful tool you can use to help you make a move in today’s market. That’s because it may be some (if not all) of what you need for your down payment on your next home.

And how much equity you have may surprise you. A recent survey from Realtor.com finds many homeowners today estimate they’ve built up a significant amount of equity:

The latest data from CoreLogic helps solidify why homeowners are feeling so good about the equity they’ve likely gained over time. As Selma Hepp, Chief Economist for CoreLogic, says:

“While equity gains contracted in late 2022 due to home price declines in some regions, U.S. homeowners on average still have about $270,000 in equity, nearly $90,000 more than they had at the onset of the pandemic.”

How a Skilled Real Estate Agent Can Help

If you’re looking to leverage your equity to boost your buying power in today’s market, having a trusted agent by your side makes a difference.

A real estate professional can help you better understand the value of your home, so you’ll get a clearer picture of how much equity you likely have. As a recent article from Bankrate says:

“Hiring a skilled real estate agent can give you a realistic estimate of home prices in your area and how to price your current home. Using that figure, you can calculate how much equity you have and what your net proceeds will look like, so you can apply that money toward the down payment and closing costs of your new home.”

Having a solid understanding of your equity is key when it comes to making decisions about buying or selling your home. A skilled agent can help you navigate the often-complicated process of selling your house and ensure the transaction goes smoothly.

Bottom Line

Today, many homeowners are sitting on a substantial amount of equity, and you may be one of them. Let’s connect so we can estimate how much equity you have and plan how you can use it toward the purchase of your next home.