Phoenix Metro Real Estate and Community News

You’ll find the Thompson Group 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!

Feb. 12, 2024

Nine Great Reasons to Buy Real Estate in Phoenix

Phoenix Arizona Travel Scene

When considering the purchase of a home or real estate, of course we’re concerned about the financial aspects. But costs and prices aren’t the only consideration when buying a home – remember the real estate mantra: “Location, location, location!” The quality of life in a location is a big factor – and here are nine great reasons why the Phoenix area is a great location to buy:

1. More sunny days than any other state

Florida may be called “the Sunshine State” – but according to the National Weather Service, Arizona is #1 when it comes to number of sunny days!

2. No hurricanes

Not only do we have more sunshine, but no hurricane has ever hit Arizona (at least since we’ve been measuring and recording hurricanes). We count on tropical storms for some rain, but that’s about it.

3. Earthquakes?

Of course, California get their share – and they are right next door. But according to the U.S. Geological Survey, no earthquake in recorded history has caused death or injury in Arizona, and, in fact, only twelve mild tremors have been felt since Arizona became a state in 1912.

4. How ‘bout tornadoes?

We do get plenty of desert “dust devils,” but according to NOAA there have only been three fatalities due to tornadoes since record-keeping began.

5. Tons of golf courses

Well according to GolfGuideWeb.com, “Arizona is arguably the new golf capital of the United States, boasting more high-quality courses than any of the longstanding traditional golf meccas. The Phoenix-Scottsdale resort corridor alone has more than 200 courses…”  If you were to play a different course every other day of the year, you’d run out of year before you ran out of courses.

6. No snow days…

We get our share of chills and cold evenings, but there’s no shoveling snow or chipping ice off your windshields in Phoenix.

7. …yet we have snow!  

We just keep it a few hours away. Skiing, sledding, snowmobiling, and all the winter sports are available within a short drive from Phoenix. Then you can come back home and warm up in the sunshine by the pool or drive a few short hours to Rocky Point and relax on a sunny beach!

8. Beautiful clear nights for stargazers

Arizona night skies are so clear that some of the world’s foremost observatories are located here. Kitt Peak, Lowell Observatory, the US Naval Observatory – all are within a short drive from Phoenix.

9. Sports for anyone!

Phoenix has NFL, NBA, NHL, and MLB teams right here in our own backyard! Not to mention that not only is the nation’s newest, biggest and best-equipped baseball Spring Training facility right here in Phoenix but all fifteen teams in the Cactus League train right here in the Valley. It’s a sports enthusiasts’ paradise.

If you are ready to get started, contact us at MyAZHouse.com or 602-753-0177.

Posted in Buying a Home
Jan. 16, 2024

Thinking of Selling? Want to Enjoy Your Home More? It’s Time to De-clutter!

woman sorting clothes

 

You can easily blame this phenomenon on basic human nature. All of us get used to our living environment, albeit incrementally. Ever ask a teenager how they can live in the maelstrom they call a bedroom? They’ll usually say they don’t know how it got that way – then Mom or Dad will say that’s irrelevant, just clean it up. Little by little, we accumulate lots and lots of nondescript stuff. The human nature part of this equation is that we, like those teenagers, don’t even notice it while it’s happening! Here’s the rub: one day your spouse and you talk it through and decide that now is the time to make a major change for one reason or another. Perhaps a new job, different neighborhood, closer to outside interests, different schools, whatever. That’s the milestone day you call your realtor and announce your momentous decision to sell your house and feather a new home somewhere else.

If you’re fortunate enough to hire real pros like Jamie Thompson and his team, when he arrives for your listing appointment he’ll explain that his opening interview is very important for crafting his marketing plan for your home, and then will ask you for a guided tour of your estate. That, as Harvey Firestone used to say, is where the rubber meets the road. A true professional realtor will not mince words about the state of your estate. Before talking about painting walls or buying new carpeting, you’ll hear him or her say, “Time for serious decluttering.” Buyers don’t want to see someone’s personal effects all over what they are trying to visualize as their new home. They are mentally moving in and a five-month stack of Fortune Magazines is a turnoff, as are dozens of other things you could easily discard.

