Buyer Demand Still High, but Supply Running Out

Many Americans mistakenly believe that owning a home is beyond their means. Both homeowners and renters have the misconception that buyers need a down payment of at least 20 percent before they can qualify for a mortgage and purchase a home. But this is a home-buying myth, according to William E. Brown, president of the National Association of Realtors (NAR), who said, “Every month this year, roughly 60 percent of buyers who financed their purchase with a mortgage made a down payment that was 6 percent or less.” Buyers with steady jobs and reasonable debt loads can find mortgage options that suit their current level of savings.

Homes Selling Quickly

Those who qualify for a mortgage may have a difficult time finding a property to purchase, though. In July, an average property remained on the market for 30 days; this is two days longer than June’s pace but an impressive six days shorter than July 2016. Of all the homes on the market in July, 51 percent of them sold in less than one month. What’s more, for the past four months the average listing went under contract in under a month.

First-Time Buyers

The lack of supply will lead to more competition in the market this fall. This is not welcome news to first-time buyers; this group accounted for 33 percent of all housing market activity in July. This is up 1 percent from both a month ago and a year ago. For all of 2016, first-time buyers represented 35 percent of the market.

Some Gains, Some Losses

Although the demand for homes is high among first- time and veteran buyers alike, the lack of inventory is putting pressure on the sales pace. Existing-home sales increased in the South and West in July, but these gains were tempered by drops in the Northeast and Midwest. Overall, home sales fell 1.3 percent to a seasonally adjusted annual rate of 5.44 million, the lowest rate of the year to date; however, the sales pace is still 2.1 percent higher than July 2016. 
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Silver Alliance Realty is here to help you through all your real estate questions and concerns.  We make buying and selling your home SIMPLE!

Contact Silver Alliance Realty

Mary Platt

Designated Broker

(602) 618-6764

Mary@PlattTeamAZ.com

www.SilverAllianceRealtyAZ.com

www.SilverAllianceAZHomeSearch.com

Three Reasons Now Is a Great Time to List Your Home for Sale

Housing market conditions are challenging for buyers in many parts of the country; sellers, meanwhile, are finding the market favorable. Inventory levels are low and sales prices are high. In some markets, multiple offers have become prevalent. And in a blow to first-time buyers everywhere, fewer affordable homes are coming onto the market. Despite all this, existing-home sales climbed in the month of May; every region except the Midwest posted month-over-month and year-over-year sales increases.

1. Low Inventory

According to Lawrence Yun, chief economist for the National Association of Realtors (NAR), “Current demand levels indicate sales should be stronger, but it’s clear some would-be buyers are having to delay or postpone their home search because low supply is leading to worsening affordability conditions.” In May, 1.96 million existing homes were available for sale, an inventory increase of 2.1 percent from a month earlier. However, for the past 24 months, inventory has fallen year over year, and May was no exception: inventory was 8.4 percent lower than last year. At the current sales pace, the current housing stock could last only 4.2 months, down from 4.7 months a year ago.

2. Selling Quickly

Due to the inventory shortages, homes are not sitting on the market for long. In May, the time it took for a home to go from listed to sold was on average 27 days. This is the shortest time frame recorded since NAR began tracking the number of days on the market in May 2011. Of all the homes sold in May, 55 percent were on the market for less than 30 days, another all-time-high record.

3. Prices Up

With high demand and low inventory, home prices climbed to a record-breaking high. In May, the median existing-home price reached $252,800, a 5.8 percent increase from a year ago. This is the highest recorded median sales price, overtaking June 2016’s peak of $247,600. What’s more, this is the 63rd month in a row of year-over-year sales gains. According to Yun, “Home prices keep chugging along at a pace that is not sustainable in the long run.” Unless the market sees an increase in the number of listings in the affordable price range, housing affordability may be affected. 
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If you are interested in selling your home in Arizona, contact Silver Alliance Realty!

Mary Platt • Designated Broker

(602) 618-6764 • Mary@PlattTeamAZ.com

www.SilverAllianceRealtyAZ.com

www.SilverAllianceAZHomeSearch.com

Planning for Solar? Follow These Steps

Residential solar panel installations are on the rise in the United States—according to the US Department of Energy, more than one million American homes have had solar panels installed as of May 2016. However, utilizing solar energy for your home only makes financial sense if the panels can generate electricity for less than what you are paying your utility company. That means that while living in a sunny location is key, your state’s utility costs are also a factor. Before you schedule a solar installation assessment, answer these basic questions to help you determine if solar is a good fit for your home:

• Does your roof have unobstructed, clear access to sunlight for most of every day?
• Is there ample roof space or an area large enough to mount the system? 

• Is the investment worth it?
• Can you meet requirements for local permits?

