YPN 40 UNDER 40 AWARD WINNER

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Each year, the WeSERV Young Professionals Network (YPN) has the honor of announcing the top 40 Under 40 Real Estate Teams, Mega Teams, Teams, and Individuals.

These incredible REALTORS® are among the elite real estate professionals in the state. They have dedicated countless hours to bettering their business and meeting their clients' needs before and after closings. In addition to their drive and determination for real estate, these agents have a passion for serving their communities. They understand the importance of lending a helping hand to those in need and prioritize their time toward volunteerism.

WeSERV is proud to congratulate all of the 2023 Young Professionals Network 40 Under 40 Award recipients.

🚨MARKET UPDATE🚨

On March 1^st the Cromford Market Report made the bold statement that the real estate market in the Metro Phoenix area hit bottom in December saying,

“The contract ratio for all areas & types has risen above 60. This means we are officially in a hot market again. You should therefore anticipate house price rises over the coming months, no matter what you read in the media, which tends to base their reports and projections on housing data that is one to several months out of date, such as the S&P Case-Shiller® Home Price Index®. The opportunity to buy at the bottom of the correction occurred in the fourth quarter of 2022. Congratulations if you bought when everyone else was fearful. That was good market timing.”

Let’s review some of the reasons the Cromford Report may be saying we have passed the bottom of the market:

While prices in Gilbert have dropped significantly since the peak of the market in the summer of 2022, February was the first month since June where the average sales price did not fall. 

Active Listing counts have been shrinking since October and are at similar levels to the last "normal" market we had back in 2019. 

More homes in Gilbert were successfully sold in February, with the highest Listing Success Rate we've seen since June of last year. In February 75% of homes in Gilbert were successfully sold compared to just 62% in December.

List Price Per Square Foot in Gilbert has been steady so far this year and is right on par with what we saw in the beginning of last year, not less as you might expect. 

Sellers in Gilbert are now getting an average of 97.7% of asking price. This is down from 101.5% in February of 2022 but an increase over what we saw in January. 

This is just one month of data and it doesn't prove a trend or give us the ability to predict what we'll see over the next few months, but there are plenty of signs that the free fall in home prices in Gilbert may be coming to an end. 

All the space you need for your RV, boat, trailer, & other toys!

Located in a neighborhood with no HOA, this stunner offers a huge lot with an RV Garage with a workshop. The inside has been immaculately updated with a new kitchen and bathrooms, paint, flooring, and fixtures. With a new roof, exterior paint, and fresh landscaping, this home is turnkey and ready to go! 

 4 Bedrooms

 2 Bathrooms

 2,098 Sq Ft

 6-Car Garage

Mesa, AZ

Offered at $625,000

Contact me for more information or to schedule a private showing. 

Watch the video above for a full tour!

How To Deal With Higher Construction Costs

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As home values have risen, so have the cost of construction and home improvement projects. This increase in construction cost makes it important to plan for during the home buying process.

If you want a home with a pool for example, in some cases it may make more sense to buy a home that already has one installed.

My personal experience with this was a pre-pandemic quote to have a small pool installed for around $25,000. Fast forward to a year later and that same exact pool cost $45,000 to install.

Another project that significantly increased in price was replacing flooring, which also nearly doubled in price. When asking the contractors for the reason for these significant price increases, the answers varied from scarcity of supplies, labor shortages, and inflation in general.

The rise in home values coupled with the hefty increase in construction cost have made a big impact on how home buyers go about choosing their home.

Now, they must be more careful in deciding if they are willing to take on fixer-uppers or homes that just need a little TLC because that little TLC can end up having a big price tag.

Your Colleagues' Best and Worst Social Media Posts

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My most-successful social media posts are satirical or those that have an element of humor. These sorts of posts bring a bit of joy and playfulness to an otherwise saturated, boring, and somewhat copy-and-paste industry. My highest-performing social media posts are typically on TikTok or YouTube.

The least successful social media posts are always the ones where there’s a sell or an ask. I think the posts that say something to the effect of, “Everything I touch turns to sold,” “I’d love to help your family and friends; please refer me,” or “I have buyers lined up to buy your house” are ick-inducing and cause an immediate eye roll.

Imagine leaving your home and just walking a few steps before arriving in Downtown Gilbert. All the shopping, dining, entertainment, and nightlife without having to Uber there. Today’s home tour is conveniently located right inside Gilbert’s Heritage District.

🛏️ 3 Bedrooms

🛁 2.5 Bathrooms

📐 2,106 Sq Ft

🚗 2-Car Garage

🗓️ Built in 2021

📍Gilbert, AZ

Offered at $695,000

Contact me for more information or to schedule a private tour.

This home sits on a 3/4-acre irrigated lot in a community surrounded by citrus groves with no HOA.

The backyard is HUGE and has everything you need to enjoy the outdoors all year round with an updated pebble sheen diving pool, heated spa, fire pit & fireplace with built-in seating, an outdoor kitchen with custom palapa shade, and an extended covered patio. Relax in the peaceful garden that grows fruit bearing lemon, orange and grapefruit trees, roses, hibiscus, and lots of mature shade trees. 🍋🍊🌹🌺🌳

Have lots of toys? There’s plenty of room with a 4.5-car garage, slab parking for up to 10 cars, and an RV gate with a concrete pad to securely park a boat or RV.