If you are not thinking about selling right now, just imagine how valuable a major decluttering would be to your day-to-day enjoyment of your home. It’s almost always a very dramatic change relative to the degree of clutter. Too much subconscious stimuli can hinder relaxation, which is a polite way of saying that unnecessary, even useless articles can get on your nerves without your being aware of the cause. The best think to tackle this is to survey your environment and ask yourself that difficult question, “Do I really need this? Will my life go on without it or have I been kidding myself into thinking that someday, the day that never comes, someday I’ll use it.”

If you are at Defcon One Clutter Alert, so to speak, step one is to determine a rough scope-of-work. If you find that there are just a few refuse cans of things to toss out, you’re in good shape. However, we’ve had clients where the quantity is pretty hefty, and this is where a personal dumpster can make your house-prep not just easier, but actually quite enjoyable. After pitching the first few boxes of things, you’ll begin to experience the liberation from larger items like that chair with ripped upholstery or an ottoman with cracked leather. Imagine having a clean, functional waste receptacle in your driveway that will devour virtually all you can put in. It is a far more economical and efficient way of staging your decluttering project than loading up your SUV and driving to the community landfill.

At the end of this process you’ll be terrifically satisfied with how your home now shows, in addition to making your realtor happy! Buyers walking through are seeing the architecture and usable volume of space for their own furnishings and future purchases. The world-famous architect I.M. Pei once defined architecture as the search for light. Buyers want to see the light in your home, the space within which they are warm and comfortable!

Finally, after you’ve taken your declutter medicine –it’s time for your reward, your consolation: Another very practical and useful phenomenon is the realization that after you rid yourself of things you never use (but somehow thought for years they merited storage space), you don’t miss them or even think about them. They are just things, most of which you regret buying or keeping because they seem to have value. Just say, “Adios, my useless shackles!” and call me for any service you need to get things in tip-top shape. My team and I have a long list of contractors from painters to landscapers to carpenters.

Posted in Home Selling
Jan. 16, 2024

Winter Can be a Stressful Time of the Year – Here are Some Local Resources for Assistance

blue mug with sad face and wrapped with a knitted scarf

 

The famed McLean Hospital of Massachusetts General cites several important points that indicate feelings of stress and anxiety this time of year are very real and, sadly, widespread. They state that according to the American Psychological Association, 38% of people surveyed said their stress increased during the depths of the winter season, which can lead to physical illness, depression, anxiety, and substance misuse. The reasons given include lack of time, financial pressure, gift-giving, and family gatherings. To make matters worse, the National Alliance on Mental Illness noted that 64% of individuals living with a mental illness felt that their conditions worsened around the holidays.

There are ways in which we can prepare ourselves and hopefully deflect some of the increased stress that often occurs in the winter season. It’s important to realize that we do have more control than we think we do. It’s equally important to realize that even if we put these ideas into practice and continue to feel overwhelmed or depressed, professional help is available. The following are many of those local resources staffed with highly qualified professional caregivers.

Chandler Mental Health Resources - The Chandler Police Department has many resources for your use below. If you or someone you know is having a Mental Health Crisis call 911. If you need a Crisis Intervention Team (CIT) trained officer to respond to your business or residence, and it is not an emergency contact our non-emergency dispatch/communications center at (480) 782-4130 and ask for a CIT trained officer to respond.

NAMI, the National Alliance on Mental Illness, is the nation’s largest grassroots mental health organization dedicated to building better lives for the millions of Americans affected by mental illness. Visit NAMI.org.

The Substance Abuse and Mental Health Services Administration, SAMHSA.org, is the agency within the U.S. Department of Health and Human Services that leads public health efforts to advance the behavioral health of the nation. SAMHSA’s mission is to reduce the impact of substance abuse and mental illness on America’s communities.