Selecting the Right System

Evaluate your energy consumption patterns before selecting your solar system components, so you can choose the appropriate photovocaic (PV) system size for your home, and help reduce your overall electrical use. Begin by performing a load analysis, which should include:

• Recognizing your current consumption trends
• Examining your utility bills for the past year
• Calculating your energy consumption

A Grid-Connected or Stand-Alone System?

A grid-connected PV system uses power from your utility’s grid when it does not produce enough energy. When your system produces excess electricity, your utility provider is required to buy it. With net metering, your provider pays retail price for excess power that you send back through the grid.

Choose a stand-alone PV system if:
• You live in a remote location and it would be more cost-effective.
• You are planning to install a hybrid electric system that also uses a small wind electric system.
• You have minimal power needs.

Before purchasing a system, research city or county permit requirements. These will include an electrical permit, building permit, or both. Most PV providers will roll the permit prices into the complete system price.

For more information about solar installation in your community, contact the North American Board of Certified Energy Practitioners to locate a certified solar installation professional. 
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www.SilverAllianceRealtyAZ.com

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Mary Platt 
Designated Broker
(602) 618-6764
Mary@PlattTeamAZ.com

Why Is Location So Important in Real Estate?

Why Is LocationSo Important in Real Estate?

Location should be your first consideration when purchasing a new home. And your second. And your third. The reasoning behind this advice is simple: In some locations, homes are desir- able. In other areas, they are not. Desirable homes receive a higher demand from potential home buyers, which means you should be able to sell your property quickly. And since high demand pushes up prices, you should also be able to sell it at a good price.

Why Choose the Best Location over the Biggest House?

What is it about location that makes it so vital to your real estate selection? Put simply: it’s the one variable that is out of your control. The layout, condition, and amenities of any home can be changed with a little money and imagination. You can even change the size of your house with the right permissions. The one thing you can’t change? The property’s location. This is why real estate agents advise their clients to buy the worst house on the best street̶you can always add value later by fixing up the property. In the meantime, you get all the community and resale benefits of a premium location.

Location Affects Quality of Life

Location is important because “home” is more than just the physical structure where you eat and sleep. The neighborhood and surrounding community have a big impact on your quality of life. For example, most people have to work, but if there are no major employers in the area, or if the public transportation is lacking, getting to work will be unnecessarily hard. You might find bargains in these areas, but the trade-off is time spent on your daily commute. For most people, time is a priceless commodity for which they are willing to pay, so a more expensive property closer to work is preferable.

Access to Jobs, Schools, and Entertainment

Well-located properties typically have good transportation infra- structure and are located near a concentration of jobs. Other sought-after attributes include a top-rated school district, low crime, and access to shops, restaurants, and entertainment. When you buy a home in a location with these features, it’s usually a solid long- term investment. A premium location is always more expensive, so for tight budgets some form of compromise is inevitable. The advice remains the same, though: always buy in the best location you can afford.

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5 Smart Upgrades for the Most-used Rooms in your Home

Courtesy of Brandpoint

Kitchens, bathrooms and bedrooms are typically the rooms in any home that get the most use, which could also be why homeowners, when surveyed, consistently cite those rooms as the ones they most want to renovate. It makes perfect sense to upgrade the rooms where you spend the most time, but in high-traffic areas, you can't afford to make changes just for the sake of cosmetics. You want improvements that can enhance your enjoyment of a room and its functionality.

Here are five smart improvement ideas from Velux America:

1. Add organization/storage
Clutter and chaos not only make a room function less efficiently, it can impact your mood as well. Adding organization and storage to rooms where clutter typically collects - such as bedrooms, living rooms and game rooms - is an easy, cost-effective way to improve the function of the room and how you feel about spending time in it.

In bedrooms, maximize closet space by installing organization units. A variety of manufacturers offer ready-made units you can install yourself. Or, for a bit more investment, you can have a professional closet organizer custom-make a unit to fit your space and needs. In living rooms and game rooms, built-in shelving and cabinetry is a functional and beautiful way to improve organization.

2. Improve ventilation
Air flow is critical to the health of your home and everyone who lives in it. Ventilation in kitchens and bathrooms carries away excess moisture that can cause mold and mildew, and creates a fresher, more healthful environment by exhausting stale indoor air.

Bathrooms should be equipped with exhaust fans, and kitchen hoods should vent to the exterior of your home whenever possible.

3. Replace older, inefficient fixtures and appliances
Fixtures and appliances are key elements of kitchens and bathrooms. Older ones not only look dated and shabby, they can cost you money because they use more electricity and water than newer, more efficient models.

Replacing old faucets, shower heads, dishwashers and washing machines with newer models that use less water can reduce your water bill and give kitchens and bathrooms a whole new look. Energy Star-qualified appliances such as stoves, clothes dryers, refrigerators and washers also use less electricity than older appliances, so you can also lower your energy bills.