For Buyers:

­Buyer demand has been more reactive to mortgage rates than normal, but that’s to be expected at the rate of increase we’ve seen this year. In terms of affordability in Greater Phoenix, a household making the median family income should normally be able to afford 60-75% of what’s sold. That measure for the 2nd and 3rd quarters of 2022 was only 22%. Some believe it would take years for affordability to return to a normal range unless sales prices drop dramatically, but that’s not necessarily true. As rising mortgage rates have quickly pushed affordability down, declining mortgage rates can quickly push it back up.

Affordability is determined on 3 things:  family income, 30-yr mortgage rates, and sales price. Price is not the only factor that needs to change in order to push affordability back to a normal state. For example, in order for the current median sales price of $418,000 to be considered affordable to a family making the median income of $88,800 in 2021, mortgage rates would have to drop to 3.35%. Or, the median income would have to increase to $119,000 per year. Both of those scenarios are too extreme to expect in a short amount of time. However, it’s reasonable to believe they will meet somewhere in the middle in 2023.

HUD will not release updated income measures for 2022 until May 2023*. However according to the AZ Department of Economic Opportunity, year-over-year wage income has shown a 5-8% increase each month through October. If we estimate a total 7% increase in median family income, that results in a median of $95,000 per year.  With 10% down, that puts a family’s budgeted purchase price of a home around:  $335,000 at a 6.3% rate, $368,000 at 5.3%, and $406,000 at 4.3%.

From this example, we can see that mortgage rates have a stronger chance of reversing affordability issues faster than any other factor and can mean the difference between a 20% drop in prices and a mere 3% drop. The only experts who can accurately predict the direction of sales prices are those who can accurately predict mortgage rates. However at this stage, mortgage rates are still volatile and most predictions have been flat out wrong.

If rates rise, prices will have to drop more to reach optimum affordability. If they drop, prices will not have to drop nearly as much. The best advice for buyers is to stay engaged with where rates are on a daily basis, and be fully educated on lender programs and seller incentives available so that they can be the first to act when the property and the payment is right for them.

For Sellers:

Welcome to an official Buyer Market in Greater Phoenix, albeit a weak one, for the first time since 2010. As expected, the city of Phoenix finally succumbed to a Buyer Market mid-November, thus classifying the entire market as such. (The northeast cities of Paradise Valley, Scottsdale, Fountain Hills and Cave Creek are all still either Balanced Markets or mild Seller Markets.) While market indicators were plummeting from an extreme Seller Market to Balance between March and June, the trip from Balance to a Buyer Market from July to December has been more like a gentle glide.

Price responses didn’t wait for the official calling, median sale prices began showing a decline after May and as of this date are down 12%, essentially erasing appreciation gained since November 2021 and resulting in a 1.6% negative year-over-year median change.
From here on out, expect reports of negative annual appreciation rates every month as each measure will now be compared to the first half of 2022 price measures.

Moving into 2023, even if mortgage rates stay the same, it is expected that contract activity will increase seasonally as it does every year. Rate buy-downs will remain a key factor in buyer incentives unless rates decline. However, after a long 4th quarter sellers should be able to enjoy more traffic, fewer days on market, and serious buyers in the first half of 2023.

Generally speaking, neither sellers nor buyers prefer to engage in real estate during times of uncertainty. Dramatic fluctuations in mortgage rates combined with insecurities surrounding inflation and unemployment have pressed pause on housing decisions for many sellers and buyers alike, for now. If mortgage rates drop, they’ll get off the fence.

Commentary written by Tina Tamboer, Senior Housing Analyst with The Cromford Report
©2022 Cromford Associates LLC and Tamboer Consulting LLC

Historically, the real estate market in Arizona cools down in December and heats back up January through May. This December was no different.

We are BACK TO BALANCE! In November we fell into a full-blown buyer’s market and stayed there for a few weeks. The Cromford Market Report notes the market has shown strong signs of recovery and we are now in a balanced market that is neutral to both buyers and sellers.

However, buyer demand is heating up and if this continues, the pendulum could swing back in favor of sellers during the typical Arizona selling season this spring.

December Recap

• The shift from a buyer’s market to a balanced market is noticeable with the number of price reductions in December being the lowest amount since May.

• Nearly half of all transactions in December had the seller paying a portion of the buyer’s closing cost with the median amount coming in around $9,300.

• Median sales price in Gilbert dropped slightly over November and was just about flat to December 2021.

• The rapid rise in inventory levels we saw in the summer/fall months tapered off in December falling 20% from October.

• Homes in Gilbert are taking 20% longer to sell than they did last month and a whopping 131% longer than they did last year.

• Since most leases are 6-12 months, rent prices are a lagging indicator of change in the market. We are now starting to see median rent prices decline slightly. For a 1,500 sq ft rental home, prices went from $2,010 in December 2021, up to $2,100 in August of 2022, and down to $1,965 in December 2022.

• Foreclosures could indicate a major shift in the market so we’re keeping a close eye on those. As of now, foreclosures are still well below pre-pandemic levels.

So, what does this mean for you if you are looking to buy or sell a home in the near future?

Buyers currently have very little competition. If you are planning to make a purchase in the near future, you may want to start the process before the selling season picks up at the end of January. This may give you more time to view properties, less competition when submitting an offer, and more leverage when negotiating.

If you are planning to sell your home in the near future, I would recommend getting it ready to list now and having it on market between January and March to give it time to be exposed during our biggest selling season of the year. Historically, 25% more homes sell between April and June than in the summer and winter months.  If you’re thinking about selling your home, contact me and I’m happy to discuss the process or even provide a complimentary market analysis to see what your home may be worth.