MentalHealth.gov provides one-stop access to U.S. government mental health and mental health problems information. MentalHealth.gov aims to educate and guide the following groups: The general public; Health and emergency preparedness professionals; Policy makers; Government and business leaders; School systems; Local communities.

U.S. Veterans Mental Health Resources - The U.S. Department of Veteran Affairs has significantly added more resources that you will find on their website now to address those in need including family members and even friends. Visit MentalHealth.VA.gov.

Oasis Behavioral Health: Oasis Behavioral Health Hospital helps individuals struggling with mental health disorders & drug addiction build a strong foundation for long-term recovery. Serving the Chandler community, Oasis is the premier provider of specialized behavioral treatment programs for adolescents and adults.

Among the conditions they treat are ADHD, Aggression, Anxiety, Bipolar Disorder, Borderline Personality Disorder, Conduct Disorder, Depression, Intermittent Explosive Disorder, Mental, Health Disorders,  Oppositional Defiant Disorder, Psychosis, PTSD, Schizophrenia, Self-Harm, Suicidal Ideation. Visit Obhhospital.com.

Mental Health Facilities in Chandler (Mentalhealthcenters.net/clinics/arizona/chandler) - This website has a full listing of mental health facilities in Chandler. Many of the treatment centers also provide co-occurring mental health and addiction treatment for dual diagnosis disorders for those who struggle with alcohol abuse or drug addiction. Mental health centers in Chandler, Arizona provide residential and outpatient treatment for various mental health issues including eating disorders such as bulimia and anorexia, panic disorders, schizophrenia, ADHD, PTSD, mood disorders, depression, personality disorders, phobias and other mental illness.

Information is quoted from the source’s websites, please check for updates.

Posted in Community News
Dec. 15, 2023

Signs My Home is Overpriced

high priced home

This year saw prices rise to unseen levels, but the hyper-seller’s market is slowing down and some sellers are even doing the unthinkable!  PRICE-REDUCTIONS!  As the real estate market normalizes to a more traditional market, here are a few tips to consider to be sure your home is not overpriced:

  • Comparable Sales for last 90 Days – Is your home priced right according to comparable properties? Comparable homes that have sold recently can give you a great idea of how well your home may appraise and what buyers in your area are willing to pay for a similar property.  However, these sales may not give a good idea of what the market is doing now and may not indicate a price reduction is needed 
  • Active and Pending Listings – Active listings give you a great idea of other inventory you are competing with to get your home sold, but Active listings are all UNSOLD properties.  If you are looking for successful sellers, check out Pending Listings as these are all sellers that are 2-4 weeks away from being Sold!
  • Showings – How many showings are you getting each week? If you are getting a lot of showings and an offer a week, then you are close to selling!  Or, has it been a few weeks since you last saw a buyer’s agent in your home? If so, you are probably overpriced and need to discuss a price change.  
  • Market Changes and Activity – What is the market doing? Are Employers hiring or laying off workers.  Are interest rates higher or lower? What’s new on the local MLS?  Is there a lot of inventory in the area from builders or bank owned properties?  Does your area attract lots of first-time buyers or move-up buyers? All great questions to ask when deciding on how high or low to price your home.
  • Do you really want the truth?  Being honest about the situation may be painful for sellers and real estate agents.  However, getting the pain out of the way, allows for a realistic discussion about what is necessary to get your home sold.  Also, the discussion allows for ways to bring in more buyers, reduce costs, and take advantage of the market. 

Do you need to get you home sold? Contact us at www.MyAZHouse.com or 602-753-0177.

Posted in Home Selling
Nov. 15, 2023

Homes Selling Faster, Prices Remain High - Chandler Housing Market Update

sketched images depicting real estate market trends

Despite what some may think, the Chandler housing market is very strong right now. Activity is still sluggish, but inventory is tight, home prices are up, and homes are selling faster than they were this time last year. Buyers are currently facing stiff competition for in-demand properties, and about a third of listings are selling for more than the asking price (a 15% increase over last year).