4. Freshen the foundations
Every room benefits from a good foundation, and that doesn't just mean sturdy flooring. Wall color, flooring materials and trim are fundamental elements in any room. Simply repainting walls and woodwork can completely change the way any room looks. Or, if you like the colors you have, a fresh coat in the same color will make the room look brighter and newer. Replacing worn carpeting or dated tiles, or refinishing a hardwood floor are also great ways to improve the foundations of any room.

5. Add natural light
Most rooms in the home look better and are more functional in natural light, and more daylight can help reduce the need for artificial light. What's more, there's no arguing the positive mental and physical health effects of natural light. Daylight stimulates the body to produce Vitamin D and boosts brain levels of serotonin, which is thought to be associated with positive moods.

Adding skylights is a practical, cost-effective and attractive way to bring more natural light into virtually any room. Remote-controlled, solar-powered fresh-air skylights from Velux America provide not just natural light, but passive ventilation, a real plus in kitchens and baths.

In kitchens, Energy Star-qualified fresh air skylights increase natural light and ventilation without requiring any loss of wall space you could better use for cabinetry. In bathrooms, they provide the perfect combination of privacy and healthful natural light and ventilation.

Visit www.whyskylights.com to learn more.

5 Forces Changing the Real Estate Industry

The global service economy is currently being transformed by five powerful forces. These forces include government policies, social changes, business trends, advances in information technology, and globalisation (Wirtz et al., 2012). Being aware of these and how they effect the real estate industry will help realtors strategically plan for the future.

Government Policies

Whether organisations like it or not, government institutions do have a hand in effecting the service economy. By implementing regulations and policies, governments can change the way an industry is run. For example, government policies effected the real estate industry in the United State by enforcing a new lending law, TRID, in October of 2015. Before TRID real estate transactions were able to close quickly, even with changes to buyer’s closing costs. After the law was implemented, transactions take three to five business days longer if any minimal changes were made to closing costs (Winzelberg, 2015).

Social Changes

As society changes the service industry follows. Social changes can include consumer expectations and lifestyles (Wirtz et al., 2012). In the real estate industry, social changes can clearly be seen between generations. As the world’s baby boomer generation ages, more people are likely to purchase homes in retirement communities or sell their current homes in order to afford assisted living. Additionally, Generation Y’s are not purchasing homes as a result of school debt and an increased desire to purchase experiences and travel internationally.

Business Trends

The third force that is transforming the service landscape are business trends. Considering a major business trend is moving toward self service technologies, it is extremely crucial for realtors to showcase why being represented by a real person is worth the extra money. Another business trend that is growing is the importance of networking and building business allies (Wirtz et al., 2012). Many real estate brokerages have strategic partnerships with home warranty companies, title agencies, lenders, handymen, and electricians.

Advances in Information Technology

Arguably the strongest force that is effecting the service economy is the rapid advancement in information technology. The internet and mobile devices make it possible for consumers to have endless knowledge at their fingertips. Realtors are adapting to this force by offering free home searches on their websites. Consumers are enjoying the power of being informed and have come to expect it. Continuously, offering extended services that are embedded in technology is a great way to build relationships with your consumer.

Globalisation

In today’s economy, it is normal and quite easy for a customer or businesses to look outside of their own country in order to satisfy a specific consumer need. This factor is the reason why globalisation is the final force shaping the service economy. Never before has global travel or the transfer of information across continents been so convenient. The real estate industry needs to be prepared to interact with foreign clients on a more frequent basis. Global citizens expect real estate professionals to be able to work with international banks and entities. 

Always be up to date with where your real estate market stands by visiting www.SilverAllianceRealtyAZ.com. If you are looking to rent or purchase a home in Arizona Search Arizona Homes For Sale here.

Follow us on Facebook at www.Facebook.com/Platt.Team.AZ

References

Winzelberg, D. (2015, October 26). The Impact of TRID. Retrieved July 23, 2016.

Wirtz, J., Chew, P., & Lovelock, C. H. (2012). Essentials of Services Marketing (2nd ed.). Pearson.

Update From Your Broker

Update From Your Broker

Hello to Everyone,

Hope everyone has enjoyed this beautiful spring here in the Valley.  Let’s hope our summer weather is as nice as our spring has been!

Home sales remained seasonally brisk in the first four months of 2016. There were 27,915 total homes sold.   Last year at this same time in 2015, there were a total of 26,769 homes sold.  We are projecting steady housing demand as we move towards the annual peak sales months of June and July.

We currently have about 27,000 active listings. Our 2016 average sales prices for the Valley are slightly up 2.3% from 2015. Average days to sell a home are 78 days.  Of course, these numbers vary from city to city and even within neighborhoods.  

Please call Tom or me with any questions you may have. 

Best wishes for a wonderful summer,

Mary

www.SilverAllianceAZHomeSearch.com
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