by Dru Bloomfield on May 6, 2009
photo credit: quinn.anya
Just in. The title of the Newsweek article is : Want to Sell Your Home, Lower Your Price
And it gives Scottsdale some press that may not be the best, but to me, it’s a sign that Scottsdale is now on its way to recovery too. Prices will need to drop quite a bit more to catch up to the rest of the Phoenix metropolitan area, but it’s good to be out of limbo.
Topping the list:
BusinessWeek.com teamed up with Trulia.com to rank the nation’s largest cities with the most discounted homes. Topping the list was affluent Scottsdale, Ariz., where 37% of listings have had at least one reduction and the average discount is 12.9% off the original asking price.
And then:
Of course, a reduced price isn’t always a bargain. The owner might not have dropped the price enough or might be lowering it because of some other reason (maybe the house is just plain ugly).
It’s worth reading the whole article. Falling prices are scary, or they are an opportunity. It just depends whether you selling, or buying. And something tells me, that buyers are going to be spending just a little bit more time figuring out where they’d like to live in Scottsdale.
by Dru Bloomfield on March 9, 2009
photo credit: Dru Bloomfield – At Home in Scottsdale
I’ve been pretty quiet on the blog-front this past month and a half. However, it’s been six weeks of massive action, and an introduction to the world of bank-owned (REO) properties, where the majority of home buying and selling appears to be occurring in the Phoenix metropolitan real estate market.
Last year, most of my business was in Scottsdale. In the past, I’ve worked in a much broader area, and this year will be similar. I currently have homes listed all over the Valley of the Sun, and about 75% of them are foreclosures, priced at $200,000 and under.
Our market has changed, and, in my opinion, Scottsdale is out of sync. Granted, it’s a unique city, land-locked, with many beautiful homes. Foreclosures are few and far between. Short sales are becoming much more common. However, as a whole, it’s not a moving market.
While home sales demand is increasing in Phoenix, Glendale, Mesa, and Goodyear, in Scottsdale it’s decreasing.
Click for full-size view of Scottsdale real estate supply demand graph
And, supply, or the number of homes on the market, is increasing.
Click for full-size view of Scottsdale real estate supply index graph
And when you look at the appreciation rates, comparing the City of Phoenix with Scottsdale, you can see that Scottsdale has experienced a much lower rate of depreciation, appearing to bottom out at about 20%. In Phoenix, the depreciation is much greater hovering at 40%.
Click chart for full-size view of Scottsdale vs. Phoenix Home Appreciation / Depreciation Rates
So, I’ve been pondering the reason that Scottsdale is experiencing a different real estate market. Do you think it’s because:
- Fewer number of foreclosures in the city, and many buyers are only looking at bank-owned properties, thinking they will get a better deal.
- Reluctance of Scottsdale home sellers to reduce home listing prices to incent on-the-fence buyers to make a buying decision.
- First time home buyers are looking to other communities where they can buy a larger and newer house for the same price.
- A trend towards smaller is better.
- Challenges in getting a jumbo loan (greater than $417K)
- General uncertainty and conservatism in spending.
I’m curious. What do you think?
by Dru Bloomfield on June 16, 2008
All home buyers seem to be asking this same question in today’s market:
What’s a good offer?
In the past, the sale price averaged 3-5% below list price, but in today’s real estate market, one would think that these numbers might have changed.
Recently, I represented a buyer, (we’ll call her Sue), where the home she was interested in was relatively new to the market, but priced well above the current comparable homes sales in the surrounding area.
Sue’s offer of approximately 10% below listing price was presented, and I was able to document for the not-to-happy seller’s agent how the buyer had determined her offer price. The seller countered with a price that was still too high for Sue, who opted to keep on looking for her home. Several weeks later, the house was still on the market, and my client asked me to present essentially the same offer. This time the seller accepted.
Curiosity piqued, I computed some statistics for a couple zip codes around Scottsdale, just to get a feel for where home sales prices were, as compared to the most recent listing price.