That said, interest rates continue to take a toll on buyers’ budgets, and demand is still down year-over-year. But there are fewer sellers in the market too, which means fewer listings for buyers to choose from. So even with less demand and higher interest rates, the supply-demand balance remains tight, keeping prices high and sellers in control. Let’s break it down!

A slow winter and steady rebound

When interest rates first went up, demand across the US slowed, and the constant upward pressure on prices finally eased. Initially, from August to November of last year, prices didn’t go down, but they stopped posting wild gains. In Chandler, each month our median price was rising 3 to 12% year-over-year instead of 20 to 37% during the surge.

Over the winter, we experienced our first price correction, and this continued until early spring. Our median bottomed out at $475,000 in March, a 12% decrease from March 2022. But prices steadily rebounded, and by August the median hit $505,000, a 1% year-over-year increase and a 6% bump from March.

Home prices are high

Despite fewer homes being sold in September compared to August, prices in September were stronger. The median sale price was $514,000, representing a 3% downtick from September 2022 but an 8% increase from earlier in the year.

For perspective, prior to the pandemic Chandler’s median home price ranged from under $300,000 on a low month to $350,000 on a great month. At the time, those prices were “historically high.” Then prices skyrocketed, pushing us into the half-million-dollar club almost overnight. Although our current median is down 3% from last year, it’s still remarkably high and up a full 60% from September 2019.

Activity is down

We typically see market activity peter out in the fall, and then pick back up the following spring. This year has been no exception; in fact, the decline has been steeper than a seasonal adjustment.

In September, 176 homes were sold in Chandler, compared to 299 in September of last year. The represents about a 40% year-over-year dip in transaction volume. This comes on the heels of a relatively strong summer turnout; 742 homes were sold from June to July, compared to 856 the previous summer (a 15% decline, which was milder than September’s).

As we’ve seen, activity levels alone don’t drive prices. The balance of supply and demand does. If more sellers begin listing in the months ahead, prices will soften unless demand picks up to match supply. However, with winter on the horizon I expect the market to remain tight, and for prices to hold strong (or adjust slightly with the season).

Homes are selling fast

One of the best indicators of market competitiveness is selling speed. In September, homes took 34 days to enter contract after being listed, which is 13 days faster than last September. Earlier in the year, the average home in Chandler took 50-70 days to sell, depending on the month.

When demand was surging in 2021 and early 2022, homes were selling in as little as 20 days some months. We’re not back to that pace (and we shouldn’t expect to be for a while), but homes are selling much faster than they were when interest rates first spiked, and also faster than before the pandemic.

Summer buyers have more urgency than fall buyers, so I expect selling speeds to slow a bit as fall and winter progress. But even though there will be fewer buyers and they will be under less pressure timing-wise, they will be competing for far fewer listings. For this reason, prices should stay high and sellers should remain in the driver’s seat.

Bottom line

Real estate isn’t “booming” anymore, but Chandler is still a very hot market and sellers are still calling the shots. Higher interest rates continue to constrain demand across the country, but here locally prices are still high and homes are selling faster than they were last year. On average, listings are selling for nearly the full asking price, and well-positioned listings are selling even higher. This winter will be particularly opportune for sellers in Chandler, with prices up, inventory down, and buyers eager to secure a home.

If you have questions about the market or are considering a move, give me a call today at (602) 753-0177. I’ll provide a complimentary, in-depth review of your home and walk you through the right strategies for selling in today’s market.

Posted in Home Selling
Oct. 19, 2023

Selling for Top Dollar – Getting Tons of Exposure

Real Estate Exposure Concept

The day is here! You need to sell your home. The next steps are to find a real estate agent familiar with the Phoenix MLS, put your home on the market and negotiate a contract. The number 1 rule in selling your home is to get you home tons of exposure. The more exposure you get for your home, the more potential buyers and the faster the sale and a higher sales price for your home. Seems simple, right? Here are a few things to consider when going to market.