Sampling of Scottsdale Real Estate Sales Price as a Percentage of Listing Price for March 16 – June 15, 2008
|
City Area – Zip Code
|
# of Sales
|
High
|
Average
|
Low
|
|
South Scottsdale – 85257
|
91
|
107%
|
96%
|
77%
|
|
McCormick & Gainey Ranches – 85258
|
187
|
116%
|
94%
|
79%
|
|
DC & McDowell Mountain Ranches – 85255
|
252
|
120%
|
94%
|
71%
|
Interesting that we are hearing about all the low offers, and in reality are seeing some houses are selling for more than they are listed. What is even more telling, is that the average selling price of 4-6% less than listing price is not all that far off than the metric that we’ve been hearing for years.
So, when you find the house that you are ready to buy, do your research. Make an offer that’s realistic for the market, and for your budget. The seller’s response will tell you how close you are to crafting an agreement. And then, you can decide what your next steps are.
As always, your comments and questions are welcome.
by Dru Bloomfield on April 11, 2008
Home listing prices are increasing, decreasing, and holding steady, depending on which Scottsdale zip code you live or are looking to live in. I’ve put the following chart together (courtesy of Altos Research), so that you can see what’s been going on over the past year.
For instance, in far north Scottsdale (85262), the median list price actually started rising last last year and now exceeds what it was a year ago. On the other hand, Scottsdale 85254 (which is a Scottsdale zip code mostly located in the City of Phoenix), has seen a drop of over $75,000 in median list price. For the most part, the other zips are holding steady or seeing small decreases.
(Zip code 85266 is a new zip code that was split off from 85262 in July 2007, so the statistics are off and appear to normalize about October 2007.)
I’ve also included a zip code map of Scottsdale, so you can see where these particular zips are located.
You will also notice, that for the most part, lower home prices are in the southern part of the city and increase significantly as you move north.
I’ll be sharing more of these statistics soon, so if there’s a particular area in Scottsdale or a parameter (like how long it’s taking to sell a house) that you are interested in, just let me know and I’ll make that my next focus.
by Dru Bloomfield on April 3, 2008
Earlier this week, I picked up my For Sale sign and lock box from a sold listing. A beautiful, well-maintained McDowell Mountain Ranch home, with incredible views. I listed the home late last summer. Before the home was placed on the market, the owner hired a handyman, painters, and others to clean and repair the house, top to bottom. And, the home was in very good shape to begin with.
The home received excellent showings, reviews, and a couple low-ball offers.
And finally, a purchase contract was accepted. Negotiations were tough. Costly repairs were requested. More negotiations. Modification of financial terms. Long closing.
Emotions were high…. and low.
And yet, the house now has a new owner.
As I was leaving, I looked back over my shoulder at the house. I even stopped to take another photo. As an agent, my job is to masterfully coordinate the in’s and out’s of a real estate transaction. Explaining. Translating. Finding common middle ground. Thinking creatively. Working through the rough edges. And, listening, a lot.
And, through all the turmoil, relationships are created, built, and enhanced. And once the house sells, the need for the daily and weekly contact is no longer necessary. I couldn’t help but feel a little sad.
Probably not much different from the sellers, who are very relieved to have sold their home, but at the same time must have just a tinge of sadness, leaving a house they loved behind.
by Dru Bloomfield on March 31, 2008
I’ve been working with a young couple purchasing their first home. Like so many buyers today, they started their search on the Internet, and found me through “some social networking site, can’t remember which one”.
Bright, educated, and articulate, they know what they want in a home. Pre-approved for a loan. Lease up in two months. Ready to buy.
They found a house they liked and would serve their needs. Made an offer. Received a counter offer from the seller. Made a counter offer back. There was an $8,000 difference between buyer and seller on a home in the $300,000 price range, and the seller decided that he was done negotiating.
So, the buyers proceeded with their search and found a lovely home just around the corner, priced 20% higher, but a larger, much loved home, with significant upgrades. In a period of about 24 hours, they came to terms with the seller, on price and time frame. The seller even offered to leave the cat!
photo credit: foshie
We are still in a buyer’s market. Sellers often must make concessions. Buyers determine the value of the home, and a seller can choose to agree, or disagree. If there’s agreement, the house sells, if not, only time will tell.