Focus Local and Worldwide. Recently, our team got a call from another state about one of our listings. The buyer who happened to have cash for a purchase found one of our listings on the internet. Unable to find a local Phoenix Real Estate agent, the buyer called us directly to purchase the home. The buyer said, “Your home is beautiful.”  While our seller took credit for the beautiful home, we took great pride in showcasing the home with our elite marketing plan.

Focus on the Internet. The internet has huge potential to market our listings, but also is very risky. While allowing agents to showcase a home’s best features, the internet can also make a home look very bad. Dark pictures, pictures of small rooms, pictures of the commode, and even the lack of any pictures will dissuade buyers to not look at your home. The presentation of a home over the internet should entice a buyer’s interest to see more of the home by scheduling a showing.

Focus on the Phoenix MLS. The Phoenix MLS allows home owners and agents to add lots and lots of features.  Important upgrades like granite counters, RV gates, energy efficient upgrades, cul-de-sac lots, vaulted ceilings, etc are very important to buyers. Many buyers and buyer’s agents will search for these important upgrades on the internet and the MLS database. Every time a buyer searches for features, and finds your home, the buyer is likely to want to see inside your home.

Don’t Forget Traditional Advertising. With I-phones, tablets, and many other tech devices, it may be easy to forget the traditional advertising. However, traditional advertising is still very successful for attracting buyers.  Newsletters, Just Listed Notices, and Color Flyers are still huge for getting the attention of buyers. While younger buyers under the age of 30 will start their search for a home on the internet, many older buyers will start their search with the newspaper or from items received in the mail. On a daily basis, many Phoenix Homes for Sale can be found in the local paper.

A great marketing plan includes aspects of all these items and any other ways of getting buyers to see your home. Remember, the name of the game is exposure, exposure, exposure. Do you have more questions? Do you want to learn more about this or other ways to get the most money from the sale of your Phoenix Arizona Homes?

We can help!  Contact us at (602) 753-0177 or MyAZHouse.com   

Posted in Home Selling
Sept. 14, 2023

School’s in Session! Safety Tips for Chandler Parents

By Jamie Thompson

elementary school children with words Back To School

As parents, we want to do everything possible to keep our children safe. This is especially true when it comes to school, where they spend a significant amount of time each day. There are a number of things you can do to help protect your kids at school, both physically and emotionally.

Walking to School or the Bus Stop

If your child lives close enough to school or the bus stop, consider letting them walk! It will improve their mood and performance at school, and they’ll form great memories and friendships along the way. However, it’s important to make sure they can do so safely. 

  • Map out a safe route. Walk or bike the route with your child a few times before they start going on their own. This will help you identify any potential hazards along the way, such as busy streets, construction, or secluded areas. 
  • Teach your child to be aware of their surroundings. They should put their phone away and never walk or bike wearing headphones, so they can be aware of what’s going on around them. Remind them that it’s safest to be where lots of people can see them, and explain why they should never take shortcuts.
  • Create and practice an emergency plan. Create an age-appropriate plan for what to do in an emergency. You don’t want to scare your kid, but it may be helpful to role play a few scenarios on one of your walks together. 
  • Arrange a walking crew. Find out who else in your neighborhood walks to school or the bus stop, or if there’s already a group your child can meet up with. Younger children should never walk alone; if a buddy can’t be arranged, consider walking with them yourself.
  • Make sure they know key contact info. They should know their address and both parents’ phone numbers. This is important even if they have a phone, because phones can run out of battery or get misplaced.

Bullies and Social Media

We can’t completely shield our kids from the dangers of bullies and social media, but there’s a lot we can do. 

  • Know your kid’s crowd. This is the number one thing you can do to get ahead of the inevitable conflicts your child will encounter at school. Get to know their friends and friends’ parents, and always know where they’re going and who they’re with – this is important at every age. 
  • Make your home the place to be. This is an especially great tip for parents of teens. Create a “chill pad” in the basement or den; set up board games, a minifridge, snacks, and a gaming system. Keep in mind that teens desperately want independence, and won’t have their friends over if you hover. 
  • Talk to your child about bullying. Make sure they know what bullying is, and that they should tell you if they are being bullied. Empower your child to assert themselves when it’s physically safe to do so, and to get help if they ever feel threatened. Teach your younger kids the difference between bullying and lesser offences like teasing, and strategies for dealing with both. 
  • Set social media boundaries. Remind your child that people only put their best moments online, which can make us feel “less than.” Social media can also make us feel excluded, because every little get-together gets posted online these days. Give your child a realistic perspective about social media, and set boundaries for its use. This could include things like turning in phones after dinner, not friending strangers, and installing a parental monitoring app.

Safety Gear 

These days there are plenty of safety gear options for children and teens. Here are a few I’d recommend:

  • GPS tracking devices. These devices are small and affordable, and can help you track your child's location in an emergency. Be sure to put it in or on something that is likely to stay with your child, such as a shoe sole or interior pocket, or consider purchasing a wrist model.
  • Personal alarms. Personal alarms are like pepper sprays for kids; they’re safe, but great at scaring away a bully or attacker. Get one with a keyring that can be attached to backpacks.
  • Bulletproof backpack or insert. Tragically, this is now a product worth considering. There are many options available in various price ranges, including inserts for any regular backpack. Teach your child how to use it, but explain that it’s like fire insurance; we buy it even though the odds of needing it are very low.

By following these tips, you can help keep your kids safe at school. Above all, keep communication open and model safe behavior. By working together, you can help create a safe and positive school year for your child!

 

Posted in Community News
Aug. 22, 2023

Signs My Home Will Close On Time

hand with a model house and hand with house keys

A seller put his Phoenix Arizona home on the market to move out of state. A buyer viewed the home and found it to be perfect for their growing family. The buyer and seller negotiated a contract to sell the home. The buyer completed inspections and found a few repairs. The seller boxed up a lifetime of memories and loaded the moving truck! The home selling process appears to be going very smoothly… But wait! Will this home close on time, or are there problems ahead? Here are a few indicators to look for: 

  • Buyer Qualifications Reviewed – When a buyer writes a contract to purchase a home, the buyer should present a list of pre-qualifications with the contract. In Arizona, there is a standard Pre-Qualification form that should be completed by the buyer’s lender. This form is loaded with information about the perspective buyer. Important are items that the lender requires from the buyer in order to start and complete the loan. Completing these items sooner will allow for a quicker close – overlooking them will certainly slow the process. How these items are managed is a clear indication of whether the home will close on time or not.
  • Appraisal Complete – The appraisal should be ordered within the first few days of an accepted contract. While there is no hard and fast rule for completion of the appraisal, all parties agree that sooner is better than later. The appraisal should be good news, but there could be bad news lurking. Certainly, when the buyer's financing depends upon completion of the appraisal, a good sign that the closing of the home will occur is completing this important step.
  • Loan Package Submitted to Underwriter – Another big step for every home purchase is submitting the loan package to the underwriter. Included in the loan package is the title report, the completed appraisal, terms of the loan, the buyer’s application, and a bunch of documentation that none of us think about on a regular basis. The underwriter reviews the loan package for a few days and generally will give loan approval with prior to document (PTD) conditions. If this step is completed early enough in the escrow process, clearing the PTD conditions should not hold up the closing day. However, at times, the PTD conditions may require documentation not readily available, thereby delaying the closing date.
  • Don’t Forget About the Home Owner Association (HOA) Disclosures! –While the Arizona contract calls for delivery of all HOA information to the buyer, state law allows HOAs 14 calendar days from the time of the request to delivery to provide all necessary information. Normally, the title agency involved will make the request for HOA documents early, after contract acceptance. However, delivery of these documents to the buyer may not happen for some time and the buyer receives 5 days to review the HOA documents. While review of HOA documents should not hold up a typical 30 day COE, it may delay shorter escrows.  
  • Buyer Loan Docs to Title – A great sign! No matter how choppy the last few weeks may have been, delivery of buyer loan docs to title is a sign that the closing will occur in 3 days. All parties will be in a hurry to complete the last tasks of the transaction and there may be some extra drama and stress. However, be assured that closing of the home generally happens for most Phoenix Real Estate transactions.
  • Short Sale Exception – If you are purchasing a short sale transaction, the seller’s bank may delay the closing date for 1-3 business days in order to approve the final settlement statement. While very annoying to all parties, this is a necessary extra step for most short sales. Some listing agents and title companies are proactive here and initiate the bank approval early. If so, then you have a sign that closing will happen on time!

Do you want to learn more about how to make your home buying or selling process go smoothly? Want to know more about Phoenix homes for sale? Our knowledgeable Phoenix AZ Realtors can help find the gems in the Phoenix MLS as well as make sure that your sale goes as smoothly as it can. 

Contact us at www.MyAZHouse.com or (602) 753-0177

Posted in Home Selling
July 26, 2023

Experience Matters – Questions to Ask Before Selling

 

house-shaped icon with a question mark insideOur clients have presented us with many unique situations when selling their Arizona Homes. Whether moving out-of-state to take a new job, hoping to buy a bigger home with a pool, needing to be in a new school district, or looking to downsize to a home that is more manageable, our clients all had something very important in common. Each had future plans – plans that depended heavily on how the logistics of the sale were handled and the financial results of the sale.

Marketing and Selling Homes is Serious Business.

A well planned and executed sale of a home allows the homeowner to move forward with their next phase of life. However, mistakes may cost thousands of dollars and hours of stress when escrows are canceled. Nothing may be more important in the transaction than the knowledge and experience of the agent giving you advice. So, here are a few good questions for you to ask your agent:

  • What do you know about the area? At times, knowledge of the area can be the key to selling a home. Buyers that are new to the area need to know information about schools, movie theaters, shopping and more. An agent who lives in the area can help buyers identify how they will enjoy the area – and many times, the home will sell quicker.
  • How do you market my home? Believe it or not, some agents think that ordering a “for sale” sign and putting your home in the multiple listing service (MLS) is how to sell a home. This is only the beginning! Great agents should be able to deliver to you a written marketing plan tailored for the Phoenix Real Estate market along with success stories from using that plan.
  • How much are the costs of selling my home? In order to plan for the future all homeowners with Phoenix homes for sale need to know the amount of money they will have after the sale of the home. Great agents should be able to estimate the cost of real estate commissions, title fees, loan costs, repair costs, and property taxes.
  • When will the buyer’s loan be approved? Without loan approval, the sale of the home cannot close escrow. In tracking a lender's process, a great agent should know how to use the LSU (Loan Status Update) form, what “PTD” conditions are, and what is the time needed for a lender to get loan documents to title after full loan approval. Being able to track the lender's progress is essential for a seller to know whether they will close on time or not.
  • What is breach of contract and how do you handle this? In the Arizona purchase contract, the seller is unable to exit the contract while the buyer retains over five exits from the contract. However, if the buyer is in breach of contract, then the seller may exit the contract. Breach of contract occurs when the buyer takes actions that are contrary to the written contract. This is a serious situation that experienced agents should have a plan to handle.

Do you want to learn more about how to make your home-selling process go smoothly? Contact us at www.MyAZHouse.com or 602-753-0177.

Posted in Home Selling
June 16, 2023

What’s the Deal with Rates?

What you should know about mortgage costs, and how to lower yours

By Jamie Thompson

 

percent sign and toy home representing mortgage rates

Mortgage rates here in Chandler and across the country have been on the rise for a while. This has caused some potential sellers to put their plans on hold – no one likes jumping from a 3% loan to one in the 6% range.

Is that the right strategy? What’s going on with rates anyway, and are there any workarounds for buyers? I’d like to break all this down and give you my take.

Rates are up, but still historically low

As of June 13, 2023, the average 30-year fixed mortgage rate in Chandler is 6.84%, up from 5.52% a year ago. The average 15-year fixed rate is 6.09%, up from 4.67% in June 2022.

I’ve been helping people buy and sell homes for over 20 years, and have seen rates fluctuate a lot in that time. In fact, when I first got into the real estate business, 30-year mortgages were about where they are now, and the Fed was actively increasing them (this was right after the Dotcom crash and 9/11 attacks). Rates bounced around quite a bit for a while, but rarely dipped below 6%. Eventually, after the 2008 crisis, a 30-year fixed fell to an average of about 5%, and then kept on getting lower. 

In 2021, the national average 30-year fixed rate bottomed out at 2.96% – unheard of! That isn’t the norm; it’s the exception. Never in my life or career have I ever seen that, and I doubt I’ll ever see it again. 

Although rates are up, they are still relatively low compared to historic trends. The average 30-year fixed mortgage rate has been above 6% for most of the last 40 years, and only dipped below 7% twice from 1980 to 2000. In the last 20 years, rates have been the 6% range about half the time.

Inflation control

Last year, inflation hit a 40-year high, and the Federal Reserve has been trying to bring it down to its target of 2%. It’s been working; over the last twelve months, inflation has been decreasing.

The Fed raises rates in a few ways; one is by setting the Discount Rate. This is an interest rate they charge banks for loans, which causes all rates downstream to be affected. The Fed is expected to continue raising interest rates throughout 2023, bit the pace of rate hikes should slow as inflation continues to improve. 

Where rates are headed

Analysts are forecasting that mortgage rates will continue to rise in 2023. The Mortgage Bankers Association believes the national average for a 30-year fixed mortgage rate will increase by about 70 basis points (0.7%) by the end of the year.

The rise in mortgage rates is expected to continue constraining both supply and demand in the housing market, but home prices should remain strong in 2023. Even though demand for housing is lower today, it still outweighs the number of homes for sale.

Ways to Reduce Mortgage Costs

There are a number of ways to reduce your mortgage costs while interest rates are higher. Here are the best ones:

  • Infuse more cash. A larger down payment will lower your loan balance and thereby your payment; along these lines, you can pay additional cash toward principal as you’re able. Although your mortgage payment is fixed, the interest portion fluctuates each month based on your balance. Paying down principal reduces this cost, which means a larger portion of each payment will further reduce your loan balance and overall cost.
  • Shorten your term. A shorter-term mortgage will result in a higher monthly payment, but the interest rate will be lower and you will pay off your loan much sooner. If you can afford a higher payment, this method will save you a lot of money on interest. 
  • Rate Buydown Credits. A rate buydown credit is a fee a borrower can pay to reduce their mortgage rate for a period of years. Sometimes, you can negotiate with the seller of your new home for a portion of this cost. Although you can buy one for the life of a loan, we’d recommend a 1- to 3-year credit for a 1 or 2 percent reduction in interest. By the time the credit expires, you may be able to refinance for a lower fixed market rate.

Bottom Line

Mortgage rates are indeed higher than they were last year. This has affected buyers’ purchasing power, and caused many people to hold off on buying and selling. Rates are still relatively low compared to historic trends, but we’ve been accustomed to even lower rates for a long time.

Although I understand why some sellers are hesitant right now, rates could very well be higher down the road. For this reason, I encourage anyone considering a move not to hesitate, and to take advantage of the cost-reduction strategies listed above.

If you’re considering selling now or in the future, give me a call today at 602.753.0177. I’m eager to get to know you and help make your next move a success! 

 

Posted in Buying a Home